Indonesia is planning a new feed-in tariff (FiT) as high as US$0.25 per kilowatt hour applicable for 20 years, the country's Finance Minister Agus Martowardojo has announced.

The government said the FiT was intended to promote the construction of new solar facilities in remote areas of Indonesia, such as on Flores Island in East Nusa Tenggara and few regions in Papua, reports the Jakarta Globe.

The government will retain its competitive bidding process for new solar power facilities, so the higher FiT rate may not be applicable to bid winners.

But Martowardojo said: “Should the investors decide to use more locally made components, then the price would be higher.”

State owned energy regulator PLN will purchase the electricity generated from facilities receiving the FiT.