Generation Expansion Planning in Indonesia: A Comparative Study of Interconnection vs. Local Renewable Integration in Baubau-Raha System Considering Uncertainties

This study examines the strategic generation expansion planning for the Baubau-Raha electrical system in Southeast Sulawesi, Indonesia, to address sustainability and energy security goals, given the insufficiency of current fossil fuel-based generation to meet increasing demand and renewable energy (RE) mix targets. Five scenarios were analyzed: the National Plan for Electricity Supply (RUPTL) Compliance Scenario (RUC), Time-Shifted RUPTL Scenario (TSRU), Local Renewable Energy Scenario (LRE), Local Renewable Energy - Storage Scenario (LRES), and Local Renewable Energy - Storage with Interconnection Scenario (LRESI). The study employs linear programming optimization to assess the economic and operational impacts of each scenario. The RUC and TSRU scenarios follow existing plans; however, TSRU offers cost savings due to its adjusted schedule. The LRE scenario reduces dependence on imported fuels but results in a higher Levelized Cost of Energy (LCOE) due to the need for more RE investments. The LRES scenario involves high initial costs due to BESS. However, it improves system reliability by stabilizing RE variability and reducing fossil fuel use, leading to a lower LCOE than LRE. The LRESI scenario combines local renewable integration and grid interconnections. While its LCOE is similar to RUC and higher than TSRU, it offers the highest system resilience and is more cost-effective in the long run compared to LRES and LRE.