Muara Laboh geothermal power expansion secures USD 92M loan from ADB - ThinkGeoEnergy
Published April 03, 2026
Muara Laboh Geothermal Power Expansion Secures USD 92 Million Loan from ADB
The Muara Laboh geothermal power project in Indonesia has successfully secured a loan of USD 92 million from the Asian Development Bank (ADB) to support its expansion efforts. This financing is aimed at enhancing the capacity of the existing power plant and contributing to the country’s renewable energy goals.
The Muara Laboh project, located in West Sumatra, is a significant part of Indonesia's strategy to increase its renewable energy generation. The project is developed by PT Supreme Energy Muara Laboh, which is a subsidiary of the Supreme Energy Group. The expansion will increase the geothermal power plant's capacity from 220 MW to 330 MW, thereby providing a substantial boost to the local grid and supporting the national energy mix.
ADB’s financing will help facilitate the construction of additional production wells and the installation of a new steam turbine generator. The project is expected to play a crucial role in reducing greenhouse gas emissions by displacing fossil fuel-based power generation in the region.
Geothermal energy is considered a key resource for Indonesia, which has one of the largest geothermal reserves in the world. The country is aiming to utilize its geothermal potential to meet the growing energy demands while also addressing environmental concerns. The Muara Laboh project is part of a broader initiative to increase renewable energy contributions to Indonesia's energy portfolio, which aims for 23% of the total energy mix to come from renewable sources by 2025.
The ADB has been actively involved in financing renewable energy projects across Asia, recognizing the importance of sustainable energy solutions in combating climate change. The bank's support for the Muara Laboh geothermal project aligns with its commitment to promoting clean energy and sustainable development in the region.
In addition to the environmental benefits, the expansion of the Muara Laboh geothermal power plant is also expected to create jobs and stimulate local economic growth. The project will provide employment opportunities during the construction phase and in the ongoing operation of the facility once it is completed.
As part of its financing agreement, ADB will also provide technical assistance to ensure that the project adheres to international best practices in environmental and social safeguards. This includes measures to minimize the impact on local communities and ecosystems, ensuring that the project contributes positively to the surrounding area.
The Muara Laboh geothermal project exemplifies the potential of geothermal energy in Indonesia. With the right investments and support, the country can significantly enhance its renewable energy generation capacity, reduce its reliance on fossil fuels, and move towards a more sustainable energy future.
As the world increasingly turns to renewable energy sources, projects like Muara Laboh represent a critical step forward in achieving energy security and sustainability. The successful financing from ADB underscores the growing recognition of geothermal energy as a viable and essential component of the global energy transition.
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