The Ministry of PUPR Offers Investment with PPP Scheme in the Karian-Serpong Regional SPAM for Clean Water Supply in Jakarta and Tangerang
Source: Ministry of Public Works and Public Housing
Date: 18 April 2020
Jakarta - The Ministry of Public Works and Public Housing (PUPR) is conducting a market sounding with the Public-Private Partnership (PPP) scheme for the Karian-Serpong Regional SPAM project worth Rp 2.21 trillion. Market sounding activities carried out by the Directorate General of Infrastructure Financing via video conference on Friday (4/17/2020) according to the COVID-19 protocol and attended by 150 participants from 71 institutions from potential investors, financial institutions, consultants, associations, the central government and area.
PUPR Minister Basuki Hadimuljono said drinking water infrastructure and facilities were one of the basic infrastructures with vital influence on health and the environment. The development of the Karian-Serpong Regional SPAM through the PPP scheme is one of the priorities in maintaining optimism and sustainability of infrastructure development amid economic uncertainty due to the COVID-19 pandemic.
"So what we are doing today will definitely be very useful when the COVID-19 Pandemic passes. We want this project to be realized while fulfilling the RPJMN (National Medium Term Government Plan) 2020-2024 target to achieve 100% access to drinking water services," said Minister Basuki.
Minister Basuki added, the SPAM Karian-Serpong besides having great socioeconomic value for the supply of drinking water for the citizens of Jakarta, also became one of the efforts of environmental remediation for the city of Jakarta. This is mainly to prevent the continued drop of groundwater levels due to excessive use of groundwater in Jakarta.
"If the Karian-Serpong SPAM project is completed, then we can issue a policy prohibiting people from using groundwater. As long as it has not been completed, we will not be able to prohibit people from using groundwater, bearing in mind that so far the water needs are only supplied from Jatiluhur, West Java, so it is not enough," said Minister Basuki.
According to Minister Basuki, if the Karian-Serpong SPAM is completed then land subsidence in Jakarta can be stopped because we can prohibit the use of groundwater. "Thus the Karian-Serpong SPAM project is a large project because it can influence greater decision making later," said Minister Basuki.
Minister Basuki hopes that the construction of the Karian-Serpong SPAM PPP project can begin construction in 2021. This is so that the time lag between the completion of the Karian Dam construction target in Lebak, Banten, in 2021 and its utilization through the Karian-Serpong SPAM project is not too long.
"It is hoped that the tender can start as soon as possible and in the fourth quarter of 2020 a contract can be signed, so that construction is expected to begin in 2021 so that the project is likely to be completed in 2022 or 2023," said Minister Basuki.
The total capacity of the Regional SPAM is 4,600 lps for around 1.6 million residents in West Jakarta and surrounding areas. This system will serve the areas of DKI Jakarta (3,200 lps), Tangerang (650 lps) and South Tangerang (750 lps) with a 25.2 km transmission pipeline. The SPAM PPP contract period is planned for 33 years where the return on investment is carried out at the water tariff.
The Karian-Serpong Regional SPAM project is needed because of the limited scope of PAM Jaya services for DKI Jakarta. Existing services only reached 28.05%, while PDAM Kota Tangerang was 12.77% (to serve Kota Tangerang and Kota Tangerang Selatan). On the other hand, there are limitations to the state budget for infrastructure development, so it is necessary to accelerate SPAM project development through PPP scheme.
Meanwhile Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia who was also present in the virtual sounding market said, amid the national and global economic uncertainty due to COVID-19, infrastructure was one of the Government's priorities in mobilizing state revenues to attract investment and recover economic conditions. "We cannot remain silent in this difficult time. BKPM will fully support the action through becoming the front guard by facilitating the licensing process, construction to finalization, for whoever wins the tender," Bahlil said.
Also attending the video conference was the Managing Director of PT Penjaminan Infrastruktur Indonesia (PII) Muhammad Wahid Sutopo, Director General of Public Works and Housing Infrastructure Financing of the Ministry of PUPR Eko Djoeli Heripoerwanto, Director of Policy Formulation and Evaluation of the Directorate General of Public Works and Housing Infrastructure Financing Trisaputra Zuna, Director of Housing Infrastructure Financing Implementation Haryo Bekti Martoyoedo, and Head of the Public Communications Bureau Endra S. Atmawidjaja.
