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Real Estate in Bali – #3 Infrastructure, Energy and Water

Posted by Andrzej Barski on 28th July 2017
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Real Estate in Bali infrastructure

This is the third in a series of six posts that looks at issues raised a year ago by Terje H. Nilsen, co-owner of Seven Stones Indonesia, in a blog entitled “What’s Wrong With Real Estate in Bali?

The third issue we’re looking at today is about Infrastructure, Energy and Water.

What Terje spoke about last year was in general the island’s infrastructure, energy and water were the biggest threats in the short to long term. And unless there was some serious political will to address them head on Bali could be facing some serious issues sooner rather than later.

So, what, if anything has happened in the last 12 months?

Let’s look at each area separately. First, infrastructure.

Have there been any infrastructural projects, like new roads or bridges that would go some way to alleviate the rapidly worsening congestion problems?

“Unfortunately, there’s not a lot to report,” says Terje. “It’s still a massive challenge and a very serious threat. But we’re hearing that after many years of speculation, late this year or early next, the extension of the Sunset Road will begin. New drawings of the final path have just recently been released.”

Those of you who are familiar with this project will know there have been more ‘fake news’ stories with ‘confirmed’ plans and drawings for years. So let’s wait and see if anything really moves forward.

“Another project in the pipeline is up North,” says Terje. “Where, according to recent news reports a new airport is slated to be built. There’s also talk of larger roads for the South. In general, I’d have to say we’re seeing much better maintenance of existing infrastructure and some good upgrades. Ngurah Rai International Airport, for example, has won several prizes as one of the best in the world in its class.”

Secondly, what about alternative energy initiatives? Did the local government get to install solar panels on every government building as they said they were going to do? Have there been any other initiatives or are there any more being planned?

“Short answer is no,” says Terje. “And it’s somewhat disappointing because there are more and more companies pushing to roll out alternative energy options from solar panels and storage to garbage management to geothermal. Not a lot of people know this but there is in fact, a fully functional geothermal power station already in Bedugul, which could easily increase its capacity. However, the existing government haven’t been very supportive of this for whatever reason.

“I think it’s fair to say wIth alternative energy in general and solar power in particular, it still boils down to political will. Opportunity and support for investors, entrepreneurs and companies ready to implement these initiatives on a larger scale should be more forthcoming.”

Let’s hope that changes. We’re big supporters of alternative energy and the central government’s initiatives to have 25% of the country with off-grid power by the year 2025. We see massive potential for Bali and the rest of Indonesia to be a major force in this regard.

Finally, water. It’s another big challenge. Last year Terje suggested the government, or those powers capable of doing so, should try to enforce hotels and housing projects to recirculate and reuse water. The question we want to ask now, is has this been done?

“Thats’s a very provocative question,” says Terje. “Because water is indeed a hugely critical issue, if not THE major issue. Both new and old hotels should be made to recycle. Today they’re not. And they don’t. But they must! Rivers could be used to prevent polluted water from reaching the sea, which would also clean the water systems all the way inland. This could be done, but it’s not being done. At least not fast enough. There are some companies we know of with good government contacts looking to explore opportunities in this field and we hope the future will bring some positive steps forward. But the truth is we need it done now!”

Many thanks for your time and insights Terje and I look forward to posting the fourth instalment of our series on Market Forces in Bali Real Estate.

Andy writes on a variety of topics related to property, real estate, the customer experience, mindset training and local/international trends for Seven Stones Indonesia. You can read some of his blogs here.

Seven Stones Indonesia is a property company headquartered in Bali, Indonesia, with a mission to help people who are interested in buying and selling residential and commercial real estate.

If you’re thinking about property, ROI, capital gains or lifestyle investments in Bali, Jakarta, Surabaya, and Indonesian’s Eastern Islands and need some friendly advice and guidance then why not email hello@sevenstonesindonesia.com or check out Seven Stones Website | Seven Stones Linkedin | Seven Stones Facebook

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