Forecasting risk and return to provide electricity in Batam, Indonesia by using Efficient Frontier

Electricity is the main driver of the economic activity in a country. In Indonesia, the fuel of electricity system is still coming from the natural resources. Batam has strategic position among other areas in Indonesia to have the highest electrification ratio as it has connected with the gas pipeline, which enables to supply gas to Batam for generating electricity and further to, meet the request by Singapore to export electricity. This thesis discussed on the forecasting risk and return to provide electricity in Batam for domestic purpose and to export to Singapore by using Efficient Frontier. Exporting electricity to Singapore will improve the electricity system in Indonesia, increase the profitability of the power plant in Indonesia, create employment in Indonesia and maximize the natural resources for domestic usage.