PLN asks govt to revise power rates regulation

Rangga D. Fadillah, The Jakarta Post, Jakarta | Fri, 01/21/2011 3:03 PM | Business

State electricity company PT PLN has recommended the government revise the 2010 ministerial decree on basic electricity rates, if the cap on increases to power rates for industries is to remain in place.

PLN business and risk management director Murtaqi Syamsudin said Friday that as an executor of government policies his company needed a clear legal basis to avoid problems that appeared to be caused by the excesses of government policies.

"The government and House of Representatives may make political decisions, but for us the most important thing is that they materialize their decisions into clear legal instructions," he told reporters in a discussion in Jakarta.

The electricity rates for industries have recently been in legal limbo since PLN announced it would lift a cap on power rate increases in early January.

Through a ministerial regulation, the Energy and Mineral Resources Ministry introduced new power rates in mid 2010. Business owners slammed the change, as calculations showed they would experience increases in power costs of between 20 and 30 percent.

As a compromise, the government and House agreed to cap the tariff increases at 18 percent, as of July 2010.

PLN price hike pushes water rates up.

The Jakarta Post, Jakarta | Wed, 01/19/2011 7:11 PM | Business

State-owned power firm PLN's decision to substitute LNG with crude oil to fuel Indonesia's power plants is forcing tap water operators to increase tap water rates by 30 percent, as operational costs have forced PLN to slash the operators' electricity cap allowance by 18 percent.

The chairman of Indonesian Tap Water Operators Association, Syaiful, said that the price hike was inevitable as PDAM used 60 percent of its electrical cap allowance for industrial processes.

"If the cap is reduced, it logically follows that our operational costs will increase", Syaiful was quoted as saying by metrotvnews.com.

In response to the planned increase of water rates, Public Works Deputy Minister Hermanto Dardak stated that in accordance with the Millennium Development Program 2015, the government would commit to the building of more than 8 million water installations that would reach areas that

currently had no access to clean water within the next 4 years.