Electricity tariff may increase by between 18% and 48%

The increase in the electricity tariffs this year will likely reach between 18 percent and 48 percent according to the tariff price scenario being prepared by the government and state owned electricity company PLN, Kompas reported on Wednesday.

According to a source at the ministry of finance, the government had approved a number of tariff increase scenarios but Minister of Finance Boediono said that the government had not made a final decision.

Boediono said that there would be more meeting to discuss the ideal tariff increase for PLN. "We are still calculating the tariff increase," he said.

According to the existing proposals, the percentage of the electricity tariff increase will depend on the amount of the subsidy to be given by the government to PLN.

If the tariff increase, for example, is limited only to between 18 percent to 20 percent, the subsidy that should be provided by the government would reach Rp 14 trillion, or if the tariff is increased by about 48 percent, the government will no longer need to provide the subsidy. (*)