Government plans incentive for IPPs

The government plans to provide incentive for independent power producers (IPPs) in the form of a more attractive selling price of electricity in a bid to lure fresh investment in the sector, Bisnis Indonesia reported on Saturday.

The paper quoted Director General of Electricity Jarman as saying that the Ministry of Energy and Mineral Resources (MEMR) is set to issue a regulation on the new ceiling price of electricity to be sold by IPPs to state-owned electricity firm PT PLN.

?We plan to issue a regulation on the electricity reference price for the private sector (IPPs) this week,? Jarman said, without providing further details.

He acknowledged that lengthy negotiation of the electricity selling price with PLN has been seen as one of the factors causing delays to power plant projects developed by the private sector.

The government of President Joko Widodo plans to develop a combined 35,000 MW of power plants over the next five years in a bid to help accelerate economic growth and avert power crisis. PLN would develop about 15,000 MW, while the remaining 20,000 MW to be given to the IPPs. (*)