Govt proposes electricity price increase of between 5 and 15% in 2013

The government is proposing an increase of between 5 and 15 percent in electricity price in 2013 in order to reduce swelling energy subsidy, Investor Daily reported on Friday.

Speaking during a hearing with the Commission VII of the House of Representatives, the Director General of Electricity at the Energy and Mineral Resources Ministry on Thursday, Jarman, said that the price increase could be begun in January or April.

Jarman said that if the price increase is implemented beginning Jan. 2013, the subsidy would reach between Rp 80.55 trillion and Rp 84.8 trillion. ?The amount of the subsidy is based on assumption of 8 percent growth in the electricity demand and Indonesian Crude Price (ICP) of between $100 and 120 per barrel,? he added.

Meanwhile, if the price increase is to begin in April with an assumption of electricity growth of 9 percent, the subsidy would reach between Rp 85.1 trillion and Rp 86.14 trillion. If the price increase is begun in January, with an electricity growth assumption of 9 percent, the subsidy would reach between Rp 80.12 trillion and Rp 84,48 trillion.

?If there is no price increase, the subsidy will reach between Rp 91.39 trillion and Rp 100.32 trillion,? he added. (*)