Govt will raise electricity tariff after 2009

The government will raise the electricity tariff by about 10 percent only after 2009 or in 2010 to help the state- owned electricity company PLN to pay the electricity supply from coal-fired power plants currently being built under the power crash program, a senior official of the ministry for the supervision of state enterprises has said.

Speaking during a hearing with the House of Representatives (DPR) on Monday, deputy minister for supervision of state enterprise, Roes Aryawijaya said that based on PLN's estimated cashflow position during the period between 2006 and 2015, the company would only be able to pay the power supply from the new power plants, only if there is an increase in the electricity tariff by 10 percent after 2009.

Roes said that the government would maintain its commitment not to raise the tariff until 2009 and as a consequence, PLN would continue to receive a subsidy during the next two years to cope with the company's financial deficit.

In addition to the subsidy, PLN had also been encouraged to use regional tariff system to help reduce its financial deficit. "The regional tariff system can be adopted beginning this year. But for this purpose, the status of PLN units that would use different tariffs should first be changed into independent subsidiaries," he said.

According to him, the regional tariff system which has been adopted in Batam will be also applied in Bangka and Belitung, Riau islands and East Kalimantan. The change in tariff system in the three provinces are still under preparation, Roes said. (godang)