Indonesia needs US$800 million to cope with electricity crisis

The government will need at least US$800 million to cope with the acute shortage of electricity supply in the country, Minister of Energy and Mineral Resources Purnomo Yusgiantoro told reporters on Monday following a limited Cabinet meeting on economy.

The minister said that the power crisis had taken place in 28 areas in the country with a power supply shortage of 313 Megawatts. According to Purnomo, there are three alternatives to cope with the electricity problem; seeking two-step loans for PLN, inviting private companies to build new plants and encouraging provinces to provide electricity supply.

However, the minister said that the most possible way to cope with the shortage problem at present was to seek financial assistance. "If the situation is not conducive, it will be difficult to expect private companies to enter the business sector," he said.

According to PLN?s Eddie Widiono several countries have offered to provide financial assistance to help cope with Indonesia?s power crisis problem. "If the loan is approved, we can use it to buy equipment to solve the power problem," he added.

Meanwhile, the director general of electricity and energy utilization, Luluk Sumiarso, said that the government had issued a ruling to encourage the private sector to build power plans for the public. Under the ruling, private companies are allowed to build small-scale power plants with a generating capacity of up to 10 MW. (*)