IPPs to be allowed to sell electricity directly to consumers

Petromindo|Boim

The government will allow private power companies, or independent power producers (IPPs), developing power plants in remote areas to sell their electricity output directly to consumers in a bid to help accelerate the provision of electricity in remote regions, Bisnis Indonesia reported on Friday.

Under the current system, IPPs must sell their electricity output to state-owned electricity firm PT PLN, which then sells the power to the consumers.

The paper quoted Minister of Energy and Mineral Resources Ignasius Jonan as saying that the ministry is currently drafting a new ministerial regulation that would allow IPPs or local government-owned companies (BUMD) developing power plants in remote regions to build their own transmission lines, which will not be connected with PLN?s transmission lines (or off grid), so that they can sell their electricity output directly to the consumers.

?If for instance districts have hydro, solar, or biomass potential, they can develop their own power plants and sell directly to the consumers. They don?t need high voltage transmission,? Jonan said.

He said that the electricity price will be set the same as the price applied by PLN. He added that the new ministerial regulation will also include subsidy scheme. (*)