Minister to issue new ruling on tariff of electricity from mine mouth plant
Saturday, February 11 2017 - 04:08 AM WIB
Petromindo|Boim
Minister of Energy and Mineral Resources Ignasius Jonan is set to soon issue a new ruling on selling price of electricity from mine mouth power plant to state-owned electricity company PT PLN, Kontan reported on Saturday.
The paper quoted Director General of Electricity at the ministry Jarman as saying that the tariff formula for electricity from mine mouth power plants developed by independent power producers (IPPs) will be the same as the new tariff formula for electricity from renewables, which is limited at 85 percent of the PLN electricity production cost base (or better known as BPP).
He added that the new tariff will be applied for mine mouth power plants both developed by coal mining firms or non-coal mining firms.
The current tariff of electricity from mine mouth power plants, according to Ministerial Regulation No 34/2016, is set based on a formula of production cost plus margin of between 15-25 percent.
Jarman said that electricity selling price in neighboring countries such as Malaysia and Thailand have been linked to BPP, which reflects the economics of the power plant.
President Director of PLN Sofyan Basir welcomes the planned new policy saying it would help lower the selling price of electricity by the utility to consumers.
Arthur Simatupang, Executive Chairman of Indonesian Independent Power Producers Association (APLSI) said that the planned new tariff formula will only be attractive to IPPs in regions where the BPP is high. He added that the government must be transparent in determining the BPP. (*)