The government is preparing to reduce electricity subsidies by promoting the use of renewable energy, particularly solar power (PLTS), according to Minister of Finance Purbaya Yudhi Sadewa.
Purbaya said the plan was discussed during a limited cabinet meeting chaired by President Prabowo Subianto on Thursday, September 18.
“The goal is to reduce subsidies without raising electricity tariffs for the public. We’re looking for cheaper sources of electricity generation,” Purbaya said during a press conference at the State Palace on Friday (Sept 19).
He emphasized that the government is not considering raising electricity tariffs as part of the plan. “This isn’t about increasing tariffs. This is about finding solutions,” he added in response to questions on possible price adjustments.
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Purbaya acknowledged, however, that electricity generated from solar power plants remains relatively expensive compared to coal-fired power plants (PLTU). To address this, the government is exploring new technologies to bring solar generation costs closer to those of conventional sources.
“There are already promising solar power designs, including plans to manufacture solar panels and batteries domestically. But the cost calculations still need refinement,” he said.
He added that while significant upfront investment will be required, solar energy is expected to lower electricity generation costs in the long term, eventually reducing—if not eliminating—the need for subsidies.
“If large-scale investment truly leads to cheaper electricity that can reduce subsidies over the next few decades, I wouldn’t hesitate to support it financially,” Purbaya said.
Editing by Reiner Simanjuntak
