PLN, Paiton agrees on a power price of 2.3 cent dollar per Kwh
Tuesday, March 7 2000 - 02:00 AM WIB
The state electricity company PT Perusahaan Listrik Negara (PLN) reached a temporary agreement with independent power producer (IPP) Paiton Energy to buy power from the latter at 2.3-cent dollar per Kwh.
"That's what I heard. But we still have to ask whether there's a compensation to be given by the government after Paiton agrees to lower its power selling price," said a legislator who declined to be named.
The 2.3-cent dollar per Kwh is within the price range demanded by the government, which had asked for a price level of below 2.5-cent dollar per Kwh.
Under the earlier contract signed by PLN when the former authoritarian ruler Soeharto was still in power, Paiton set its power selling price at 8.5 cent dollar per Kwh.
PLN declined to honor the contract after Soeharto tumbled, citing the fact that it was forced to sign the power purchase contract, and that following the contract would send the company into bankruptcy. The company instead sued Paiton in a Jakarta Court.
PLN also signs similar power purchase contract with 26 other IPPs. Paiton is the largest.
But the Administration of Abdurrahman Wahid stepped into the controversy, and decided to seek out of court settlement over the PLN-IPPs dispute.
PLN president Kuntoro Mangkusubroto confirmed on Monday that PLN had reached a temporary agreement with Paiton Energy over a dispute contract.
Kuntoro said that under the agreement two sides agreed not to sue each other during the renegotiation period. He said that the renegotiation would start next month and was expected to be completed within 10 months.
Meanwhile, the Bisnis Indonesia daily quoted Kuntoro as saying that PLN would purchase power from Paiton during the 10-month period.
"Concerning the price, you better ask the Coordinating Minister for Economy, Finance and Industry Kwik Kian Gie," he told reporters on the sidelines of a hearing session with the House of Representatives commission VIII on mining and energy.
Kwik is the head of the country's electricity tariff restructuring team. (*)