PLN proposes new electricity tariff formula

State-owned electricity company PT PLN is proposing a new formula to determine electricity tariff in the country as the existing formula is no longer suitable.

PLN Director for Corporate Planning Nicke Widyawati was quoted by Bisnis Indonesia as saying Thursday that the current formula under which the electricity tariff is determined based on development in oil price, inflation and exchange rate of the rupiah against the US dollar must be revised as it does not reflect the current energy mix in the country?s power plants.

She pointed out that fuel oil now only accounts for about 7 percent of fuel source for power plants in the country as coal has become the dominant source of the fuel, and the use of other energy sources is also on the rise.

?The energy mix has greatly changed. So we propose that the (electricity) tariff to take into account the energy mix.? Nicke said.

According to PLN data, per May of this year, fuel oil in power plant operated by PLN and independent power producers accounted for only 7 percent, coal 54.6 percent, gas 25.7 percent, geothermal 4.4 percent, and hydro 8.3 percent. (*)