PLN's fuel spending may increase by 150% this year

State owned electricity company PLN's fuel spending may increase by about 150 percent this year to Rp 35.41 trillion from the initial estimate of about Rp 14.50 trillion last year due to the increase in the company's fuel needs during the year.

PLN president director Eddie Widiono Suwondho said in Jakarta on Wednesday that besides in the increase in the fuel use, the sharp rise in the company's fuel spending was also due to the fact that the company had to buy part of its fuel needs at market prices.

"There will be an increase in the fuel spending if we have to buy the fuel for the rest of the year at market prices," Eddie said.

PLN needs about 11.44 million kilo liters of diesel oil this year but the government through Pertamina is able only to provide the subsidy for the purchase of 8.7 million kilo liters. The electricity company should buy the remaining fuel needs at market price.

In order to reduce the fuel use in the future, PLN would modify its diesel oil fired power plants so that such power plants would be able to use gas or coal, Eddie said, adding that this program would result in the increase in the gas use by about 235 million cubic feet in 2006 and by about 360 million cubic feet in 2007 from about 581 million cubic feet this year. (godang)