PLN to restructure entire business organization

By Rikordias Dominius

State owned electricity firm PT Perusahaan Listrik Negara (PLN‎) plans to restructure its entire business organization to support the efforts of achieving the targets set in the government?s 35,000 MW power project program, a source said.

As part of the process, the firm will privatize some of its business, the source said, adding the restructuring will begin this month.

As part the restructuring, the firm will take actions as follows:

1. Its two power generation subsidiaries, Unit Pembangkitan Jawa Bali and PT Indonesia Power, will be merged.

2. All its regional units that currently operate power generation, transmission and distribution, will be privatized. This opens possibility for private companies to acquire PLN?s asset, with approval from regional governments (Pemda)

3. Transmission and distribution development units will be merged into a business entity called PT. Haleyora Power.

4. Administration unit will be merged to PT Icon+.

After being disintegrated, PLN will privatize the business units, so that each regional power companies will be responsible for everything in their respective areas, from procurement of power plants, transmission, distribution and sales.

The government has set the target for the ministry of energy and mineral resources and PLN to develop 35,000 MW power plants through 2019. Initially, PLN got a quota of 10,000 MW of the projects. However, in view of the firm?s financial problems, the government cut the quotas to 5,000 MW, raising the private investors? quota from 25,000 MW to 30,000 MW.

Editing by Johannes Simbolon