PLN told to open tender for new power plants

Two legislators from the House of Representatives' Commission VIII on energy and mining, Pramono Anung and Husni Thamrin, have called on state electricity company PT Perusahan Listrik Negara to open new tender for the development of new power generators in Java and Bali to prevent possible power glut in the two islands by year 2003.

Both Pramono and Husni, nevertheless, said that the tendering of new power plants must be pursued in parallel with re-negotiations of electricity supplies and prices with the existing 27 independent power producers (IPP).

They said PLN must make it clear since the beginning of the tendering of new power plants that it could only buy electricity from any power producers at 3.6 U.S. cents per kilowatt hour (kWh).

"Just open the tender for the general public. The tender will select those who could build power plants at that level of electricity selling price (3.6 U.S. cents)," Pramono said.

Husni Thamrin added that when the new tender produced winners, at an agreed electricity selling price of not more than 3.6 U.S. cents, PLN could use the new pricing as a benchmark in its re-negotiation of contracts with the existing 27 IPPs.

"It means that re-negotiation with private electricity producers must still continue," Husni said, adding that the existing IPPs would then be compelled to lower the selling price of their electricity to a more realistic level for PLN.

PLN has predicted that Java and Bali will experience power glut by year 2003 if no new power generators are built until then. (*)