President disappointed with progress of 35,000 MW project
Wednesday, November 2 2016 - 02:53 AM WIB
The president said in a statement issued by the Cabinet Secretary following a limited cabinet meeting that the State Development and Finance Audit Agency (BPKP) will be assigned to audit the stalled projects to look into the financial losses suffered by the state before handing them over the KPK.
Jokowi said that as per October 24, only 9.4 percent of the planned 35,000 MW projects have reached commercial operation date status. ?I want to know what the obstacles are. I want all to be evaluated one by one, so that we could know what the problems are to be immediately resolved,? he said in the statement, adding that all related parties must work hard to realize the program.
The administration of President Jokowi launched the five-year 35,000 MW program two years ago in a bid to increase electricity supply in the country to help accelerate economic growth. The 35,000 MW program, which is supposed to be completed in 2019, includes the unfinished 7,000 MW projects launched under the previous administration. Of the total 35,000 MW projects, 25,000 MW are allocated to private investors (independent power producers), while the remainder 10,000 MW to be developed by state-owned electricity firm PT PLN.
Meanwhile, PLN President Director Sofyan Basir that of the 34 stalled projects, 12 have been really suspended, 12 others can be continued, and the remainders are still being negotiated with investors.
He also said that progress of the 35,000 MW projects are still in line with the target.
Sofyan was quoted by The Jakarta Post as saying that the slow progress of the power plant projects is partly due to the slow process by the Ministry of Finance in issuing the business feasibility guarantee required by the independent power producers to raise funds from overseas banks particularly those involving Japanese companies.
He said that a majority of projects funded by Chinese investors have not been stalled as they don?t require the guarantee.
Elsewhere, Jokowi also called for giving priority for the development of renewable-based power plants in the country.
Editing by Reiner Simanjuntak