Regions allowed to develop own power plants

Regencies or provinces in Indonesia are now allowed to set up their own electricity tariffs as long as they can developed their own power plants, according to an official.

Director general of electricity and energy utilization Luluk Sumiarso was quoted as saying by the Bisnis Indonesia daily that setting up the regional tariff needed certain requirements, but did not provide clear details except that each regions must set up a power company which would be come a subsidiary of the state-owned electricity company PLN and that the plan must be approved by local stakeholders.

So far only the Batam industrial island which have been allowed to have its own power regional tariff.

The Tarakan regency administration in East Kalimantan province has proposed for a similar facility, but so far Jakarta has not given its approval.

PLN is under pressure to quickly develop more power plants to avoid power shortage over the coming years, but the company is also facing financial difficulties. Allowing regions to develop their own power should have ease the burden.(*)