The electricity tariffs to rise by 6% in every three months

The government will increase electricity tariffs by an average of six percent in every three months this year in a bid to help the troubled electricity company PLN cope with its financial difficulties, Kompas reported on Tuesday.

The first six-percent increase became effective in the first of the January, while the next increase will be made on April 1, July 1 and October 1.

PLN?s president Eddie Widiono said in Jakarta on Monday night that the increase was made in accordance with a compromise with members of the House of Representatives.

According to Eddie, the increase would add PLN?s revenue by Rp 5.4 trillion or an increase of 16 percent. However, PLN would still suffer a deficit of Rp 200 billion because the company?s total revenues of Rp 43.7 trillion would be still lower than its total spending, which reached a total of Rp 43.9 trillion.

PLN revenues will come from sales, which are expected to reach Rp 39 trillion and government? subsidy of about Rp 4.1 trillion and sales of around Rp 500 billion.

According to Eddie, despite the increase the company?s operating costs of Rp 466 per kWh is still higher than the average sales of Rp 425 per kWh. This will cause an operating loss of about Rp 1.6 trillion. (*)