The plan to build Muara Tawar power plant might be cancelled

The government?s decision to delay the plan to increase the electricity tariff might lead to the cancellation of the planned construction of the Muara Tawar power plant which will be built as part of the state owned electricity company PLN?s priority program to cope with the shortage of the electricity supply in Java and Bali, Bisnis Indonesia reported on Tuesday.

PLN?s president director Eddie Widiono said the construction of the power plant relied much on the increase in the electricity tariff because the funding for the construction would mostly come from the rise in the electricity tariffs.

"The income resulting from the rise in the electricity tariff will be allocated as PLN?s investment to build new electricity distribution networks and new power plants including the Muara Tawar power plant," he said.

PLN recently launched the tender for the construction of the Muara Tawar plant in Bekasi, West Java.

The bidders of the gas power plant, which will have a capacity of 6 X 100 MW and will be built with an investment of about US$400 million, include Samsung Corp Engeneering & Construction, Hyundai Eng & Const. CO, Ltd, PT Adi Karya, Egeneral Electric Int, Inc, PT Hutama Karya, PT Indonesia Power, PT Siemens Indoensia, Mitsui & Co. Ltd, PT Mitsubishi Corporation, PT Tripatra Engineers, Sumitomo Corporation and PT Marubeni Indonesia.

The government recently delayed PLN?s plan to increase the electricity tariff by an average of six percent per three months due to a widespread opposition from the public. PLN initially planned to launch the new tariff, which had in fact received approval from the House of Representatives (DPR), in January, last month. (*)