POWER SHORTAGE FEARED TO AFFECT INDUSTRIES

By Andi Abdussalam


        Jakarta, Dec 4 (ANTARA) - The shortage of electricity supply and the frequent power outage and rotating blackouts are feared to affect industrial activities and slow down investment.

        Therefore, the House of Representatives (DPR) urges the government to take the necessary steps immediately to solve the power supply shortages, and seek short, middle and long term solutions.

        The most urgent step the government has to take is to find short-term solutions to the frequent electricity outage and rotating power cuts.

        "It is important to overcome the problem quickly because disrupted power supply will hamper industries, including small-scale industrial enterprises in their production activities," House Speaker Marzuki Alie said here on Friday.

        The House has been accommodating complaints lodged by the public against disrupted power supplies as a result of damage to power generators that also disturbed power supply to a number of industrial centers.

        Business players have been complaining of late and are worried about the power shortage that could affect their investment activities and production capacity. After all, the public are also seemingly of the view that the government and state-owned power utility firm PLN might face problems with securing investment activities in Indonesia if they are not able to solve the power crisis.

        It seems now that PLN, due to its limited capacity, is no longer able to meet the people's need for electricity which continues to increase by six and eight percent, or by 2,000 to 3,000 megawatts per annum.

        The increase has caused a power deficit which leads to power outages and rotating blackouts in many regions. In October 2009, for example, PLN suffered a power deficit of 460.2 MW. The data showed that of the 24 power distribution systems, 11 experienced a power deficit, two were under an alert status and the other two were in a normal condition.

        In 2010 alone, PLN will need at least Rp32 trillion to improve the national electricity supply, and also needs to offer a chance to other parties to help develop the country's electricity sector.

        In response to the problem of power outages which had sparked complaints from the consumers, households and industries, President Susilo Bamang Yudhoyono summoned the ministers and officials concerned last month to discuss the problem.

        The steps the government is considering include efforts to restructure PLN's management by replacing its president director and to raise electricity prices (TDL).

        "We have conducted a fit-and-proper test this week at the Ministry of State Enterprises (BUMN) and will hand over the results to a selection team (TPA) next week," State Enterprises (BUMN)Minister Mustafa Abubakar said here on Friday.

        The names of prospective successors of PLN's president director Fahmi Mochtar are to be submitted to President Susilo Bambang Yudhoyono next week. The president is the chairman of the TPA team whose members are the minister for energy and mineral resources, the finance minister and state enterprises minister.

        Two of the prospective successors are two from PLN itself, while the third one is an outsider, namely Dahlan Iskan, chief executive officer of the Jawa Pos Group. But up to Friday, the names from PLN itself were still kept a secret.

        "We can reveal the name of Dahlan because the media had placed him under their spotlight. However, we cannot yet disclose the two names," Minister Abubakar said.

        Dahlan Iskan is known as not only as owner of a media business group but also as an independent power producer (IPP) in Kalimantan. It seems however that he might face opposition from PLN employees who wanted the state firm to be led by a person from among themselves.

        Besides replacing the PLN top post official, the government is also considering raising the TDL by 10 to 20 percent.

        "The government is considering two things in raising the TDL, namely that the rates not only be able to provide a profit for the survival of PLN, but also reflects the purchasing power of the people," Energy and Mineral Resources Minister Erwin Saleh said.

        He said that TDL raise by 10 to 20 percent had been set by the government and the House of Representatives (DPR). The formulation of the TDL is now under intensive discussions by, among others, expert staff of the energy and mineral resources ministry, the electricity director general and first echelon officials of the finance ministry.

        "We are now discussing its formulation, which includes how the new rates should be fixed and when it would be imposed," he said. If the rates are too low, PLN could not develop it because it would affect the lowest layers of the people.

        "So, we will continue to financially protect the weak consumers, but would not spoil the big customers," the minister said.***2*** (T.A014/a/H-NG/a014)