PLN wants electricity tariffs raised this year
Thursday, March 8 2001 - 04:00 AM WIB
State electricity company PT Perusahaan Listrik Negara (PLN) has insisted that basic electricity tariffs be raised this year to ensure the continuity of the company's operations, according to PLN new president Eddie Widiono Suwondho.
Eddie said that PLN's operation would be endangered if the electricity tariffs were not raised and electricity subsidy was not disbursed.
"Without those two things, PLN will not be able to maintain its operation. Of course, there would be blackouts because we cannot buy fuels and coals," Eddie said after being inducted as PLN new president by PLN chief commissioner Endro Utomo Notodisurno, replacing Kuntoro Mangkusubroto.
He said that PLN would soon write a letter to the government about its proposal for the tariff increase, arguing that PLN currently sold electricity at undervalued prices.
"We all know that electricity tariffs cannot meet our operation. On the other hand, what's important for PLN is revenue requirement. If our operation can be met with tariffs at certain level, that will be good. But if not, we will still need the government's subsidy," he said.
Earlier, Kuntoro suggested that basic electricity tariffs be raised in July 2001. But the director general of electricity and energy usage at the Ministry of Energy and Mineral Resources, Luluk Soemiarso, said that the government had not yet planned any increase in electricity tariffs.
Edie said if the government insisted that there would be no electricity tariffs increase, it must cover in the form of subsidy the difference between PLN selling prices and production costs of electricity.
"If asked whether PLN needs the subsidy, the answer is resoundingly 'yes.' Don't say that PLN does not need the subsidy as long as the electricity tariffs are still undervalued," he said.
As reported earlier that the government's electricity subsidy for PLN, amounting to Rp 3.9 trillion, was still held by state Bank Mandiri. Some people said that the fund was deliberately parked at the bank to help the bank's liquidity position.
Meanwhile, former PLN president Kuntoro Mangkusubroto said that he had inherited a number of problems to his successor, namely the not-yet-completed financial restructuring of the company and the handling of 25 locations lacking of electricity supplies. (*)