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Some Companies See Power Hikes Well Above 18% Cap
Faisal Maliki Baskoro & Rizqon Bilhuda | August 03, 2010

Two engineers work on power cables owned by state electricity company PLN. PLN chairman Dahlan Iskan said the state firm plans to shut down four diesel-powered plants on Java island this year.  (Antara Photo/Yudhi) Two engineers work on power cables owned by state electricity company PLN. PLN chairman Dahlan Iskan said the state firm plans to shut down four diesel-powered plants on Java island this year. (Antara Photo/Yudhi)
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Jakarta.  Several industries have reported steep rises in their electricity rates for July, well above the 18 percent maximum increase promised by the government.

Ernovian Ismy, the secretary general of the Indonesian Textile Association (API), said on Monday that several members had seen rate increases of about 38 percent.

He declined to estimate the total number that had received excessive bills, saying the association was still gathering information from its members and would release a report on Aug. 15.

“We refuse to pay bills [above the 18 percent cap] because it’s not in line with the agreement between industries, the government and the House of Representatives,” Ernovian said.

He said the association would consider petitioning the House if too many members saw rate increases above the 18 percent cap, or if the state power company, Perusahaan Listrik Negara, was unable to correct the problem.

“Hopefully, it’s just a matter of poor coordination between PLN’s main office and its regional offices. But if this is intentional, that means PLN lied to us,” Ernovian said.

PLN’s president director, Dahlan Iskan, acknowledged the problem and suggested that poor administration and coordination might be to blame.

“The regulation is still new. It might just be that our offices at the regional level are still confused by the method of calculation,” he said. “But we welcome companies to file complaints if they feel the hike is above the cap. We’ll deduct it from next month’s bill.”

In June, the Energy Ministry issued a decree, with the approval of the House, raising electricity rates 6 percent to 15 percent for industrial users, effective in July.

However, industry leaders said the actual rise was 40 percent to 80 percent, with some even seeing their bills double.

PLN later acknowledged that “extra variable” fees meant to limit consumption had, in fact, raised rates by up to 40 percent for some industries. The government vowed to cap any increase at 18 percent.

Sofyan Wanandi, chairman of the Indonesian Employers Association (Apindo), said on Monday that some members had seen increases of 30 percent to 40 percent in their latest bills.

“Apparently there was a lack of coordination between PLN’s central office and its regional offices,” he said. “Some of the regional offices are still using the old method of calculation, but it’s been dealt with.

“Most of the companies affected are small malls and garment and handicraft companies.”

Sofyan said that in general, the association’s members had seen an average increase of 7.6 percent in their power bills.