PLN NO LONGER ABLE TO SOLVE POWER PROBLEM ALONE By Andi Abdussalam

Jakarta, Nov 17 (ANTARA) - State-owned electricity company PLN, due to its limited capacity, is no longer able to meet the people's need for power which continues to increase at a rate of between six and eight percent or between 2,000 and 3,000 megawatts per annum.

The increase in demand for electricity supply has caused a power deficit which leads to power outages and rotating blackouts in different regions. In October 2009, for example, PLN suffered a power deficit of 460.2 MW.

For 2010 alone, PLN will need at least Rp32 trillion in funds to improve national electricity supply. Besides, it also needs to offer a chance to other parties to help develop the country's electricity.

In response to the problem of power outages which sparked complaints from consumers, households and industries, President Susilo Bamang Yudhoyono summoned his related ministers and officials to discuss the power problem on Tuesday.

The president summoned Coordinating Minister for Economic Affairs Hatta Rajasa, State Enterprises Minister Mustafa Abubakar, Energy and Mineral Resources Minister Darwin Saleh, state-owned electricity firm PLN's Director Fahmi Mochtar and Jakarta Governor Fauzi Bowo to discuss the problem of power deficit in the country.

"PLN is no longer able to handle the problem alone. It has limited capability so that a chance to help develop electricity should also be offered to other parties," President Yudhoyono said.

In order to increase its capacity, the president asked PLN to improve its management both in financial and distribution terms so that consumers would no longer have to suffer power outages as a result of PLN's mismanagement.
"I want PLN which runs a big business of trillions of rupiah to exercise good governance. It should not show peculiarity as it would sacrifice the people," the president said. The head of state is also of the opinion that the state power company also still faced problems with coordination and synergy such as slow response to proposals from the regions while a number of regions were also not smart in taking serious steps to solve electricity problems.

According to Chief Economic Minister Hatta Radjasa, the president summoned the relevant ministers to listen to explanations, including the PLN director on complaints from industries and citizens about frequent power outages.

Hatta said the government was trying to formulate ways to find a comprehensive solution to the electricity problems. The solution would have to be for the short, medium and long terms. He said with electricity consumption growing at six to eight percent or 2,000 - 3,000 MW per annum, it was impossible for PLN to cover the entire shortage in power supplies.

"Therefore, we have encouraged independent power producers (IPP) to enter the electricity sector. But of the 50 existing IPPs, only about 20 percent can do it. Even so, the 20 percent are now also facing financial problems," he said.

In the meantime, Jakarta Governor Fauzi Bowo said many of the complaints about power cuts in Jakarta came from small and medium scale industries who did not own generators.

"We have asked PLN to speed up finding a solution to the power problem. Now, a number of small and medium scale industries who have no generators, have stopped their businesses due to the power outages," the governor said.

The governor said the electricity blackouts were also often causing chaos in the streets of the capital because traffic lights were not operating which resulted in chaotic traffic jams.

In the meantime, data made available to ANTARA on Tuesday indicated that PLN in October 2009 suffered a power deficit of 460.2 Megawatts. 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 normal condition.

The state-owned power utility company divided the conditions of its power distribution systems into three categories, namely normal, on alert and in deficit of power supply.
In normal conditions, PLN does not impose a rotating power cut because it has enough power reserves for operations. The alert condition indicates that PLN does not impose a power cut but it has the potential to cut power because its power reserves are smaller. The deficit condition causes PLN to impose rotating power outage because its capacity to supply electricity is smaller than the needed one during peak load, or there is a disturbance in the transmission system.

In the meantime, PLN President Director Fahmi Mochtar recently his company needed Rp32 trillion in funds to improve national electricity supply in 2010.

"The funds will be used for various purposes, ranging from power plants, transmission to distribution networks to be able to meet our power needs," he said. Fahmi said the Indonesian economy was projected to grow 4.0 percent this year.

If it was to be geared up to expand 6 percent next year, power supply must grow 9 percent and therefore, Rp32 trillion in funds would be needed in 2010 alone.