PLN extends talks on power rate dispute<\/p>\n
JAKARTA (JP): State electricity company PT PLN agreed on
\nThursday to extend power rate negotiations with industrial users
\nuntil December, when a decision would be made by the government
\neither to accept or dismiss their requests for downward revisions
\nof new power rates.<\/p>\n
\"We will maintain the status quo of the current situation;
\nbut, if by the end of this year the government turns down their
\nsuggestions, we will stick to the new power rates,\" PLN president
\nKuntoro Mangkusubroto told reporters after a hearing with the
\nHouse of Representatives' Commission V, which oversees industrial
\naffairs.<\/p>\n
The hearing was also attended by leaders of the Association of
\nIndonesian Textile Industries (API), the Association of
\nIndonesian Synthetic Fiber Producers (APSyFI), the Association of
\nIndonesian Apparel Manufacturers (AMI) and the Association of
\nBillets, Iron and Concrete Factories (ABBESI).<\/p>\n
They have been protesting against a government decision in
\nApril to increase power rates by 53 percent to 76 percent for
\nindustrial users.<\/p>\n
The associations have suggested a gradual increase of
\n20 percent this year up to 101 percent by September, 2002.<\/p>\n
Kuntoro has advised them to forward their complaints and
\nsuggestions to the government, as PLN has no authority to reverse
\na government decision.<\/p>\n
\"If the government doesn't respond to the suggestions, we will
\napply the 2000 power rates,\" he said.<\/p>\n
He added that should the government approve a gradual
\nincrease, PLN would reimburse the companies that have paid their
\npower bills under the current schedule.<\/p>\n
During the hearing, it was agreed that PLN would not
\ndisconnect the power for industrial users that were still in
\nnegotiations.<\/p>\n
However, Kuntoro warned that firms refusing to negotiate or
\npay their bills, risked disconnection.<\/p>\n
\"We will disconnect them, and we can do it next week,\" he
\nsaid.<\/p>\n
He further dismissed the associations' claims that they
\nrepresented the nation's industries.<\/p>\n
According to him, since April, overdue payments owed by PLN's
\ncustomers nationwide have cumulatively reached Rp 600 billion
\n(US$68 million), of which Rp 400 billion is owed by only 29
\nfirms.<\/p>\n
\"While 1.1 million people still can't enjoy electricity, they
\n(the 29 firms) don't pay their bills. How are we supposed to fund
\nour expansion?\" Kuntoro said<\/p>\n
Data from PLN showed that the 29 firms were largely members of
\nassociations attending the House hearing. They included, among
\nothers, PT Texmaco Jaya, PT Texmaco Taman, PT GT Petrochem, PT
\nIndorama Technology, PT Master Steel and PT Konikotex.<\/p>\n
\"It's up to you (House members) to judge whether those
\ncomplaining over the tariffs can be considered representatives of
\nindustrial associations or whether they are just fighting for
\nindividual company interests,\" Kuntoro said.<\/p>\n
But API vice chairman Lili Asdjudiredja denied Kuntoro's
\nobservation, claiming that almost all members of his association
\nrefused to pay their electricity bills according to the new
\ntariffs.<\/p>\n
\"We still pay our bills, but under the old power rates,\" he
\nexplained.<\/p>\n
He said the government should adopt a gradual price increase,
\nsince many companies were facing simultaneous increases in other
\ncost components.<\/p>\n
Lili cited the 20 percent increase in the regional minimum
\nwage in April and another 24 percent in September, and the
\naverage 12 percent increase in fuel prices from early this month.<\/p>\n
Lili predicted that the sudden jump in production costs would
\nforce the textile industry to scale back its export target this
\nyear by around 10 percent from an initial target of US$7.8
\nbillion.<\/p>\n
Separately, news agency Antara quoted Minister of Energy and
\nMineral Resources Purnomo Yusgiantoro as saying on Thursday that
\nPLN had requested the government to bail out its $1.33 billion
\ndebt.<\/p>\n
He said the government had received PLN's application for the
\nbailout on its debts to independent power producers (IPPs).<\/p>\n
\"The government will discuss PLN's request with the team
\nassigned through Presidential Decree No 133 to restructure PLN's
\nfinancial structure,\" he said, before attending a limited Cabinet
\nmeeting chaired by Vice President Megawati Soekarnoputri.<\/p>\n
Over the years, PLN has failed to pay for the electricity it
\nhas purchased from the IPPs.<\/p>\n
In the first half of this year, PLN recorded net revenues of
\nRp 10.11 trillion, up 30 percent from the same period last year,
\nmainly due to the new power rates.<\/p>\n
However, during the same period, the state company recorded a
\ntwelve-fold increase in losses to Rp 11.58 trillion, as
\nagainst last year's first semester loss of Rp 974 billion. (bkm)<\/p>",
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