PLN to seek massive loans for expansion<\/p>\n
Moch. N. Kurniawan, The Jakarta Post, Jakarta<\/p>\n
The state-owned electricity company PLN said on Tuesday it was
\nplanning to seek foreign loans of between Rp 99 trillion (US$9.5
\nbillion) and Rp 141 trillion until 2005 to finance expansion
\nprograms aimed at meeting growing power demands in the country.<\/p>\n
PLN president Eddie Widiono said that PLN would use the loans
\nto finance the development of at least 47 power generating units
\nand 14 transmission lines across the country.<\/p>\n
\"The funds will be enough for us to maintain our power supply
\nto meet future growing demand,\" he told a press conference
\nfollowing a meeting with senior economic ministers.<\/p>\n
He added PLN had made loan proposals to several foreign
\nfinancial institutions including from Japan, Denmark, Belgium and
\nGermany.<\/p>\n
He didn't provide the names of the institutions.<\/p>\n
According to him, the country's power demand would grow by an
\naverage of at least 3.4 percent per year until 2005.<\/p>\n
But he said the power demand might grow by 3.8 percent for
\nJava and Bali, and 4.4 percent for other areas, should the
\ncountry's economy grow better than expected.<\/p>\n
\"In this case, we need Rp 141 trillion to meet the demand,\" he
\nadded.<\/p>\n
PLN has said that 24 critical systems outside the Java-Bali
\ngrid in 2002 will experience power shortages because of
\ninsufficient funds.<\/p>\n
It also said that Java and Bali would experience power
\nshortages in 2004 due to the lack of generating capacity and
\nrising demand.<\/p>\n
At present, PLN's generating capacity stands at 18,600
\nmegawatts (MW), while demand at the current peak reaches 17,000
\nMW.<\/p>\n
It added the state utility did not have the financial ability
\nto build new generating units to match the country's future power
\ndemands.<\/p>\n
Elsewhere, Eddie said that PLN's net loss declined to Rp 1.8
\ntrillion in 2001 from Rp 24.6 trillion in 2000.<\/p>\n
He said the government's decision to write off Rp 20.8
\ntrillion of PLN's debt helped improve the company's bottom line.<\/p>\n
In addition, an average 17.47 percent increase in electricity
\nprices last year, and successful deals in reducing power rates
\nwith several independent power producers had also helped PLN
\nminimize its losses, he said.<\/p>\n
PLN expected its loss to further drop to Rp 200 billion this
\nyear, he added.<\/p>\n
The rupiah's sharp fall against the dollar following the 1997
\nAsian currency crisis had badly affected PLN's bottom line. This
\nis because it sells electricity in rupiah, but most of its
\noperating costs are in U.S. dollars.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/pln-to-seek-massive-loans-for-expansion-1447893297",
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"sponsor": "Okusi Associates",
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