Power industry watchdog expected in September: Official<\/p>\n
A'an Suryana, The Jakarta Post, Anyer, Banten<\/p>\n
The government hopes to set up a power industry watchdog, to be
\ncalled the Power Market Supervisory Agency, by September, a
\nsenior government official said.<\/p>\n
The director for electricity business supervision at the
\ndirectorate general of electricity and energy, J. Purwono, said
\nhis office was currently finalizing a government decree on the
\nestablishment of the agency, and expected the decree to be
\napproved in July.<\/p>\n
\"By September this year the supervisory agency is expected to
\nbe established,\" he said during a gathering with journalists on
\nWednesday.<\/p>\n
The Power Market Supervisory Agency will act as the watchdog
\nfor the power sector once the industry is liberalized, possibly
\nstarting in 2007.<\/p>\n
The agency, among other tasks, will determine which provinces
\nin the country are ready for market competition and which will
\nremain under government control. The watchdog also will be in
\ncharge of ensuring fair market competition for mid-size and large
\nconsumers and determining power prices for small users.<\/p>\n
The state electricity company, PLN, will gradually lose its
\ndecades-long monopoly in power generation, transmission and
\ndistribution to mid-size and large users, with private investors
\nbeing allowed to enter the sector as part of the electricity law
\napproved by the House of Representatives last year.<\/p>\n
However, to protect small electricity users, the government
\nwill retain full control over the power industry in areas deemed
\nunready for open competition.<\/p>\n
Java, Bali and the industrial island of Batam will likely be
\nthe first areas to see open market competition, because many
\nelectricity users in these areas are commercial customers.<\/p>\n
Purwono said that according to a draft of the decree on the
\nsupervisory agency, the body will be made up of at least five
\nmembers.<\/p>\n
He said the Ministry of Energy and Mineral Resources would
\nselect the members of the agency and would propose them to the
\npresident and the House of Representatives for approval.<\/p>\n
\"The membership is open, but the members must not have any
\naffiliation with political parties or power companies to maintain
\nthe agency's integrity,\" Purwono said.<\/p>\n
Analysts have said the integrity of the agency is crucial to
\nensure the drive to liberalize the power sector is successful.<\/p>\n
Ending the monopoly of PLN is key to encouraging new
\ninvestment in the power sector.<\/p>\n
However, a number of different parties have campaigned against
\nthe liberalization drive, arguing that open market competition
\nwould result in a sharp increase in power prices, as occurred in
\nother countries.<\/p>\n
The government, however, has said the competition would
\nencourage more investment in the power sector, and power
\nproducers would vie to provide the best service to customers.<\/p>\n
There have been numerous blackouts around the country over the
\npast two years, and there are worries the situation will worsen
\nin the coming years unless the government is able to attract more
\ninvestment to the power sector.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/power-industry-watchdog-expected-in-september-official-1447893297",
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"sponsor": "Okusi Associates",
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