Delinquent customers owe PLN Rp 1 trillion

The Jakarta Post, Jakarta

State-owned electricity firm PT PLN said on Thursday accumulated unpaid bills from customers had reached Rp 1 trillion (about US$117 million).

"There are 600 customers nationwide who have not paid their electricity bills, amounting to Rp 1 trillion. Some Rp 400 billion are from Jakarta," Sunggu Aritonang, PLN's commercial director told reporters as reported by Antara.

The huge amount of unpaid bills has further strained the company's cash flow, Sunggu added. The company is working to push customers into settling their unpaid bills fast.

He said most customers were middle-class homeowners and industrial customers.

PLN has around 30 million customers nationwide. Residential customers make up the bulk of the number (93.5 percent) and followed by business sector (3.9 percent). While industries make up 0.2 percent.

The company, Sunggu said, has sent warning letters to delinquent customers so they would pay their electricity bills on time.

PLN will also take legal action if customers fail to pay their bills after several warnings.

"We also warn them that we will cut electricity if they fail to pay. If they want to have their electricity back, they have to make a new application," Sunggu said.

According to Sunggu, there are some customers who has asked for leniency in paying the bills. They argued they could not pay the bills because they didn't have the money at present.

However, Sunggu said, PLN could not be too lenient because the company needed the money.

The company has been struggling to recover from its financial problems since the economic crisis in 1997. The company was dealt series of crushing blows as a result of the sharp drop in the rupiah against the U.S. dollar as operational costs and debts are in dollar terms.

Since 1998, the company has remained in the red. It only made a small profit of Rp 180 billion in 2001 before plunging into the red again in the next year and posting a net loss of Rp 6.06 trillion.

PLN previously said it would not be able to make profit this year following a decision by the government not to raise electricity prices. At present, power rates average at Rp 574 kilowatt per hour, or 6.79 U.S. cents. PLN is hoping for an increase to 7 U.S. cents in order to break even.