Government replaces PLN president

JAKARTA (JP): The government replaced Kuntoro Mangkusubroto as president of state electricity company PT PLN on Wednesday, to leave the burden of restructuring the ailing state company with PLN former marketing and distribution director, Eddie Widiono.

Ministerial decree no 108/2001 signed by Finance Minister Prijadi Praptosuhardjo on March 2, also re-appointed Hardiv Situmeang as PLN director for planning after he had resigned from the post in late 1999.

"Kuntoro is a tough person who has built a strong foundation for (Eddie) to carry on what must be done to restructure PLN," PLN chief commissioner Endro Utomo Notodisuryo said in his speech during the inauguration ceremony.

Kuntoro's dismissal came after he had served PLN for only about a year, since his appointment in January 2000.

Endro told reporters later that Kuntoro had done his job of restructuring PLN and that a regeneration was necessary to build on his work.

Endro denied suggestions that Kuntoro failed to show proper progress in talks with independent power producers (IPPs).

"Kuntoro's term was only a temporary one for PLN," he said.

However, he admitted that Kuntoro had left Eddie the formidable task of continuing the restructuring of PLN.

According to him, Eddie is the right person to lead PLN, as the government believes that his marketing background is vital in expanding PLN's business.

Eddie said that his priority was now in building up PLN from the inside to promote better teamwork.

"We want to be strong in the inside first when dealing with our problems," he said.

He refused to elaborate his immediate plans, but said that he would continue Kuntoro's overall policy.

Kuntoro himself described the reason for his replacement as "a refreshment", adding: "this is a happy day for me."

He said he would resume his teaching activities at Bandung Institute of Technology (ITB).

Kuntoro, former minister of energy and mineral resources, was appointed last year after his predecessor Adhi Satrya resigned in late 1999 in protest over the government's handling of the IPP issue.

The government signed 27 IPP contracts in the nineties, to cope with an anticipated surge in demand.

But the economic crisis in 1997 caused power demand to drop and crippled PLN's capability to pay for the IPPs' power.

Adhi and Hardiv tendered their resignations after President Abdurrahman Wahid ordered them to drop a lawsuit filed by PLN against IPP PT Paiton Energy with the Central Jakarta District Court.

PLN demanded its contract with Paiton be declared void, on the basis that it smacked of corrupt practices.

When Kuntoro took over PLN the company avoided seeking legal redress against the IPP. But thus far it has managed to secure a deal with only four IPPs.

Hardiv's reappointment at PLN now raises questions whether he would again lead talks with the IPPs.

Endro said that Hardiv was appointed because of his experience in handling the IPPs. But he could not tell whether Hardiv would indeed be included in the renegotiation with the IPPs.

"The man (Hardiv) is aggressive and we hope that we can use his aggressiveness should he be dealing with the IPPs, but under our terms," Endro said.

Hardiv said his past insistence on a legal approach against the IPPs, was based on reasons that he had felt were right.

He declined to state his view on the current talks with the IPPs, saying he needed more information on the latest progress.

Commenting on the IPPs, Eddie further said that he would not rule out a legal approach against the IPPs if such were necessary.

"Why should be leave out a legal approach, we will keep that option open," he said.(bkm)