PLN agrees price cuts

PLN agrees price cuts

JAKARTA: PT Perusahaan Listrik Negara (PLN), Indonesia's state utility company, reached agreement on price cuts or buyouts with 26 independent power producers, Energy and Mineral Resources Minister Purnomo Yusgiantoro said.

"By reaching agreements with 26 producers, we are able to show the market that we can settle our dispute and that private producers can operate in this country," Purnomo told reporters after a cabinet meeting.

The utility has been trying to renegotiate power purchase agreements amounting to US$133 billion over 30 years with 27 independent producers, mostly backed by overseas investors, after the Indonesian rupiah's collapse during the Asian financial crisis in 1998 forced PLN to sell electricity to consumers at a loss. -- Bloomberg