PLN firm on Cikarang Listrindo decision
JAKARTA (JP): State electricity company PLN president Djiteng Marsudi said yesterday he would not review his recent decision to annul the company's power purchase contract with PT Cikarang Listrindo, an independent power producer.
Djiteng told The Jakarta Post that this was despite a request from Cikarang Listrindo.
"I shall not review the decision," he said.
PLN stopped buying power from the Cikarang, which is partly owned by former president Soeharto's cousin Sudwikatmono, starting Monday although the contract, signed in 1993, was supposed to be effective for 20 years.
Cikarang Listrindo, which runs a 150 Megawatt (MW) gas-fired power plant in Bekasi, West Java, started operation in 1993 with the exclusive right to supply power for industrial plants in Bekasi.
PLN signed a contract to buy the excess power generated by Cikarang in the same year, but Djiteng claimed PLN had signed the contract under duress.
"I am ready to face a lawsuit as a result of this move," Djiteng said earlier this month.
His move has reportedly made foreign investors, who control most of the country's independent power producers, worried over the future of their projects.
Two ministers, including State Minister of the Empowerment of State Enterprises Tanri Abeng and Minister of Mines and Energy Kuntoro Mangkusubroto, who both supervise PLN, have publicly opposed Djiteng's decision.
"A contract is a contract," Kuntoro said recently. "I don't want to hear any official in my ministry annul a contract with an excuse that he was under duress to sign the contract in the past."
Tanri said Djiteng's decision was not correct and the arbitrary act could give a negative image of Indonesia.
He warned state firms should not arbitrarily annul contracts with third parties without consulting the government.
"All contracts which need to be reviewed must be identified and submitted to the government," Tanri said.
Tanri has set up a task force, consisting of PLN's directors and officials from the General Directorate of Electricity and Development and the State Ministry of the Empowerment of State Enterprises, to work out a comprehensive solution to PLN's problem. (jsk)