PLN may seek approval to raise rates

PLN may seek approval to raise rates

PT Perusahaan Listrik Negara (PLN), Indonesia's state-owned
power utility, may consider asking the government to increase
electricity prices next year to help the company cope with
soaring fuel prices.

An increase in crude oil price by 10 percent boosts the
utility's fuel costs by Rp 1.5 trillion (US$162.6 million), PLN
president director Eddie Widiono said. The company had planned to
spend about Rp 15 trillion this year to buy oil to fuel its power
plants, based on the assumption that crude oil prices are at $22
a barrel, he said.

"Right now we're trying to use more gas or coal to minimize
the impact on rising oil prices," Eddie told reporters in
Jakarta. "We're still calculating to see whether we need to ask
the government to increase electricity rates."

Crude oil futures in New York have gained 77 percent in the
past year as economic growth in China and the U.S. spurred
demand. It rose to a record $50.47 a barrel in New York earlier
today.

PLN had a loss of Rp 3.56 trillion, or Rp 77,176 a share, in
2003, compared with a loss of Rp 6.06 trillion, or Rp 131,423, a
year earlier, the utility said in June. -- Bloomberg