PLN under fire for cooperation
PLN under fire for cooperation
JAKARTA (JP): The state electricity company PT PLN was under
fire yesterday over its dealing with private investors involving
power generation, which has caused high prices of electricity for
subscribers and PLN.
A member of the Commission VI of the House of Representatives,
Iskandar Mandji, said in a hearing with PLN executives that PLN
is also not transparent in setting criteria for companies which
may be awarded contracts for the establishment of power
generating plants.
He said PLN's decision to allow private producers of
electricity to set electricity rates at levels higher than those
set by PLN will affect electricity subscribers.
PLN has allowed PT Cikarang Listrindo to set billing rates at
levels higher than PLN's rates for its customers during peak
hours at industrial estates in Bekasi, West Java.
PLN also agreed to buy electricity from PT Paiton Energy
Company, a private consortium which is now constructing a 1,230-
megawatt (MW) coal-fired power plant in Paiton, East Java, at Rp
183 (8.3 U.S. cents) per kilowatt hour (kWh), much higher than
PLN's average generation cost of Rp 114.18 in Java.
Mandji also said the House of Representatives had received
complaints from private companies over the absence of clear
criteria on which bidders can be awarded contracts with PLN.
In response to the criticisms, PLN's president Djiteng Marsudi
said that contract decisions and the pricing of electricity are
both under the authority of the government.
He acknowledged, however, that the pricing was set on the
basis of brief studies made by PLN and its contractors.
He hopes the government will provide criteria for companies
bidding for contracts with PLN in the coming years.
Bonds
Djiteng also said PLN has scaled down its plan of offering
bonds to the public from the original value of Rp 1 trillion to
only Rp 500 billion due to weak demand from investors.
PLN's director of finance, Muslim Abuhudjus, told reporters
during a break at yesterday's hearing that according to the
underwriter of the bond issuance, PT Danareksa Sekuritas -- the
state-owned investment trust company -- demand for PLN's bonds
had reached only around Rp 275 billion.
PLN said last week that the company had for the second time
delayed its plan to offer five-year bonds worth Rp 1 trillion on
the over-the-counter (parallel) market.
Muslim said PLN will probably offer the bonds on March 26
through April 6 on the parallel bourse.
PLN will use funds from the bond issuance to finance various
power projects in the country. (fhp)