Price set for Grati power plant

Price set for Grati power plant

JAKARTA (JP): The government has approved the price of electricity from a private gas-fueled power project at Grati in Pasuruan, East Java. The price per kilowatt hour (kWh) will be 5.88 U.S. cents, an official announced here yesterday.

The Private Electricity Director of the Ministry of Mines and Energy, Moeljadi Oetji, said the price is based on the assumption that the cost of natural gas from the state-owned oil company Pertamina will be $2.84 per million British Thermal Units.

He told The Jakarta Post that the US$1 billion power project, which will have a generation capacity of 500 megawatts, will soon be under construction by a consortium made up of Enron of the United States and PT Jawa Energy Power, a company controlled by tycoon Ibrahim Risjad.

The government now allows private investors to establish power plants in Indonesia on the condition that they sell their electricity to the state electricity company PLN, which will then sell it to the public.

The electricity price for the Grati project will be far lower than the price levels set for two other power projects currently being built by private investors.

Two coal-fired power stations are being built at Paiton in East Java, at a cost of $2.1 billion, by a consortium made up of Siemens AG of Germany and the Bimantara Group of Indonesia. They will have a combined capacity of 1,200 megawatts and the price of electricity generated by them will be 6.09 cents per kWh.

Another consortium, made up of the Dutch subsidiary of Mission Energy of the United States, Mitsui Co. Ltd. of Japan, General Electric Co. of the United States and PT Batu Hitam Perkasa of Indonesia, will sell its electricity to PLN for 8.56 cents per kWH for the first six years. For the six-year period after that, the price will be 8.41 cents and for the remaining 18 years of the contract the price will be 5.54 cents.

The new power stations are expected to start operating in 1998. (04)