On Electricity Tariff, Arifin: Government Policy Must be Accurate

MINISTRY OF ENERGY AND MINERAL RESOURCES REPUBLIC OF INDONESIA

PRESS RELEASE

NUMBER: 686.Pers/04/SJI/2019

Date: 29 November 2019

On Electricity Tariff, Arifin: Government Policy Must be Accurate

Minister of Energy and Mineral Resources (EMR) Arifin Tasrif emphasizes that any policies on Basic Electricity Tariff (TDL) in 2020 must be reviewed accurately so as not to inflict any loss on the public.

"We indeed need to extend the data (on subsidies). We need to conduct review, so (government) policies will be accurate," stated Arifin before members of Commission VII of House of Representatives in Jakarta, Wednesday (27/11).

According to the discussion results of the 2020 State Budget, the government and the House have agreed to grant on-target subsidies. For this reason, the subsidy for 900 VA group--the Comfortable, Middle-Class Households (RTM)--will be removed early next year. The electricity tariff for this customer group must be adjusted. As a result, electricity subsidy will drop, from the proposed Rp62.2 trillion to Rp54.7 trillion.

Related to this plan of TDL increase, the government is waiting for the proposal from the State Electricity Company. "There is a mechanism (for the increase in basic electricity tariffs); every three months, PLN submit proposal. We have not received any proposals, though. So, we haven't taken any steps to increase electricity tariffs," affirmed Arifin.

According to Arifin, if a rise is indeed to take place, the State Budget of 2020 is surely taken into consideration. The plan is therefore still at discussion level. "The price rise will be covered in the 2020 State Budget. We have to take into account current condition. There are a number of consideration we must make," Arifin explained.

The subsidized electricity tariff for 900 VA RTM group is Rp1,352 per kilo Watt hour (kWh) with 24,4 million customers, while the non-subsidized electricity tariffs (tariff adjustment) for 1,300 VA to 6,600 VA and above customer-groups are set at Rp1,467.28 per kWh. (IY)

Head of Bureau of Communication, Public Information Services, and Cooperation

Agung Pribadi (08112213555)