Lampung prepares groundwork to invite investors

Oyos Saroso H.N. , The Jakarta Post , Bandarlampung | Sat, 11/28/2009 1:07 PM

The Lampung provincial administration is formulating regulations in response to anticipated consequences from the construction of the Sunda Strait bridge (JSS) after the central government took over the endeavor as a national project.

The regulations, in the form of local ordinances, will focus on investment and development in Lampung with a view to protecting the community from any negative impacts resulting from the bridge's presence or operation.

"Without regulations, money would rapidly flow out of the province because people in Lampung could easily go to Jakarta to shop and spend their money. Also, industries that are very lax or not concerned with environmental safety could invest or move their operations to Lampung if adequate regulations were not in place," Lampung Governor Sjachroedin Z.P. said.

Sjachroedin expressed hope the JSS, connecting the islands of Java and Sumatra, would be completed quickly.

"We don't want to be lose out to the bridge connecting Dumai in Riau with Malaysia," he said.

Sjachroedin said he was pleased by the central government's positive stance on the proposal - formed by the Lampung and Banten provincial administrations and governors from across Sumatra - to build the bridge.

"We are rather impatient because studies of a planned Java-Sumatra bridge have been conducted since the 1980s. Had the central government refused to assist, we *the Banten governor and governors from across Sumatra* would have built the JSS ourselves. We would have invited investors and managed it together with the Banten provincial administration," Sjachroedin said.

Prior to discussions at the national level, he added governors of eight provinces in Sumatra and the Banten governor had discussed the plan and the project's potentially huge benefits.

According to Sjachroedin, PT Artha Graha had conducted the project's feasibility studies.

"We invite the central government to conduct another study should they wish to do so," he said.

"The social disparity between Lampung and Banten provinces can certainly be reduced if the JSS project is realized," he added.

"The JSS, which is planned to have a height of 70 meters with a span of 30.4 meters, is designed to be able to withstand earthquakes and tsunamis. We are aware of the presence of the active Mount Anak Krakatau in the Sunda Strait which is prone to eruption and could trigger a tsunami," Sjachroedin said.

The JSS project has also highlighted possible impacts on the Archipelagic Sea Lanes of Indonesia (ALKI), which organizes marine navigation. The deepest sea gap included in the ALKI is located between Sangiang and Prajurit islands spanning 3.5 kilometers. According to the JSS plan, two of the bridge's support pillars will be built on each island.

The cost of the JSS project is estimated at Rp 92 trillion (US$9.79 billion), which will be divided into two phases. The first phase, costing Rp 1.8 trillion, would cover the feasibility studies and engineering costs, while the second phase would be the construction, costing Rp 90.2 trillion. The project has an estimated time to completion period of between six and 10 years.

At the end of October, Coordinating Economic Minister Hatta Radjasa said Indonesia would prioritize the development of domestic infrastructure, including the completion of the JSS.

Hatta added that the government would look to develop local economies through the JSS project. He said the recent focus on the JSS project was also aimed at preventing commodities in Sumatra from being sent to Malaysia and to create better connections between Java and Sumatra.

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Indonesia To Build World's Longest Bridge

PLN expects Rp 7.2t in net profits this year

Nani Afrida , The Jakarta Post, Jakarta | Sat, 11/28/2009 1:06 PM

PT PLN, currently exercising rotating blackouts in part of the country to manage electricity problems, is about to post hefty net profits this year.

Having long sunk in losses, PLN expects to return with a bang with full-year profits estimated to reach a handsome Rp 7.2 trillion (US$760 million), president director Fahmi Mochtar said Thursday.

The figure is a stark contrast to the Rp 12.3 trillion and Rp 6 trillion losses in 2008 and 2007 respectively.

Fahmi said as of June this year, the company had posted Rp 6.25 trillion in net profits.

Among the contributing factors was the government's decision to award the company a 5 percent margin in the distribution of electricity where the fare was subsidized by the state budget.

Fahmi said the margin was expected to increase operating profits to Rp 14 trillion by the year-end. By comparison, the company posted Rp 3.6 trillion in operating losses.

He said another factor was its efficiency programs such as converting fuel to natural gas to fire its power plants. Its steam-fired power plants were also working well without much weather disturbance unlike previous years.

According to Fahmi, between 2009 and 2015, PLN would need at least Rp 80 trillion per year for investment to meet rising power demand.

"Today, only 65 percent of Indonesia has electricity," he said. "We are trying to increase more power to areas lacking electricity access such as in regions of Papua and West Nusa Tenggara."

By 2014, PLN aims to boost electricity circulation to at least 80 percent of the country.

Since1998, Indonesia has experienced an electricity crisis because PLN's power capacity cannot meet the ever-increasing demand for electricity, causing power deficits and frequent blackouts across the country.

The condition is better in Jakarta than many other regions. However, the capital also experiences problems, such as the explosion of PLN's largest electricity substations, Cawang Baru, on Sept. 29, when fire razed two output transformers.

Fahmi said the Cawang Baru substation would be fully restored by Dec. 19 at the latest.

"The restoration is progressing well," he said. "Now there are no longer blackouts in Jakarta.

"By Dec. 29, Jakarta will have more electricity, although the supply is not enough *to meet the demand*."

Currently the government is working on the 10,000 megawatt electricity crash program to help speed up resolve electricity shortage in the country.

In 2009, PLN expects to produce 136,000 gigawatt-hours of electricity, 6.6 percent higher than the 127,600 gigawatt-hours produced in 2008.

Of the total production, 17.8 percent will be generated by oil-fired power plants, down from 23 percent last year.

Environmental damage in S Kalimantan alarming : minister

Antara News, Saturday, November 28, 2009 00:59 WIB | Environment

Banjarmasin (ANTARA News) - Environmental damage in South Kalimatan has reached an alarming level, Environment Minister Gusti Muhammad Hatta said here on Friday.

He said South Kalimantan, known as the "province of one thousand rivers", would some day be hit by big floods if the serious environmental problem was not addressed properly.

"Uncontrolled deforestation, air pollution, and water pollution over the past 15 years are major problems in the province," the environment minister said.

The minister said fires and illegal logging activities in the 2003-2007 period alone had destroyed more than 1.7 million hectares of forest in the province.

He said the extensive forest damage in the province had diminished the water flows in river basins and therefore floods and landslides frequently happened.

In 2007 alone floods hit the province 32 times and in 2008 and 2009 the number continued to increase because of silting up of rivers and illegal logging activities.

Such a condition, according to environment minister, was worsened by the malfunctioning of rivers as a result of domestic and industrial activities.

To overcome the problems, the local government would launch clean-water and blue-sky programs, in addition to the construction of waste water management systems, and rehabilitation of degraded forests.

Governor Fauzi not all that keen on fixing busted roads

Niken Prathivi, The Jakarta Post, Jakarta | Wed, 11/25/2009 2:13 PM

The old adage puts safety first, but Jakarta Governor Fauzi Bowo seems to think it can wait, as in the case of damaged roads.

The rainy season has traditionally been a time when motorists, and in particular motorcyclists, are warned to drive more carefully to avoid rainwater-deluged potholes.

But on Tuesday, Fauzi said his administration would not rush to repair them, adding it could wait until the advent of the dry season.

"We'll repair the damaged roads; we have the money for it," he said.

"However, we won't do it right away."

He said his administration had made its own assessments of the road conditions as well as traffic load for each road.

Fauzi also said should the administration insist on repairing the damaged roads during the rainy season, the work would be in vain.

Heavy rains coupled with increased loading only serve to hasten the damage, the governor pointed out.

However, Indonesian Consumer Protection Foundation (YLKI) director Tulus Abadi disagreed.

"The administration can be penalized *if it fails to promptly repair damaged roads*," he said as quoted by beritajakarta.com.

Tulus cited Article 273 of the 2009 Traffic Law, which stipulates five-year prison sentences or Rp 120 million fines for the responsible officials or institutions who fail to repair damaged roads.

Voicing similar concern, city councillor Nurmansjah Lubis said Jakarta residents could sue the administration over the poor roads.

"Filing a lawsuit is an important move as the damaged roads can lead to fatal accidents, especially to motorcyclists," Nurmansjah said.

Data from the Jakarta Police's Traffic Management Center shows 20 people were killed in traffic accidents in the first three months of this year.

The TMC also notes at least 17 areas with damaged roads, including at the Jl. H. Nawi intersection near ITC Fatmawati, at the Senayan shooting range intersection in Central Jakarta, and on Jl. Simpruk Raya in West Jakarta.

Institute of Transportation Studies (Instran) director Darmaningtyas attributed the damaged roads to poor construction coupled with bad planning.

"The roads are easily damaged because they were poorly built," he pointed out.

"For instance, on a scale of one to 100 - where 100 means ideal materials mixing, asphalting and funding, what we have here is less than 50.

"*The contractors* often scale down the initial construction plan. So it's obvious why the results are far from satisfactory," Darmaningtyas added.

He said poor timing in carrying out the road repairs also played a part in the quality of the roads.

"Water is the main element in the asphalt," he said.

"But what we have here are constructors who mostly carry out the repairs during the rainy season."

The best time for road repairs in Jakarta is from May to October, during the dry season, he added.

To support a successful road renovation, Darmaningtyas said, the responsible agencies (including the public works agency) must reform its construction management.

Agency head Budi Widiantoro previously said the city had allocated a Rp 40 million budget for road maintenance for the first half of 2009, and another Rp 37 million for the second half.

"With this budget, we plan to revamp all the damaged roads this year," he said.

"However, if that's not possible, we'll continue the repairs based on the 2010 budget."

PLN Buys from Private Companies to Deal with Crisis

Tempo Interactive, Tuesday, 24 November, 2009 | 18:17 WIB

TEMPO Interactive, Jakarta:In order to deal with electricity shortage in some parts of Indonesia, state-owned electricity company, PLN, is signing a contract with a number of companies that have excess power. PLN Operations Director for Java-Madura-Bali, Murtaqi Syamsuddin, explained that the company has discussed the plan with nine companies in North Sumatera, Riau, Jambi, Lampung, West Java and East Java that have their own electricity generators.

“They are producers of palm oil, paper, gas and textiles,” Murtaqi said yesterday.

At a meeting last Friday, Murtaqi said, the owners of these companies agreed to supply 86 megawatt of electricity to PLN. This comprises 12 MW for North Sumatra, 16 MW for Riau, 4 MW for Bintan, 10 MW for East Java, 17 MW for South Kalimantan, 20 MW for West JAva, 6 MW for Lampung, and 11 MW for Jambi.

Earlier, PLN signed a contract to buy 106 MW of electricity from PT Inalum, and a 47 MW supply from PT Growth Plantation in North Sumatra as well as a 61 MW from PT Bekasi Power and PT Argopantes in West Java. “The electricity power is now already in PLN’s system,” Murtaqi said.

SORTA TOBING

Govt to impose guidelines on airport development

The Jakarta Post, Jakarta | Tue, 11/24/2009 9:47 PM

The Transportation Ministry will soon issue an “airport principle” containing guidelines for government agencies including regional administrations as well as airport operator companies in planning, constructing, and operating airports across Indonesia.

The ministry’s director of airports Bambang Tjahjono said that they aimed to impose the principle in January 2010, to follow up the newly-endorsed Law No. 1/2009 on Aviation that allowed private companies and regional administrations to build and operate airports.

“This guideline will give exact measures about airport development planning as well as criteria for local administrations that plan to construct a new airport in their territories,” Bambang told The Jakarta Post.

He criticized regional administrations that sometimes proposed to build new airports to the ministry without supporting comprehensive studies about the future plan of the airport.

“Sometimes regional leaders, governors and regents, are too ambitious to build airports but lack market study. As a result, new airports become deserted or even abandoned,” Bambang said.

He cited the failing Samarinda Baru airport in Samarinda, East Kalimantan, the unclear West Java International airport plan in Majalengka, West Java, and the deserted Notohadinegoro airport in Jember, East Java, as examples.

Data from the ministry recorded 196 airports nationwide, excluding those owned by private parties and military that were not used for public flights, Bambang said.

“The minister has recently approved the plans to develop 31 new airports.”

Of the new airports, only the West Java International Airports in Majalengka is planned to be a big airport.

The rest are small airports, mostly in eastern Indonesia, such as Aceh Singkil in Nanggroe Aceh Darussalam, Enggano in Bengkulu, Banyuwangi in East Java, Wakatobi in Southeast Sulawesi, Tual Baru in Maluku, Nabire Baru in Papua, and Halamahera Tengah in North Maluku.

“Most of those small airports will be funded by local budgets. The central government is only approving their proposals,” Tjahjono said. (bbs)

City announces plans for flood early warning system

Indah Setiawati , The Jakarta Post , Jakarta | Mon, 11/23/2009 10:14 PM

The Jakarta administration will develop an early warning system for areas around the Pesanggrahan River in South Jakarta, to mitigate possible flooding in this rainy season.

Since the Situ Gintung dam burst earlier this year, the areas have become more prone to flooding, because the dam that once retained flood water from the river is no longer in place.

Deputy Governor Prijanto said the system would station several workers in the former dam area who could make quick calls to heads of nearby residential areas whenever water levels exceeded acceptable limits.

“We will build a good early warning system. If the dam shows sign of flooding, people around Pesanggrahan river have to know about it,” Prijanto said Monday at City Hall.

However, the Jakarta Administration could not do anything related to the rehabilitation of the infrastructure of the Situ Gintung dam, which burst on March 27 during the rainy season, Prijanto said.

Besides making the early warning system, he said he would order the mayors of South and West Jakarta to provide temporary shelters for residents whose houses may be affected by future floods.

The administration also plans to station dinghies and emergency response teams in areas near the river, to minimize the time it takes aid to reach flood areas, Prijanto said.

The head of Environmental Task Force NGO, Ahmad Safrudin, said the move was too late since the Situ Gintung catastrophe had happened eight months ago.

“The city should have developed an early warning system straight after the dam burst, not at the beginning of this rainy season.

“But it’s better late than never,” he added.

House approves Rp 300 b for W. Sumatera reconstruction fund

The Jakarta Post, Jakarta | Sun, 11/22/2009 7:26 PM

The House of Representatives has approved the release of a Rp 300 billion (US$ 30 million) relief fund to assist reconstruction and rehabilitation in areas destroyed by a powerful earthquake in West Sumatra in September.

The funds are part of Rp 1. 2 trillion taken from this years budget agreed on by the House and the government.

Bakri Beck, Deputy for Rehabilitation and Reconstruction at the National Disaster Mitigation Agency (BNPB), said on Sunday the House had agreed to allow the government to allocate the money.

“We can use the money as soon as we sign a memorandum of understanding with the related parties,” Bakri told Antara state news agency.

He added his office would hand over the fund to residents so as they might rebuild or repair houses damaged by the earthquake.

“To smoothen the transfer of the funds, we will ask for residents to form groups consisting of between 20 and 25 people,” he said.

He added his office would transfer the fund to bank accounts each group had opened.

Data from the provincial Natural Disaster Mitigation Board (Satkorlak) has revealed 37,587 houses were destroyed by the quake. (ewd)

Govt remains committed to developing border areas: minister

Antara News, Sunday, November 22, 2009 19:45 WIB

Pontianak, W Kalimantan (ANTARA News) - State Minister for Disadvantaged Regions A Helmy Faisal Zaini said the government remained committed to developing border areas into the country`s verandah.

"In 2009 alone, the government disbursed Rp40 billion to finance the development of infrastructure projects in five districts in West Kalimantan province," he said after a dialog with local officials and figures here on Sunday.

The five districts are Sambas, Bengkayang, Sanggau, Sintang and Kapuas Hulu.

The minister said to speed up the development of border areas, the government will also encourage private companies to invest in the regions.

He proposed that the heads of the five districts form a caucus so that they can well coordinate their efforts to speed up the development of border areas.

To make border areas more progressive, the development of disadvantaged regions will focus on strengthening local administrations, boosting local economies, empowering local people, and intensifying the development of infrastructure facilities such as roads, he said.

Earlier, after paying a working visit to Aruk close to the Indonesia-Malaysia border, the minister also launched an integrated village development program as part of effort to promote backward villages.

The program is aimed at boosting rural economy by building supporting facilities, such as rural markets, information stalls and agribusiness, he said.

The program is related to a change in the development paradigm of disadvantaged regions from area-based to village-based, he said.

The change in the paradigm is expected to speed up efforts to promote up to 50 backward districts per year, he said.

To support the program, he said his office has been coordinating with the Public Works Ministry, the Health Ministry, the National Education Ministry and the Finance Ministry, he said.

He said the government has decided to set aside 2 percent of the total general allocation funds for the development of the regions.

No More Rolling Blackouts in Jakarta, Says PLN

The Jakarta Globe

PLN employees working on the infrastructure at the utility's Cawang plant on Friday. (Photo: Antara)

State-owned electricity company PLN said on Friday that it had ended rolling power blackouts in and around Jakarta.

PLN's manager of distribution for Jakarta and Tangerang, W Budi Nugroho, said the rotating power cuts could now be averted because certain large consumers had cut back on their energy use.

"Thanks to their participation to save up to 150-200 megawatts, PLN has not imposed rolling power outages since Thursday," he said.

The participating companies included PT Bogasari and PT Astra, he added.

Problems at PLN power stations in Kembangan, West Jakarta and Cawang, East Jakarta left Greater Jakarta about 800 megawatts short of its usual power supply in recent weeks. The energy shortage has led to hugely unpopular blackouts throughout the area.

The utility said on Thursday that its Muara Karang gas-fired plant would go offline for maintenance between Christmas and New Year’s Eve, however, causing possible power shortages during the holiday period.

Antara, JG

Indosat extends sea cable system to Singapore

Antara News, Tuesday, November 17, 2009 21:17 WIB

PT Indosat. (ANTARA/Ardika)Jakarta (ANTARA News) - Telecommunication operator PT Indosat Tbk will spread the sea cable communication system or SKKL to connect Jakarta, Pontianak, Batam and Singapore which will be used for the internet-based protocol (IP) or non IP services.

PT Indosat president director Harry Sasongko after inaugurating two new telecommunication backbones here Tuesday, said that the marine cable system is 1,300 km long.

"With this additional marine cable systems, Indosat will have additional bandwidth capacity at the early stage of 80 Gbps which will be used for both IP-based services (Internet Protocol) and the non-IP," he said.

The SKKL installed by Indosat in cooperation with NEC has a four landing points on the islands of Tanjung Pakis (Karawang, West Java), Sungai Kakap (Pontianak, West Kalimantan), Tanjung Bemban (Batam), and Changi (Singapore).

"The fiber-optic network will be able to anticipate the possibility of the very large demand until the Gbps (Giga bits per second)," he said.

In addition, the network is expected to serve as a redundant or back up for the existing international network.

"All cable systems FO or fiber optic Indosat has used ring system or redundant, so if there is a break in the cable, it will be immediately backed up by another network," he said.

Meanwhile, the Indonesian ambassador to Singapore, Ali Wardana said, at least 158 thousand Indonesian people live in Singapore so that the existence of the SKKL has a potential to increase relations between the two countries.

PLN Boss Prepared To Fall on His Sword

The Jakarta Globe, Reva Sasistiya

Jakarta's recent blackouts have left PLN's residential customers fuming while business owners struggle to keep their doors open. (Photo: Safir Makki, JG)

Fahmi Mochtar, the beleaguered president director of state utility PT Perusahaan Listrik Negara, on Thursday said he may not be in his job next month as widespread blackouts continue to plague Greater Jakarta, with more frequent blackouts expected during the Christmas-to-New Year period.

“I may not be being interviewed by you [reporters] next month,” a visibly tired Fahmi said at a press conference late on Thursday. “As the head of the company, who has a duty to the people, I am ready to be replaced at any time.”

Fahmi made the comments after a marathon nine-and-a-half hour meeting with Coordinating Minister for the Economy Hatta Rajasa, along with the ministers for state-owned enterprises and energy.

State-Owned Enterprises Minister Mustafa Abubakar declined to comment on Fahmi’s future as he was leaving the meeting. But he had warned last week that he would sanction top officials at PLN if the utility failed to meet a December deadline to end the rolling blackouts.

Fahmi has been under serious pressure for more than two weeks. On Tuesday, a visibly angry President Susilo Bambang Yudhoyono warned him that if PLN could not end the power shortages, it could lose its monopoly to supply power to the country.

Meanwhile, on Thursday the early December target of ending the bulk of the blackouts seemed less likely. PLN revealed that its Muara Karang gas-fired plant would be offline between Christmas and New Year’s Eve because state energy company PT Pertamina would shut off its gas supply.

PLN said it had asked Pertamina to shut off the supply from Dec. 24 to Dec. 31 so it could perform maintenance work originally scheduled for November.

Bambang Praptono, PLN’s director of planning and technology, admitted that this would mean more frequent power cuts during the holiday period.

PLN to fine contractors delaying projects

Antara News, Thursday, November 19, 2009 17:24 WIB

Jakarta (ANTARA News) - State-owned electricity company PLN will fine contractors delaying the completion of their projects under the 10,000 megawatt (MW) power plant projects, a PLN director said.

PLN`s director for strategic construction affairs Agung Nugroho said here on Thursday that the fine would be imposed on contractors who could not show acceptable reasons of the delay.

"The fine has been stipulated in the contracts," he said.

He said that the fine amounts up to five percent of the total contract value, which comes to one per mill per day.

In the meantime, contractors could also lodge a complaint if PLN delayed payments.

PLN estimated that only about 915 MW of the projected 1,890 MW under the 10,000 MW mega project crash program would be completed at the end of this year.

Jakarta Heading for Watery Grave, Experts Warn

The Jakarta Globe, Ulma Haryanto

Floods are an annual event in many parts of Jakarta. (JG Photo/ Afriadi Hikmal)

At least a quarter of Jakarta would be underwater by 2050 if current rates of development projects and groundwater harvesting continued unabated, a climate expert warned on Wednesday.

Armi Susandi, a climatologist from the Bandung Institute of Technology (ITB), said the northern part of Jakarta would most likely be permanently submerged by 2015.

“I am talking about Cilincing, Muara Baru and Tanjung Priok”, he told the Jakarta Globe on Wednesday.

“Meanwhile the Soekarno-Hatta International Airport [located in Tangerang, Banten] will be underwater by 2030.”

In a 2009 ITB study on land subsidence and urban development in Jakarta, Indonesian and Japanese researchers showed that an increase in population and urban development activities in the capital was driving the subsidence because of the sharp increase in built-up areas and decrease in natural green spaces.

The problem has been exacerbated by factories, hotels and wealthy residents drilling their own deep-water bores to bypass the city’s water grid, sucking out the groundwater and causing further subsidence. Jakarta’s limited pipe network for clean water means that about 40 percent of residents have to pump their own groundwater.

The soft ground that makes up most parts of Jakarta, the weight of ever-expanding road infrastructure and buildings and the excessive exploitation of groundwater all play a part in the city’s subsidence.

In 2005, Armi, together with ITB oceanographer Safwan Hadi, created a simulation that suggested that by 2050 a quarter of Jakarta would be submerged by the sea.

“Sudirman and Kuningan areas will still be there by 2030,” he said, in an apparent reference to media reports on Wednesday that half of the city, including Sudirman in Central Jakarta and Kuningan in South Jakarta, would be inundated by seawater by 2030.

Armi explained that his simulation had used a spatial and periodical projection of the depreciation of the ground level in Jakarta versus the rising sea level. The simulation utilized what he called a “digital evaluation model,” which he applied to the Greater Jakarta area to project the impact if nothing was done between 2005 to 2050, using 5-year intervals.

According to his simulation, Merdeka Square and its surrounding areas in Central Jakarta would be under water by 2080. “So Sudirman and Kuningan should also be underwater in about that year,” Armi said.

The parameters used for his simulation were an average rise in sea levels of 0.57 centimeters per year, and a ground level subsidence rate of 0.8 centimeters per year. “So the average sinking rate will be 1.37 centimeters a year,” he continued.

However, the World Bank in 2008 said that Jakarta was sinking by as much as 4 to 10 centimeters annually.

Armi argued that the projection he made was according to actual sea and coastline conditions, and with the use of global positioning to measure the rate of sinking in Jakarta.

Despite his less-catastrophic prediction, Armi still called on the government to solve the problem. “Jakarta has to adapt permanently by building sea walls along the coastlines of North Jakarta. The walls should be built by 2015,” he said.

The wave breakers currently being built in North Jakarta, he said, would only help to prevent tidal surges during extreme weather conditions.

“What we need are sea walls,” he said, adding that the walls should be at least two to three meters above sea level and six meters thick to be able to protect the city from the ocean, which he predicted could rise by one meter by 2100. Ulma Haryanto

Indonesian President Gives Ultimatum to PLN’s Top Boss

The Jakarta Globe, Yessar Rosendar & April Aswadi

A worker checking an insulated gas line at the PLN power station in East Jakarta. The utility company has failed to provide adequate power supply to service areas since September. (Photo: Safir Makki, JG)

Avisibly angry President Susilo Bambang Yudhoyono on Tuesday warned state utility PT Perusahaan Listrik Negara that if it could not end the nation’s power shortages — especially in Jakarta — then other independent companies may be given the chance to do so.

“PLN seems to have a limited capability on this issue, and it would be wrong if PLN wanted to handle [the nation’s power needs all alone]. Other companies should be given the opportunity through the correct regulations and policies,” Yudhoyono said after a limited cabinet meeting held with PLN directors on Tuesday.

He did not elaborate.

PLN currently enjoys a monopoly on generating and selling power in the country, although a recent regulation allowed independent power producers to sell power directly to producers in areas where there is currently no power supply.

After the meeting, Yudhoyono told reporters he had asked PLN president director Fahmi Mochtar whether PLN was capable of producing enough power to meet the country’s needs.

He said he also demanded that Fahmi explain whether PLN was capable of handling the current power-shortage crisis, and whether it had any backup plans in case its existing policies didn’t work. He did not describe Fahmi’s replies.

The meeting was also attended by Coordinating Minister for the Economy Hatta Rajasa, Energy and Mineral Resources Minister Darwin Saleh, State Minister for State Enterprise Mustafa Abubakar, State Secretary Sudi Silalahi and Jakarta Governor Fauzi Bowo.

Yudhoyono also said PLN needed to demonstrate good governance as a large business with trillions of rupiah in revenue.

“There should be no wrongdoing. If there is wrongdoing then the people will suffer,” he added, without elaborating.

Fahmi was questioned as a witness by the Corruption Eradication Commission (KPK) on Thursday over the procurement of an information technology system when he served as PLN’s director for the Jakarta area from 2003 to 2005. Fahmi approved the Rp 241.5 billion ($25.7 million) purchase without a tender process.

Yudhoyono emphasized that generating enough power to meet the country’s needs would be a priority of the government for the next five years. He asked for effective planning and coordination between PLN and relevant parties.

The president urged a coordinated effort among government ministries and departments to find the funding necessary to finance the production of enough power to meet demand.

Meanwhile, Yudhoyono said he planned to instruct all government agencies and state-owned firms to conserve more energy.

“We did it a few years back and it had a significant result,” Sudi said after the meeting. “The savings could cut up to 70 percent of electricity usage in all government bodies.”

Hatta said the government needed Rp 30 trillion to overcome the national electricity shortage, with Rp 5.6 trillion to solve the electricity problems in Jakarta alone. “We have calculated the required funds needed to overcome the shortage of electricity and later we will coordinate the sources of the funding from PLN, the state budget and regional government funds,” Hatta said.

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PLN no longer able to solve power problem alone