By
Vietnam News Agency
Sat. 6 July 2024 | 15:00 GMT+7
The Indonesian government will include electricity transmission in its renewable energy bill, allowing private companies to sell electricity directly to consumers through a transmission network owned by state-owned power company PLN.
One effort to develop new renewable energy is to use solar panels in Pertamina’s operating areas, as seen at the Cilacap refinery in Central Java. Photo courtesy of Pertamina.
Energy and Mineral Resources Ministry Director General Eniya Listiani Dewi said on Thursday that the ministry was formulating the pricing rules and conditions for using PLN transmission to distribute renewable electricity.
The government removed the power wheeling clauses from the bill in November 2022, but then revived the bill the following year.
Current regulations require that electricity produced by independent power producers (IPPs) be sold to PLN for distribution under a state monopoly, including provisions that limit the economic feasibility of clean energy projects.
Businesses have demanded that the provision be included in the bill, but some ministries in President Joko Widodo’s administration still refuse to accept it.
The Ministry of Finance believes that this mechanism could lead to fluctuations in electricity prices due to market effects, which would make consumers unable to pay. Others fear that PLN could suffer losses when electricity supply exceeds demand.
According to Energy and Minerals Minister Arifin Tasrif, it will be difficult for Indonesia to achieve its renewable electricity targets if it relies on only one supplier – PLN, he said, noting that opening up the industry will encourage independent power producers to produce renewable energy, which can help accelerate the adoption of clean energy in Indonesia.
