Kedutaan Besar Republik Indonesia
Ottawa
Embassy of the Republic of Indonesia
Ambassade de la RÉpublique d'Indonésie

Electricity and Gas Main Focus for Ministry in 2015

The Energy and Mineral Resources Ministry will allocate more funds this year to the construction of gas distribution networks and electricity transmission infrastructure in several areas.

The programs are expected to boost domestic gas absorption, which is still low.

The additional budget allocation is part of the proposed revision to the state budget to be discussed with lawmakers.

Under the planned revision, the ministry will receive an additional Rp 5 trillion (US$393 million) and make its total budget Rp 15 trillion, according to Energy and Mineral Resources Minister Sudirman Said.

“The allocation is bigger and we hope the absorption [of the budget] will also be 10 times that of last year,” Sudirman said.

He added that the additional budget would be used to speed up energy diversification programs, partly by supporting the development of gas infrastructure, to support the construction of transmission networks by state-owned electricity firm PT Perusahaan Listrik Negara (PLN), to prepare and deliver 2 million canisters of 3-kilogram liquefied petroleum gas (LPG) to areas still using kerosene, to supply 50,000 converter kits for fishermen to convert from diesel fuel into LPG, and to support the program of electricity procurement for the country’s 48 outer spots.

The ministry’s director general for electricity, Jarman, said as much as Rp 5.04 trillion of the total budget would be directed to electricity programs.

“We will have an additional budget of electricity procurement for villages. However, the amount for the construction of transmission networks and the main stations will remain the same,” Jarman said.

He pointed out that the additional allocation for electricity procurement for villages would increase by Rp 1.3 trillion, pushing up the total planned allocation to Rp 3.86 trillion from the previous Rp 2.56 trillion.

Meanwhile, the allocation of transmission networks and main station development would remain at Rp 1.17 trillion.

Apart from electricity for villages, transmission networks and main station development, the move to give light to 48 outer areas in the country will cost Rp 1 trillion.

Electricity is one focus of the ministry as the government under President Joko “Jokowi” Widodo has set an ambitious target of reaching an additional electricity capacity of 35,000 megawatts (MW) in five years.

The total target means that the country will need to add around 7,000 MW per year, an enormous figure compared to the current realization of electricity projects per year of only around 2,000 MW.

For its long-term strategy, the country is aiming for an electrification ratio of 99 percent by 2020.

The ratio was around 82 percent as of the end of last year, with a total installed capacity of 51,981 MW.

The country is also concerned about a potential power crisis in Java following the delay of several projects. There are also nine areas outside Java that have power deficits.

The PLN previously said it would allocate Rp 50 trillion in investment to support power projects this year.

Source : www.thejakartapost.com, Monday 12 January 2015