Electricity Rates Raised As Of 1 September 2014

Jakarta – TAMBANG. The government has again raised the electricity tariff as of 1 September 2014, as part of the government’s policy to increase the electricity tariff base gradually since last May-July.

Director General for Electricity of the ESDM Ministry, Jarman, estimated that the electricity tariff increase will save around Rp17,36 trillion in subsidy. In addition, by increasing periodically until November 2014, eight groups of electricity customers will no longer be receiving subsidy.

Bambang Dwiyanto,Senior Manager Corporate Communications of PT. PLN, has earlier called for more frugal and wise use of electricity. He acknowledged that every time the electricity rate is increased, power consumption will go down due to the saving by the public. "However the decrease will not be too big. We expect that it can really go down to sustain consumption growth," he explained.

The increase of the electricity tariff will consist of two stages. First it will be imposed on the open middle class industry (l3) with an 8.6% increase every two months, and second on the large industry (I4) with a 13.3% increase every two months.

Earlier, both groups have experienced an increase in May. The September increase will be the third after the second stage in July. The increase will be done periodically every two months until November, while for the I3 non-open industry (tbk) the gradual increase is of 11.5%.

The electricity subsidy for the year 2014 is set at Rp94.26 trillion.With the increase for the six classes of electricity from 1 July to 1 November 2014, electricity subsidy can further be reduced as much as Rp8.51 trillion to Rp85.75 trillion.

Author: Nova Farida ([email protected]) Translation: Jim Maulana Ichsan ([email protected])