Jakarta. The State Owned Electricity Company (PLN) has to hold the plan to acquire the Geothermal Power Plant Darajat and the Geothermal Power Plant, which are the assets of Chevron Geothermal due to the objection from government over PLN involvements in the bidding processes to acquire the two geothermal power plants, which have a total capacity of 632 megawatt (MW).
The Spokesman of Ministry of Energy and Mineral Resources Sujatmiko said that the Minister of Energy and Mineral Resources Ignasius Jonan has objection to the plan. Sujatmiko added that the Minister even questioned the involvements of PLN in the bidding processes.
Sujatmiko revealed that the Ministry of Energy and Mineral Resources wants to focus on the completion of the project of 35,000MW electricity rather than to expand to the operating projects. Let alone, PLN needs a huge number of funds to purchase the two assets minimum at above of US$ 600 million.
Furthermore, PLN should focus on the establishment of electricity transmissions. “Pak Jonan said, lest the power plants are ready, but the power plants, which become parts of PLN responsibilities, are not ready yet”, Sujatmiko told KONTAN on Sunday (30/10).
Until the news was revealed, KONTA has not yet received confirmation from PLN about the warning from Ministry of Energy and Mineral Resources. Previously, the Spokesman of PLN I Made Suprateka revealed that PLN and Chevron have discussed about the sales of the two geothermal power plants due to the termination of the contract on electricity trade in 2020. “PLN has no obligation on extending the contract”, he said in the last week.
Therefore, if other parties purchase the assets of Chevron, PLN is not necessarily willing to purchase the electricity anymore. “If we don’t purchase the geothermal productions, it will be redundant, it is worthless”, he said.
Energy observer Fahmi Radhi estimated that a State Owned Enterprise is eligible to involve in bidding process related to asset purchasing. “As long as the government is impartial”, he said.
Executive Chairman of the Association of Indonesian Private Electricity Entrepreneurs Arthur Simatupang said that a State Owned Enterprise is actually eligible to control strategic assets of electricity. However, the involvements of PLN in the bidding processes over Chevron’s assets may drive conflict of interest, since PLN has control over electricity contract and trade.
On the other hand, the acquisitions give no value added to the supplies of national electricity, as the Chevron’s geothermal power plants are no longer operating. Let alone, the interest of PLN to the geothermal productions of Chevron merely related to the target to meet quota for renewable energy supplies to 23% of total electricity production by 2025.
(MUHAMMAD FARID/Translator)
