Observer Of The Value Of The Government's Decision To Adjust Electricity Rates Is Right

Energy Watch Executive Director Mamit Setiawan. (Photo: ANTARA)

JAKARTA - Energy Watch Executive Director Mamit Setiawan assesses that the government's decision to adjust electricity rates for non-subsidized household customers of the R2 group above 3,500 VA is correct.

"In my opinion, it is appropriate because the variable for forming the basic price of electricity tariffs has increased. Moreover, the last tariff adjustment was carried out in 2017. So there has been no adjustment for a long time," said Mamit when contacted by VOI, Monday, June 13.

He said that currently the price of crude oil greatly affects the Indonesia Crude Price (ICP), while ICP is one of the variables in determining the cost of production of electricity tariffs.

"ICP is already very high, inflation is also rising, the rupiah exchange rate has weakened, causing the cost of electricity supply (BPP) to increase. Otherwise this will put pressure on state finances and also PLN," he added.

He added that through adjustments to R3 and R4 customers and the government, it could save up to IDR 3 trillion in costs due to reduced compensation paid to people who can afford it.

In addition, for the community there is also no impact because customers of 3500 VA and above are only 2.5 percent of the total PLN customers as a whole.

"Moreover, they are from the upper middle class, so this increase will not have too much impact on their finances. It should also be borne in mind, thus in the future if the price formation variable decreases, the government should lower the tariff after an evaluation is carried out every 3 months," concluded Mamit. .

Previously, the government through the Ministry of Energy and Mineral Resources decided to adjust electricity prices starting July 1.

This adjustment only applies to non-subsidized household customers of R2 (3,500-5,500 VA), R3 (6,600 VA and above), P1 (6,600 VA to 200kVA), P2 (200 kVA and above), and P3.

The Director General of Electricity at the Ministry of Energy and Mineral Resources, Rida Mulyana, said that government assistance was provided for all classes of customer tariffs in the form of subsidies and compensation.

This decision is contained in the Letter of the Minister of Energy and Mineral Resources No. T-162/TL.04/MEM.L/2022 dated 2 June 2022 concerning Adjustment of Electricity Tariffs (July–September 2022 Period).

The government's decision to adjust the electricity tariff for customers of 3,500 VA and above was due to the increase in the magnitude of the four macroeconomic indicators.

"Tariff adjustments are not illegal to do because they have been carried out since 2014 based on tension," Rida said at a press conference in Jakarta, Monday, June 13.

Rida said, in order to maintain people's purchasing power, competitiveness of the industrial and business sectors, control inflation, and strengthen national economic stability, the tariff adjustment was only applied to well-to-do households which amounted to 2.09 million customers or 2.5 percent of the total PLN subscribers. reached 83.1 million.