A 10% raise of electricity tariff (TDL) is being planned by the Indonesian government for the coming 2012. In addition with respect to TDL adjustment that has not been applied since 2004, the new policy will also aim to reduce the load of energy subsidization. “With this scheme, the subsidy is projected to reduce to Rp. 20,7 billion.” Says Finance Minister, Agus Martowardojo.

Electricity subsidization for 2012 during state budget draft meeting is projected at Rp. 44.9 billion, while in 2011 the amount reached Rp. 65.6 billion. According to Finance Minister, the plan to raise TDL next year will be imposed proportionally and on target. “There are tariff policies of course, the raise won’t be imposed on poor families who use electricity below 450 volt ampere,” says Agus, adding that the plan will not affect the 2012 inflation which has been assumed at 5.3% in 2012.

The economist of Sustainable Development Indonesia, Dradjad H. Wibowo says the rise of TDL is unavoidable due to increased production cost and the demand for power extensification. However, it is more acceptable by public if the government and State Power Company (PLN) put more effort in production cost efficiency by replacing power source from solar to coal or gas.