- The Ministry of Energy and Mineral Resources (“Ministry”) has now opened up the opportunity for the private sector to establish electrical power plants and/or transmission networks in a push to minimize economic inequality in Indonesia's frontier, outermost and lesser developed regions (daerah terdepan, terluar, dan tertinggal3T). Director for the Energy Sector for the Committee for the Acceleration of Priority Infrastructure Delivery at the Coordinating Ministry for Economic Affairs, Mr. Triharyo Soesilo, added in a recently issued statement that a number of investors have the capabilities required to engage in the electrification of Indonesia's more remote areas.
- In terms of the more remote regions of eastern Indonesia in particular, electricity procurement projects should encourage cooperation between Village Enterprises (Badan Usaha Milik Desa/BUMDes) through the use of their budget allocations and power producers operating within the private sector.
- The amount of investment in electrical infrastructure required in order to attain an electrification ratio of 100% across Indonesia was recently calculated at IDR 10.7 trillion. As of 2020, the required amount of investment now stands at IDR 11 trillion, however, Indonesia’s State Electricity Company (PLN) is only capable of providing a total of IDR 2.1 trillion to such projects. Private sector investment will thus be crucial to any attempts to extend Indonesia’s electrical infrastructure. (JPP)
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