JAKARTA (TheInsiderStories) – The energy and mineral resources (EMR) minister, Arifin Tasrif, has signed the second amendment of ministerial regulation Number 50 of 2017 concerning Utilization of Renewable Energy Sources for Electricity Supply. The government also plans to regulate the electricity price for renewable energy-based power plants through a presidential decree.
According to director at the ministry, Harris, in a written statement released on Tuesday (03/10), the tariff regulation its expecting will be issued in the first quarter of 2020. He adds, the new scheme proposed is the feed-in tariff, based on the production cost of renewable energy.
Currently, renewable price is made based on its regional generation basic cost determined by the state-owned power producer, PT Perusahaan Listrik Negara (PLN). However, the scheme was deemed ineffective as it cranks the electricity tariff.
With excluding the old scheme, the country hope could attract investors to invest more in the development of renewable energy-generated power plants. Recently, the investment in these sector far from the government’ targets.
The official explained, at least there are five main changes in the second amendment, like the purchase process, arrangements for hydropower or irrigation projects built by the government, assignment of waste power plant producer, projects whose funding comes from grants or government, also build, own, operate, transfer (BOOT) scheme.
In detail, Harris mentioned, the government open the purchasing process through direct appointment, from which initially the option through auction with certain conditions, including emergency provision of local electricity, excess power, additional generation capacity, only one prospective provider, and the hydropower plant has a location permit from the regional government.
Second, BOOT scheme no longer applies for power plants that utilize renewable energy sources as stated in article 27B. For developers who have signed the purchasing power agreements, the pattern of cooperation can be adjusted to the pattern of cooperation built, own and operate, by taking into account the provisions of the applicable laws and regulations, he continued.
Third, the new decree adds a new article regarding the purchase of electricity from hydropower plants that utilize reservoirs, dams, or multipurpose irrigation channels built by the public works and public house ministry. Based on article 7A the government could direct appointment and assignments for the ministry.
Fourth, the rules regarding the purchase of the waste power generation are affirmed in article 10 paragraph 3, which states that the purchase of electricity from the producer is carried out based on the assignment of the minister to PLN to purchase power from the developer that has been determined by the regional government in accordance with statutory provisions.
Finally, Harris mentioned that the renewable energy project whose funding came from grants or government other than the State Budget was carried out by direct appointment through assignments regulated in article 18B.
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