Govt promises not to increase electricity price till 2009

Jakarta (Antara News) - The government promised not to increase the price of electricity until 2009, an official said.

J Purwono, director general of electricity and energy utilization at the Ministry of Energy and Mineral Resources, said in a discussion forum attended by hundreds of young businessmen here Wednesday that the government would continue subsidizing electricity.

"But the government will reduce the price in stages," he said.

Based on calculation, he said, without price hike the electricity subsidy would no longer be necessary by 2012.

Purnomo also reaffirmed that the statement on power price hike 12 pct in 2007 issued when Minister Purnomo Yusgiantoro held a working session with the House of Representative`s Commission VII on Monday night (Sept 11), was not the government`s plan.

"It was merely an exercise and not a government`s plan. Therefore I apologize for this," he added.

During the session, Purwono said the gradual reduction in electricity subsidy in 2007-2010 with an increase of 12 pct and without raising the price of electricity in 2007.

But, media reported the presentation as the government`s plan of increasing the price of electricity in 2007. According to him, if there is no price hike, the electricity subsidy will stop in 2012.

The government has proposed the electricity subsidy for the 2007 state budget amounting to Rp25.8 trillion as a compensation for no increase in the price of electricity. (*)
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