By implementing the tariff adjustment, the government can save Rp8.85 trillion in subsidy over a period of one year, Mineral Resources and Energy Minister Jero Wacik said.
Jakarta (ANTARA News) - The Government plans to raise the electricity tariff, ranging between 38.9 and 64.7 percent, for large-scale industries from May 1, 2014.

The Mineral Resources and Energy Minister Jero Wacik stated that the tariff adjustment will be implemented in stages over a period of two to four months.

"The implementation of the tariff adjustment at the two-month period will have its economic impact by the end of 2014. However, if we implemented the adjustment once in every four months, the effect will be felt by the middle of next year," Jero claimed.

The minister added that the government will implement the tariff adjustment on May 1 after the legislative elections in April.

"The Government and House of Representatives should try to maintain conducive environment during the election period," stated Jero.

The minister emphasized that by implementing the tariff adjustment, the government can save Rp8.85 trillion in subsidy over a period of one year.

Jero noted that the government will implement the adjustment on 371 companies that belong to the I3 industry type, which are listed in the stock market.

The I3 industry type is applicable for companies with use more than 200 kVA of electricity.

Jero remarked that the adjustment will also be implemented on 61 companies that belong to the I4 industry type, which use more than 30 thousand kVA of electricity.

The government plans to raise the electricity tariff for the I3 industry type at 38.9 percent, which will be divided at 8.6 percent and implemented in either two- or four- month period.

Jero also noted that the tariff adjustment for the I4 industry type will be set at 64.7 percent, which will be divided into 13.3 percent and implemented in either two- or four- month period.

According to the minister, the government has also proposed the tariff adjustment in its automatic billing system for four consumer types, who will not enjoy any subsidy, effective May 1, 2014.

There are four types of non-subsidy consumers such as the large household (R3) user at above 6,600 VA, middle business (B2) type with 6,600 VA to 200 kVA, large business (B3) above 200kVA, and government middle building (P1) with 6.600 VA to 200 kVA.

The tariff model will be based on the inflation, oil price, and the dollar exchange rate.

"The government will be able to save Rp1.42 trillion in a year by adjusting the subsidy on electricity tariff," Jero stated.

The Government and Budgeting Agency in the House of Representative has agreed to raise the electricity tariff for I3 and I4 type companies and the implementation of the automatic system for the four types of non-subsidy consumers.(*)

Editor: Heru Purwanto
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