Japanese Firms to Meet PLN over Blackouts

JAKARTA ~ Japanese firms announced this week that they would meet officials from state power firm PLN over a power crisis in Indonesia they say has lost foreign investors millions of dollars.

The Jakarta Japan Club was to meet PLN on Friday over chronic outages and a plan for two weeks of rolling blackouts in the capital Jakarta, club secretary general Hiroyuki Amaya said.

Japanese companies are furious over six months of major blackouts on the densely populated islands of Java and Bali, which they say have cost them Rp41 billion (US$4.51 million) in losses.

The roughly 1,000 Japanese companies in Indonesia are major investors in everything from heavy industry to retail but Amaya said they were being hit by power outages without prior notification in 60 percent of cases.

“Sudden halts in production generate many defective products and damage production facilities, largely in chemical, tire manufacturing and precision parts factories,” he said.

Businesses in Jakarta are bracing for millions of dollars in losses when the rolling blackouts kick in on Friday, switching off patches of the capital for eight hours a day.

The cuts are officially due to maintenance work that will interrupt gas supplies to two state-owned generating stations in North Jakarta, but analysts have blamed the country’s crumbling infrastructure.

Rising demand for electricity has led to increasing numbers of blackouts across Indonesia in the past few years despite the archipelago’s vast resources of oil, natural gas, coal and geothermal energy.

The power crisis appears to be deteriorating even though only 53 percent of the archipelago’s 220 million people has access to electricity.

The government is planning to boost capacity by some 30 percent to about 40,000 megawatts by 2011, but the first new power station is not expected to be operational until mid-2009.

Central bank Governor Boediono told reporters on Wednesday that the “electricity crisis” was symptomatic of infrastructure restraints that were the biggest obstacle to growth in the country.

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