INDONESIA AS NEW EMERGING MARKET

Thursday, March 23, 2006

ELECTRICITY INFRASTRUCTURE PROJECT

Indonesia is now facing a serious crisis in power supply as shown by frequent blackouts in various regions outside Java-Bali Island lately. The crisis is feared to get worse in the future. To solve the problem PLN (state-owned electricity company) have to build some electricity infrastructure that worth US$139.5 billion.

PLN has planned to install 13,405 km total of transmission networks to be completed in the coming year 2005-2015, which will be installed 5,586 km in Java-Bali, and 7,820 km in other islands.

With the additional transmission networks, new sub-stations with total capacity of 28,254 MVA will be needed including 24,026 MVA in Java-Bali and 4,198 MVA in other island. An addition 121,154 km of medium voltage cables and distribution transformers with capacity of 40,326 MVA will also be needed to improve the distribution systems.

Because of The government limited financial capability, they have liberalized the electricity sector and launched privatization of sector. It has invited foreign and domestic investors to take part in the development of the sector. The invitation was extended by President Susilo Bambang Yudhoyono when addressing the Infrastructure Summit held in Jakarta.

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