Govt to regulate companies' operating hours

Desy Nurhayati ,  The Jakarta Post ,  Jakarta   |  Fri, 07/04/2008 11:07 AM  |  Headlines

Beleaguered by rising oil prices and stalling electricity supply projects, the government is planning to issue a decree regulating company operating hours in a bid to reduce electricity consumption.

Speaking after a meeting with the Vice President on Thursday, Industry Minister Fahmi Idris said the government would issue a joint ministerial decree this month to regulate company operating hours.

Under the regulation, Fahmi said, companies, particularly those in the manufacturing industry, must schedule their operating hours to help ease periods of peak load endured by state electricity firm PT PLN, or face sanctions.

"The electricity loads usually decline on weekends and escalate in the week. Therefore, we will ask the manufacturers to reschedule their hours of operation," Fahmi told reporters at the palace.

The regulation will apply to all manufacturers -- including their factory and office activities -- except those forced to operate 24 hours a day, including petrochemical companies, he said.

The arrangement will not hurt companies' productivity, he said, adding that the decree would be formed in cooperation with business associations, particularly the Indonesian Chamber of Commerce and Industry.

The government will also restrict the use of fluorescent lamps nationwide, including in households, he said. "Fluorescent lamps will only be sold overseas."

The energy saving measures are expected to save up to 3,500 megawatts (MW) per year, or equivalent to Rp 6 trillion (US$650,000).

"If we are able to save up to 600 MW, there will be no blackouts," Fahmi said.

The government will also conduct an evaluation on electricity usage in state offices starting this month with the aim of cutting usage by 20 percent.

"The Vice President has ordered that sanctions be imposed on those failing to cut electricity usage. We will discuss the sanction later and include it in the decree. We will also hire inspectors to control electricity usage," Fahmi said.

Head of the government's energy-saving team Eddhie Widiono said the application of the energy saving measures should be brought forward to prevent further electricity crises amid limited energy stocks and rising demand.

"With the increasing demand, even the largest generators, such as the Tanjung Jati B generator with a capacity of 660 MW, might be disrupted. Therefore, we should produce more reserve capacity," he said.

Blackouts hit Jakarta and parts of Java last week when the 600-MW Cilacap power station in Central java ceased operations due to a coal supply shortage.

In February, PLN imposed a series of scheduled blackouts on Java because of sub-optimal performance by four power plants, which lead to a supply deficit of 1,000 MW.

PLN initiated a project in 2007 to construct 35 new coal-fired power plants with a total capacity of 10,000 MW. The project is expected to be completed by 2010.

The revised 2008 state budget, which assumes the Indonesian Crude Price (ICP) to be $95 per barrel, estimates the electricity subsidy could reach Rp 60.9 trillion by the end of the year. As of Wednesday, the ICP was already more than $132 per barrel.

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