Firms to change operating hours or face power cuts

Novia D. Rulistia ,  The Jakarta Post ,  Jakarta   |  Wed, 07/09/2008 10:48 AM  |  Headlines

New operating hours for manufacturers will come into force in October, after the government finalized a draft of the relevant joint ministerial decree on Tuesday.

Businesses that violate the new schedule for operating hours will suffer temporary power cuts, whereas those that comply will receive incentives, the Industry Ministry secretary-general Agus Tjahjana said.

"If companies fail to obey the rule, they will first be warned. But if they continue to disobey it, they will have their electricity cut temporarily," Agus said.

"The timing of the electricity cut will depend on PLN. The details of the punishments will be recorded separately from the joint decree."

He said the finalized draft would be brought to the ministerial level before being implemented in October this year.

The joint decree involves five ministries: the Industry Ministry, the Energy and Mineral Resources Ministry, the Manpower and Transmigration Ministry, the Home Ministry and the State Ministry for State Enterprises.

The regulation will apply to the factory and office operations of all manufacturers, except those that must operate 24 hours a day, and requires businesses to move two of their working days to Saturday and Sunday.

Moving businesses' working days to the weekend is necessary because there are about 1,000 megawatts of idle power capacity on Saturday and Sunday, the government said.

As well as imposing punishments, the regulation will also include incentives for companies that shift their operating hours.

"The incentives will be decided between PLN and the manufacturers. They will be calculated from the total amount of electricity savings," Agus said.

He said the shift in operating hours will help PLN conduct efficiency measures.

"It's like a discount, but the percentage will be settled between them," he said.

According to Industry Minister Fahmi Idris, the decree says each company will decide its own operating hours and will report their changes to industry agencies in their respective regions.

The decree will be evaluated every six months and will be extended to apply until Dec. 31, 2009.

The Indonesian Chamber of Commerce and Industry (Kadin) vice chairman for industry and technology affairs, Rahmat Gobel, said the decree was needed to find the best solution for industry.

"Kadin understands the situation and there's no other choice. We have to take this as a national decision so the power crisis will no longer hurt investment and labor," he said.

Some industry associations said the decree would lower their productivity because they needed to recalculate their daily production and would harm workers relying on overtime payments.

According to Industry Ministry data, industry and households are the biggest consumers of electricity, at around 38 percent each, followed by businesses such as hotels, malls and offices at 20 percent.

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