Electrifying our remote villages: A challenge

Hanan Nugroho ,  Jakarta   |  Mon, 06/29/2009 12:34 PM  |  Opinion

The number of Indonesian's living in rural villages outnumbers the number of urbanites in this nation of 17,000 plus islands.

It is believed that access to electricity - even just enough for lighting - would drive rural economic activity, reduce the birth rate and enable these villagers to pursue education.

A more significant amount and higher quality of electrical services could then be introduced to allow for TVs, telephones and the Internet to penetrate remote areas.

In spite of geographical obstacles and financial barriers, rural electrification (RE) has been a key priority of the government of Indonesia since the First Five Year Development Plan in the early 1970s.

From 1994 to 1998, the government launched a program to boost RE, setting a target of providing power to 15,000 villages. State electricity company PT PLN was assigned the task of implementing the program; aside from some small scale systems, such as micro hydro and solar home systems (SHS). The ambitious 50 megawatt SHS program (to provide 1 million rural households with 50 watts of electricity each) was also introduced during this period.

Unfortunately, the 1997 economic crisis forced substantial changes to the RE program, and only 10 percent of the "50MW SHS" target has been achieved. In the reformation era (since 1999) the number of parties involves in the RE program, regional and local governments in particular, has increased.

Even within the central government, various ministries, such as the Marine and Fisheries Ministry and the Ministry of Health, have developed programs linked to rural electrification in areas far away from their headquarters.

Estimates suggest that 60-70 percent of our households currently have access to electricity, and that 85 percent of villages have some access to electricity. On a regional basis, the electrification ratio varies from about 20 percent in very isolated areas to 100 percent in Java's major cities.

Even though we are making progress towards supplying rural villages with electricity, our electrification ratio remains lower than that of most Southeast Asian countries, including Thailand (99 percent) and Malaysia (98 percent). More than 10,000 rural villages are still waiting for electricity.

The current Long Term Development Plan (2005-2025) has set the bold target of electrifying 100 percent of Indonesian households by 2025, and achieving a 100 percent rural electrification ratio by 2015. However, the challenge of electrifying rural villages becomes increasingly difficult the more remote they get. Isolated villages with no roads - not to mention meeting the needs those Indonesian communities that live nomadic lives - demands a much greater effort and raises costs significantly. What should we do then?

A larger amount of PSO (public service obligation) funds, managed by the government, need to be allocated to PT PLN if the RE targets are to be met. However, it is necessary that the use of the funds by this major player is monitored effectively. Auditing, and perhaps even a separate accounting system to ensure the funds are used solely to finance the RE program, is essential.

Regional and local governments have shown major interests in RE activities, they are even ready to prepare their local energy planning, as mandated by the Law on Energy 30/2007. It would be better for the Jakarta-based central government then, to gradually reduce their involvement in the RE program an instead channel funds to local governments.

What our many previous experiences have taught us is that, along with commensurate responsibilities and accountability, an effective way to ensure the sustainability of the RE program is to allow rural communities to have a larger stake in the process. This approach should be expanded.

As the targets become more difficult to reach, providing incentives to private businesses actively involved in RE is also important. Involving women in the community-based RE activities, including in the operation and maintenance of the system, is necessary not only to promote gender equality, but in anticipation of the fact that men are usually the ones who leave villages as to become urban economic migrants.

"Electricity for All"; having access to electricity is basic right for all people. The government should electrify the rests of Indonesia's rural villages - the sooner, the better.

The writer is an energy planner and economist with the National Development Planning Agency (Bappenas). The opinions expressed are his own.

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