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Big businesses build their own power plants
Several large companies have developed their own power plants amid growing concerns over electricity shortages, particularly in Java and Bali, the countryâs major economic hubs
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everal large companies have developed their own power plants amid growing concerns over electricity shortages, particularly in Java and Bali, the country's major economic hubs.
Meanwhile, smaller companies have no choice but to close their businesses.
Indonesian Textile Association (API) chairman Ade Sudrajat said the group had sent warnings three years ago to notify affected parties of the looming electricity crisis.
He added that the notifications were a response to a reduction in the supply of electricity from state company PT Perusahaan Listrik Negara (PLN) to industrial consumers ' particularly in West Java ' from 380 volts to 340 volts.
'For us, electricity is a primary energy. When it's only 340 volts, it disrupts our electronic devices. It is like having a stage 4 cancer,' Ade said.
'Some companies, the big ones, have started developing their own power plants to create their own supply. But others have no option but to close [their businesses],' Ade said.
The PLN has raised concerns that a power crisis would hit as early as 2016, when the reserve margin in the Java-Bali system hit just 16 percent. The decline in supply has been driven by delays in the operations of several key power plants amid soaring area demand.
Among the projects put on hold include the development of a 2 x 1,000 megawatt (MW) coal-fired power plant in Batang, Central Java, a 1,000 MW Indramayu power plant in West Java and three mine-mouth power plants in South Sumatra that would deliver 3,000 MW to Java and Bali.
Though the government is preparing to break ground on a number of new projects, managing the loss of 6,000 MW supply from the delayed projects is no easy task.
Textile firm PT Sri Rejeki Isman, whose main production facilities are located in Sukoharjo, Central Java, said it currently used its own 8 MW power plant.
'The electricity generated from the power plant is used during the finishing stages of our production chain, such as the dyeing process. For now, supply from the PLN is still okay, but we are open to cooperating with other power suppliers,' said Sri Rejeki corporate secretary Welly Salam.
Jakarta-listed cement producer PT Semen Indonesia is developing a power plant to service a portion of its electricity needs. The company's corporate secretary, Agung Wiharto, said as much as 30 MW of electricity would be generated from the power plant, which would turn the heat generated in the company's factory compound into electrical power.
The 30 MW power plant, which is expected to be completed by the end of 2016, would slightly reduce Semen Indonesia's dependency on PLN. For its 4 existing factories in East Java, Semen Indonesia requires as much 150 MW from the PLN.
'Also, we are currently examining the possibility of developing coal-fired power plants. This is also aimed at cutting costs. Electricity now accounts for about 11 percent of our total costs,' Agung said.
Electricity demand in Java-Bali is estimated to be rising at 7 percent per year. The grid's peak load is currently stands at some 23,000 MW, while net capacity stands at some 31,000 MW.
Apart from concerns over the supply of power to existing industries, new demands from ongoing projects ' particularly the development of mineral smelters ' has also generated concerns.
