PLN Labor Unions Challenges Electricity Privatization
TEMPO.CO, Jakarta-Deden Adhityadharma, chairman of the Labor Unions of state power utility company PT PLN, said that he refused the electricity privatization plan as he was not sure if the move would improve PLN’s performance.
“Basic needs of the people must be controlled by the government. In this case, PLN is one of them,” Deden said at PLN head office in Jakarta on Thursday, February 11, 2016.
Therefore, PLN Labor Unions demanded PLN president director Sofyan Basir to improve the company’s performance based on the Shareholder’s General Meeting. Deden said that the basic production cost of electricity in East Indonesia had been high at Rp3,000 (US$0.2) per kWh.
“If electricity was to be produced by other companies than PLN, then there would be no cross-subsidies, which could be a disaster for local communities,” he said.
The Labor Unions also urged the PLN president director to reject the plan, which was initiated by the Energy and Mineral Resources Ministry and the Director General for Electricity, because it would weaken the PLN in managing electricity. They also asked the company to evaluate the state role in building power plants and setting the capacity.
The unions also stated their rejection of the plan that would split the company and cause electricity cost to be higher. They also pointed out that handing over electricity affairs to private company would violate Article 33 paragraph 2 of the 1945 constitution and weaken PLN’s role in power plant development in the next five years.
“If private companies were to be involved, then their participation must not exceed 20 percent of the operated capacity,” Deden said.
The final demand, the PLN Labor Unions rejected government plan to remove PLN’s role in six eastern provinces.
“PLN should not be disintegrated from Sabang to Merauke. Applying electricity price per region would cause electricity price to be unaffordable for people,” Deden added.