JAKARTA: The government estimates that the cancellation of electricity tariff hike this year will add IDR5 trillion to the subsidy to IDR98.1 trillion.
The government cancels the plan to raise electricity tariff as of April 1 to take out more burden to the people, said Deputy Minister of Energy and Natural Resources Widjajono Partowidagdo. Consequently, the electricity subsidy in 2012 Revised State Budget will swell.
“If oil price rises to US$105 per barrel from US$90 per barrel, subsidy for electricity will increase. Moreover, if the electricity tariff is not raised, there will be more IDR5 trillion for subsidy,” he said after a coordination meeting at Ministry of Economy on Thursday.
It has been proposed that electricity subsidy will rise to IDR93.02 trillion in the Financial Note and 2012 Revised State Budget, compared to the earlier ceiling at IDR44.96 trillion. The proposal is based on the electricity tariff hike by 10% as of April.
Minister of Energy and Natural Resources Jero Wacik said that the government and legislators have agreed to delay raising electricity tariff gradually this year.
“Until our future notice. If the situation eases and economy grows , we will discuse the tariff once more,” the Minister said Thursday on the sidelines of a meeting with House’s Commission VII.
At the same time, the government has committed to raising the price of subsidized fuel.
Though the policy is not an easy option, it is needed to support economy growth for the people, to make healthier State Budget, the Minister added. (T04/NOM)
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