Indonesia to inject $2.4b into PLN in 2020

The utility saw a decline in sales following the lockdown.

The Indonesian government is planning to provide $8.6b (IRD128t) for 12 state-owned companies, including a cash compensation of $2.4b (IRD35t) to state-owned electric utility PT Perusahaan Listrik Negara (PT PLN) in 2020. Its sales declined in the wake of the ongoing lockdown due to the coronavirus epidemic.

The bailout plan comes in addition to the capital injection programme made before the pandemic.

In April 2020, Indonesia introduced a US$6/MBtu cap on gas prices for power plants, which applies retroactively from 7 April, to PT PLN and to independent power producers (IPPs).

Since then, the difference between market prices and fixed prices has been covered by the Indonesian state. The cap on gas prices is expected to cut subsidies that the government pays to PT PLN, for which it has budgeted IDR54,800bn (US$3.8bn) in 2020.

This story was originally published by Enerdata.