PLN Financials: The JETP Scenario in development of RE and its supporting infrastructure is very ambitious. How do you think this ambition can be realized, considering PLN's limited financial capacity?
One of the policy recommendations offered was to reinstate the MEMR Regulation on tariff adjustment for non-subsidized tariff. If non-subsidized consumer tariffs are slightly adjusted (for inflation, for example) each year, this can significantly decrease the compensation that would be required.
Another policy recommendation to help PLN manage its cash flow is through a reform of domestic coal price cap, which if revoked, PLN would be compensated through a mechanism that will be funded by a windfall tax from the coal supplier. The JETP Secretariat also recommends a revenue model reform for PLN that would allow PLN to recoup its investment in new renewable energy projects and together with the other policy recommendations is expected to ensure that PLN is financially sustainable while also maintaining GoI fiscal health. At the same time, it is important for PLN to develop a diversified and appropriate financing plan consistent with its overall corporate strategy.
