Tito Summa Siahaan – The government has proposed raising the electricity tariff incrementally every three months starting next year, undeterred after a similar plan ended abruptly this year in the face of widespread protests from the public, businesses and lawmakers.

"It is the state obligation to provide subsidies for those who need it," President Susilo Bambang Yudhoyono said during his annual budget address at the House of Representatives on Thursday.

"However, it is also within the state obligation to keep our financial condition sound and sustainable and to ensure that the subsidy only goes to those who actually need it."

The rising cost of electricity and fuel subsidies has been a primary concern during Yudhoyono's second term as president, impeding the country's infrastructure development and gobbling up government spending.

In the 2013 proposed state budget, electricity subsidies were set at Rp 80.9 trillion ($8.5 billion), a 24 percent rise from Rp 65 trillion this year. However, actual spending on electricity subsidies this year is projected to reach Rp 89.1 trillion.

Total energy subsidies are projected to cost Rp 274.7 trillion in the proposed state budget, up from Rp 202 trillion this year.

However, Energy and Mineral Resources Minister Jero Wacik said the government planned to raise the power tariff by 4 percent each quarter. "We will raise it in stages, so it will not create greater shocks," Jero said.

Finance Minister Agus Martowardojo said on Friday that the increases in the electricity tariff during 2013 would add up to around 10 percent. Yudhoyono also said raising the power tariff should come along with improved efficiency.

"To lower energy subsidy costs, especially for electricity, the government proposes to the House to adjust the electricity tariff automatically every three months starting in January 2013," he said.