Benget Besalicto Tnb., Manado – Regions, which are vital in economic development amid the current regional autonomy regime, will continue to struggle to take the lead role without a breakthrough to solve the chronic problem of electricity, which has stood in the way of flows of investment.
"Without the availability of electricity, it's impossible for us in the provinces to invite investments we badly need to drive our local economy," North Sulawesi Governor Sinyo Harry Sarundajang told the press here over the weekend.
"I think electricity, beside the problem of land, is the main problem facing us. Many other provinces are also facing the same problem."
The governor was speaking to a group of journalists who visited three geothermal power plants which have a combined capacity of 65 megawatt (MW), including the US$30 million 20 MW Lahendong II plant which is financed by the Asian Development Bank (ADB).
"The electricity problem has worsened of late by the fact that PLN has to carry out rotating blackouts as it could not meet demand during the peak load," he said, adding that The ADB has agreed to finance the development of Lahendong IV geothermal power plant next year and was scheduled to be finalized by the year 2012.
The bank is also considering financing the development of Lahendong V and VI that will be started after 2012.
Currently, North Sulawesi province has 140 MW peak demand to serve about 300,000 customers. Its total installed generating capacity is 186 MW including those generated from the three geothermal plants.
But as many of its operating diesel-fired power plants are old, their actual power generating capacity only total 141 MW. With such a condition, there is almost no reserve capacity to meet the increasing demand which is recorded at about 8 percent per year.
The situation is in fact similar to many provinces in the country where blackouts become common, including in North Sulawesi, South Sulawesi, Southeast Sulawesi, Central Sulawesi, South and West Kalimantan, North Sumatra, Riau, Riau Islands, South Sumatra, Lampung, West Java, Banten, and Greater Jakarta.
Even in Riau Islands, PLN had to put out electricity for 12 hours a day, drawing a protests from the general public.
In North Sumatra a number of people had requested that PLN pay them compensation for its frequent outages had caused their electric equipment out of function.
Recently, a number of governors had met President Susilo Bambang Yudhoyono to discuss ways to settle the issue. But there has been no breakthrough taken to solve the chronic problem.
In Manado, Noldy Tuerah, CEO of Manado-Bitung Integrated Economic Development Zone in North Sulawesi province, told The Jakarta Post that due to the power outage businesses and industries in the province have seen their operational costs increased by more than 20 percent.
"Due to the frequent power outages, businesses and industries here have to use their own generators for several times a day. That is three times more expensive than the cost of having it from the PLN grid that cost Rp 1,380 per Kwh. As a result their operational costs have jumped by over 20 percent," he said.
"So how can the local government be able to attract the investments if there is no electricity for investors to operate their businesses? We also cannot expect the existing businesses to be able compete at the international market," he added.