Looks like GMC power/electricity costs are going to get a lot worse.
“Inflationary pressures have largely arisen from administered price hikes such as electricity tariff hikes,” said Weiwen Ng, an economist at Australia & New Zealand Banking Group Ltd. in Singapore. Higher power costs “are a necessary evil” and structural reform that the economy needs, he said.
The government raised electricity tariffs twice this year, and delayed a third hike initially planned for June because it would have coincided with Ramadhan, the Muslim fasting month when food prices generally spike. Inflation, which reached a 14-month high of 4.3 percent last month, could have broken through 5 percent if power costs were raised a third time, said ANZ’s Ng.
The government has decided to maintain electricity prices at their current level until the end of 2017 in a bid to boost the country’s industrial competitiveness – a move that will force state electricity firm PLN to undertake various internal efficiency measures to keep its financial performance healthy.
“The President has stated that electricity will serve as the foundation to boost Indonesia’s economic competitiveness,” Energy and Mineral Resources Minister Ignasius Jonan told reporters in Jakarta on Wednesday.
“If electricity prices are more affordable, our industries will be more efficient.”
According to the ministry, since January, non-subsidized consumers of high-voltage electricity have paid Rp 1,467.28 per kilowatt hour (kWh), while mid-voltage and low-voltage consumers have paid Rp 1,114.7 per kWh and Rp 996.74 per kWh, respectively.
WOW, "non-subsidized consumers of high-voltage electricity have paid Rp 1,467.28 per kilowatt hour (kWh)"
Thats more than US$0.11/KWh. More than 3 x the cost of OM Holdings ferro alloy plant in Sarawak Malaysia. Maybe GMC should run a big extension power cable across the water to Sarawak.
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