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Scrutiny
  
Power shortage
May have severe implications
15/05/2008

One of the fastest growing Asian giant, Indonesia is experiencing a crucial problem over the last few months. On the one hand, the economy is growing at 6.3% a year, on the other hand, the economic hubs of the country are experiencing power shortages and black-outs. The problem is not just about growing demand and need for additional powerhouses, but the present power station is also not utilised up to its capacity. Presently powerhouses are running at 75% of their capacity. Nevertheless, the government planning to built a 10000 MW power plant to meet the crisis.

With one nuclear power plant producing an average of 1,200 megawatts, Indonesia will need around four plants to bridge their immediate power gap. But it seems that the aftermath of 1997 crisis is still haunting the economy, as most of the plans are on paper. Moreover, this sector is not attracting many investors since the profit and returns are very low because of highly subsidised prices for the consumers. Studies show that if the government charges market prices of electricity (instead of subsidised prices), it could rope in around $650 million that can be further used to refurbish the present plants. In order to use the plants upto their utmost capability, it’s required to check the ageing and out-dated plants and then refurbish them.

By:- B&E
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