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The Price of Power

Supply of Subsidized Electricity to Bali Hotels Questioned by Baliís PLN Chief

(12/25/2011) Bisnis Indonesia reports that hotels in Bali consume an estimated of 41% of the 587 megawatts of subsidized power provided for Bali by the State Power Board (PLN).

The General Manager of PLN-Bali, Dadan Koerniapoera, said: “Until this point, all hotels in Bali, both non-starred and starred properties, continue to consume subsidized electricity. All power supplied (to the island) is subsidized.”

Of Bali’s total power usage an estimated 55% is used by commercial enterprises. The estimated value of the commercial electrical power sector in Bali is put at Rp 350 billion (US$38.9 million).

Hotels are estimated to constitute 8% of all commercial power connections on the island. Because of the size of hotel installations, 41% of commercial connections are thought to go to hotel and accommodaiton providers.

Dadan views the use of subsidized power for the hotel sector as unjust given by what he sees as the high room rates charged by hotels and the fact that, at the same time, only 77% of all private residences in Bali enjoy an electrical power connection.

Acknowledging that PLN is unable to unilaterally raise tariffs, Dadan is urging the House of Representatives (DPR) to review policies on subsidized power to the hotel and business sector.