Sofyan Djalil: PLN to Blame if Government Misses 35 GW Power Project

The Minister of National Development Planning/Head of the National Development Planning Agency(Bappenas) Sofyan Djalil has said that the government will not revise its target for construction of the 35 gigawatt power plant project because the program is included in the National Medium Term Development Plan to 2019.

Sofyan said that his agency had prepared the plan for the mega project, while the Ministry of Energy and Mineral Resources provided regulatory support for the project through regulations. "We're not going to revise (the target). If the project fails to materialise, the issue will be at the technical level within PLN," Djalil said at his office in Jakarta on Monday (16/5). (See also: Government to Fund 9 Infrastructure Projects Worth IDR 33 T from Chinese Loans).

He added that, as a planning agency, Bappenas had played its role, which is to source funding if necessary. However, there were some instances where financing was not an issue but realisation and implementation of the project had been delayed. "Such as in the case of high voltage direct current (HVDC) project or Sumatra-Java transmission," he said.

Sofyan is confident that land acquisition will no longer hamper infrastructure development in the future because the government has set up a public service agency for land acquisition called the State Assets Management Agency (LMAN). The agency is expected to make land acquisition easier so that the government can take control of strategic areas with high commercial value. Its second round effect is that there will be revenue to fund land acquisition.

He pointed out several commercial projects such as the provision of land for rest a reason the toll roads, industrial areas, warehouses in port areas, and for aeropolis on airport land. "We can’t continue like this, where the private sector has two million hectares of land while the government has none," said Sofyan. (Read: PLN to Build Thousands of Transmissions and Substations to Support 35 GW Project).

Meanwhile, Director General of Electricity Jarman asked PLN to immediately finalise and submit the draft Power Supply Business Plan (RUPTL) to 2024 this week. the government asked the state electricity company to submit the draft to the ministry some time ago, but PLN has yet to hand over the document.“No later than 20 May. This is the final deadline," Jarman said (Read: Four Factors Delaying Completion of the 35 GW Mega Power Project)

The insistence of the Ministry of Energy to PLN is not unfounded. Last Friday, Minister of Energy and Mineral Resources Sudirman Said was summoned by President Joko Widodo to ask him about the progress of the 35 GW electricity project because many investors and business players had enquired about this.

Energy Ministry data show that the construction of the 35 GW power plant project has been delayed. As of last month, only 0.6 percent of the 35 GW power plants were in operation. The rest are still in the planning, procurement, and construction phases.

Previously, PLN’s CEO Sofyan Basir claimed that the implementation of the 35 GW project has been hampered by social and legal issues. Specifically, he claimed that there were four factors affecting the project: land acquisition, licensing, litigation, and cooperation with third parties.

Land acquisition is a major problem for the 35 GW electricity project. According to PLN, there are 210 issues affecting the project. These include 145 land acquisition issues, 44 permit issues, nine lawsuits, and three issues related to cooperation with third parties.