POWER RATE INCREASE TO CONTRIBUTE 0.36 PCT TO INFLATION

Jakarta, April 12 (ANTARA) - An increase by 15 percent in the basic power rate (TDL) will contribute 0.36 percent to inflation, Bank Indonesia (BI) Director for Economic Research and Monetary Affairs Perry Warjiyo said.

"If the power rate increase is proportionally applied, it could cause inflation to experience an additional increase of 0.36 percent from the target set before," the central bank director said here on Monday.

However, he said, if it was raised progressively its contribution to inflation could be smaller. This was because the wattage of electricity consumed by households was not evenly spread.

Perry said only five percent of state power utility company PLN's customers were in the 2,200 megawatt users' category while the remaining 95 percent were consumers of less than 2,200 megawatts.

Previously, Director General for Electricity and Energy Utilization J Purwono said the government was firm on its plan to raise the electricity basic rate in order to reduce subsidy in 2010.

"We are still waiting for the right time to raise it. But for sure it will be carried out this year," he said.

He said the government was planning to raise the power rates by an average of 15 percent for middle and upper scale customers.

But for small customers, the percentage of the increase had not yet been determined.

It was earlier reported the government planned to raise the TDL rate in January 2010 but President Susilo Bambang Yudhoyono had decided to postpone it.

As a consequence, the president asked the finance minster to cover the PLN cost with a subsidy, he said.