Jakarta – The Institute for Essential Services Reform (IESR) said that the power wheeling scheme in the New and Renewable Energy Bill (EBET Bill) will accelerate the adoption of renewable energy in Indonesia, help achieve the renewable energy mix target, and support net zero emission (NZE) by 2060 or earlier.
IESR Executive Director Fabby Tumiwa emphasised that the power wheeling scheme is necessary given the structure of Indonesia’s electricity market, which is currently operated by a single company under government supervision.
“PLN as the holder of an integrated business area has the right to build and operate the transmission system, while other business actors do not have this right. Therefore, the electricity network should be accessible to other parties to distribute electricity from the power plant to users, which in turn provides revenue for PLN through network rental fees,” he said on Wednesday, July 10.
IESR also sees that the implementation of a power wheeling scheme for renewable energy will improve the reliability of electricity supply and operational cost efficiency. In addition, this scheme can encourage the expansion of the electricity grid, cooperation between business areas, and enable wider application of renewable energy technology to support the decarbonization of the industrial and transportation sectors.
“The implementation of the power wheeling scheme for renewable energy is also an efficient step to reduce the cost of developing transmission and distribution infrastructure, and reduce reliability costs by optimizing existing infrastructure rather than building new networks,” Fabby added.
He said Indonesia needs strict regulation of wheeling tariffs to ensure this scheme runs effectively. “The regulation on the calculation of wheeling tariffs must include components of system losses, reliability costs, ancillary services, and contingency costs, as well as the development of electricity transmission and distribution systems,” said Fabby.
Fabby also added that the government needs to develop clear guidelines on the method of calculating wheeling tariffs so as not to harm network owners and system operators. IESR encourages the DPR and the government to establish a power wheeling scheme in the EBET Bill and develop detailed and transparent implementation rules.
“With this scheme, it is hoped that renewable energy development can be optimized, support the advancement of sustainable industries in Indonesia, and meet customer needs for renewable energy,” said Fabby.
IESR is optimistic that the power wheeling scheme will bring many benefits, not only for renewable energy development but also for industries that strive to decarbonise and improve the reliability of electricity supply in Indonesia. (Hartatik)
