Indonesian steel giant pays extra for stable electricity

Indonesian steel producer Krakatau Posco has signed a deal with state utility Perusahaan Listrik Negara to pay a premium in exchange for improved service levels.

The steel company is concerned about inadequate and unreliable power supply.

The deal with the joint venture between Indonesia’s Krakatau Steel and South Korea’s Posco will valid for 10 years, according to the PLN.

Under the deal, PLN will charge steel producer Krakatau Posco a premium rate of Rp 810 (9 cents) per kilowatt hour, which is higher than for ordinary customers, who pay Rp 604 per kwh.

PLN’s planning and risk management director, Murtaqi Syamsuddin, and Posco’s president director, Kim Dong Him, signed the deal at PLN headquarters in Jakarta, the utility company said in the statement.

Many major corporations and manufacturers operating in the country are seeking ways to ensure a reliable power supply and avoid power shortages, which are common here.

“This is a special price to guarantee power supply,” PLN said in the statement.

Several other Indonesian companies have already signed similar deals with PLN.

For the source of this story, click here.

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