Jakarta, CNBC Indonesia – Commission VII of the Indonesian House of Representatives (DPR) is targeting the Draft Law on New Energy and Renewable Energy (RUU EBET) to be completed before the administration of Indonesian President Joko Widodo (Jokowi) is completed.
This was stated by Deputy Chairman of Commission VII DPR RI Eddy Soeparmo. He said that currently there are 2 crucial issues that are currently being formulated: namely, the issue of the Domestic Component Level (TKDN) and the issue of power wheeling.
“At the end of the month we allocate time to discuss the EBET Bill. There are only 2 remaining issues, TKDN is almost finished and Power Wheeling. “When it's finished, I think I can take it straight to the plenary,” he explained when met at the DPR RI Building, Jakarta, Thursday (13/6/2024).
In this way, the discussion of the EBET Bill is targeted to be completed before Indonesian President Jokowi's term of office ends, and possibly before the term of DPR members for the 2019-2024 period ends.
“We are targeting completion in this (President Jokowi's) period. Even if it is not completed, before the 2019-2024 term of office of the DPR members is completed, it will have been knocked down (validated into law),” he added.
Minister of Energy and Mineral Resources Arifin Tasrif revealed that until now the discussion regarding the EBET Bill still has several issues that need to be resolved. He said that there were at least four main points proposed by the government, especially from the Ministry of Energy and Mineral Resources, to add formulas that needed to be included in the EBET Bill.
“We want to respond to the issues that have been raised and we will also map out additional information from the ministry representatives who attended today's meeting,” said Arifin at the DPR RI Commission VII Working Meeting, Jakarta, Monday (11/20/2023).
So what are the latest formulations proposed by the government? Here's the list:
1. Economic Value of Carbon, Article 7B
Arifin said that carbon trading has not been included in the Problem Inventory List (DIM), especially in article 7B point 2 of the EBET Bill.
“Efforts to reduce greenhouse gas emissions as intended in paragraph (1) can be part of a carbon trading mechanism through emissions trading procedures, levies on carbon, and other mechanisms determined by the government in accordance with developments in technology and science,” he said.
Then, Arifin also revealed that in article 7B point 3, the implementation of the carbon trading mechanism as referred to in paragraph 2 is carried out in accordance with the provisions of environmental laws and regulations.
Apart from that, investment activities in developing EBT or energy conservation activities as an effort to reduce greenhouse gas emissions come from foreign funding. In this framework, in addition, the intergovernmental cooperation framework is implemented in accordance with the provisions of environmental laws and regulations.
2. Domestic Component Level (TKDN), Articles 24 and 39
Arifin said in Articles 24 and 39, especially in point 2a of the government's version, namely prioritizing domestic products and potential as referred to in paragraph 1 by considering:
– Availability or capability of domestic products and potential as referred to in paragraph 2
– Prices for new energy/renewable energy that remain competitive
– Providing flexibility according to funding sources for new energy and renewable energy.
“So this is our addition which may need to be explored further in order to reach an agreement,” he added.
3. Formulation of Network Cooperation (Open Access), Articles 29a and 47a
In general, the formulation of network cooperation provisions or open access regulates:
– The obligation for business area holders to meet consumer needs for electricity sourced from EBET.
– Mechanism if the business area holder cannot meet consumer needs, then the consumer can be provided with electricity supply through point-to-point cooperation in the use of generator rentals or electricity purchase and sale agreements with other business area holders.
“The mechanism referred to in number 2 is carried out through transmission and/or distribution efforts or what is also called power wheeling in English, we might use the language of distribution and transmission,” concluded Arifin.
To carry out the transmission and/or distribution business, Arifin said, open access to electricity distribution from EBET sources must be opened by charging fees regulated by the government.
This is provided that we maintain and pay attention to system reliability, customer service quality and the economics of the electricity transition and distribution business permit holder.
4. Use of EBET Funds, Article 56
1) Allocation of EBET Funds, Article 56 paragraph 3: The government proposes the use of EBET funds for, among other things: infrastructure financing, incentive financing, compensation for Business Entities developing EBET, R&D, increasing the capacity and quality of human resources, and subsidizing EBET prices that cannot yet compete with fossil energy prices.
2) EBET Fund Management Body, Article 56 paragraph 4: The government proposes that the EBET Fund be managed by the Minister of Finance by adding the phrase 'In accordance with statutory provisions'. Previously, the DPR proposed that the substance of managing EBET funds be carried out by a Special Renewable Energy Management Agency.
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