Hamud M. Balfas June 1 2012 New cross-border power sale and purchase regime in place ABNR | Energy & Natural Resources - Indonesia Hamud M. Balfas Energy & Natural Resources In order to implement the Electricity Law (30/2009), Government Regulation 42/2012 on Cross-Border Power Sale and Purchase was signed by the president on March 12 2012. The regulation stipulates that cross-border power sale and purchase, like the export and import of goods, are subject to the prevailing customs laws and regulations. Under the regulation, the cross-border sale of electricity may be conducted only if the following requirements are fulfilled: The electricity needs of the respective area, and its surrounding areas, have been satisfied; The electricity sale prices are not subsidised; and The sale will not compromise the reliability of the local electricity supply. The conditions for the cross-border purchase of electricity include the following: Local electricity needs are not fully satisfied; The purchase is intended to meet local electricity needs or to improve the quality and reliability of local electricity supply; and The purchase will not create a dependency on electricity imports. Cross-border electricity sale and purchase require a permit from the minister in charge of electricity. Permit holders are obliged to submit semi-annual reports on their activities to the minister. The regulation imposes certain requirements on cross-border electricity purchase, such as a requirement to obtain the minister's approval of the purchase price, which do not apply to cross-border electricity sale. The regulation became immediately effective on the date of issue. For further information on this topic please contact Hamud Balfas at Ali Budiardjo, Nugroho, Reksodiputro by telephone (+62 21 250 5125), fax (+62 21 250 5121) or email ([email protected]).