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]).