1. COUNTRY REPORT INDONESIA THE HAPUA Working Group No. 5 – ESI Services Project No. 5 – Regulatory Issues and Challenges of Regulated Entity/Owner/Investor and Consumers

2. INDONESIA ARCHIPELAGOS Bengkulu Bangka Sumsel- Lampung Pontianak Banjarmasin Tarakan Minahasa Kotamobagu Palu Sorong B-Aceh Medan Padang Bima Sumbawa Kupang Ambon Serui Gorontalo Jayapura Mahakam

3. INDUSTRY STRUCTURE SINGLE BUYER CONSUMERS Basic Electricity Tariff PSA (yearly) PPA (yearly) PPA (long term) TSA (yearly) PLN TRANSMISSION EXCESS POWER (MV,LV ) PLN & IPP EMBEDDED GENERATION (MV) EXCESS POWER (HV ) PLN GENCOs IPPs PPA (short term) Transfer Agreement RENEWABLE ENERGY (MV,LV ) Legend : - PPA = Power Purchase Agreement - PSA = Power Sales Agreement - TSA = Transmission Service Agreement PLN GENERATION PPA (short term) PLN DISTRIBUTION

4. REGULATORY ENVIRONMENT & FRAMEWORK Indonesian Principal Law : UUD 1945 Electricity Act : UU No. 15, 1985 Government Regulation Precidential Regulation Precidential Decree Ministry Regulation Director of Jenderal Decree The Regulatory Hierarchy of Electricity :

5. INDUSTRY REGULATIONS Adequacy of Supply – Government Regulation (PP No. 26, 2006) Security, Quality & Reliability – Government Regulation (PP No. 26, 2006 & regulated in SNI) Performance of efficiency – Government Regulation (PP No. 26, 2006 & regulated in SNI) Electricity Acceleration Project : – Precidential Regulation No. 91, 2007 (10,000 MW) Regulation for State Owned Enterprises – UU No. 19,2003 (PSO)

6. INDUSTRY REGULATIONS Safeguarding consumer interest : – UU No. 8, 1999 – Government Regulation (PP No. 26, 2006) Tariff Setting : Precidential Decree on Basic Electricity Tariff Electricity Planning : – UU No. 15, 1985 (RUKN) – UU No. 10, 1986 (RUPTL)

7. BEST PRACTICES in REGULATION Grid Code Distribution Code

8. CHALLENGES in REGULATION Electricity Act No. 20/2002 had no longer exist The new regulation (substitution of Electricity Act 20/2002) is being discussed by government and the parliament. The possibility to implement regionalism and restructuring still opened

9. Thank You