Inadequate Electrical Supply is Contributing to Slowdown of New Investments in Bali.
(5/26/2009) The Jakarta Post reports that limited power supplies are causing headaches for domestic and foreign investors in Bali.
Quoting the vice-chairman of the Bali branch of the Indonesian Chamber of Commerce (KADIN), Tedja Nandi Yasa, the lack of power on Bali's electrical grid has become severe: "We (Kadin) have been working hard to promote Bali, but the anxiety over the minimum electricity supply has eliminated almost 50 percent of the chance to invest here."
According to Yasa, efforts to lobby both the central and provincial government to takes steps to increase electrical supplies have had minimum effect.
It's unclear how much the lack of electrical power is to blame for the steep downturn in new investment in Bali. The Bali Investment Coordinating Board (BKPM-Bali) reported only US$5.12 million in new investment during Q1 2009 against a targeted US$572 million.
Currently, Bali's power grid has the capacity of handling 562 megawatts with peak hour consumption reaching 490 megawatts.
In a step to supplement power reserves, a controversial coal-powered plant is being built at Celukan Bawang in North Bali. Although designed to add 390 megawatts of additional power, that project is encountering numerous delays and is unlikely to come on line as scheduled by the end of 2010.
Alternative plans to install an extra-high-voltage aerial transmission line (SUTET) to bring 1,000 megawatts of power to Bali from East Java have been vetoed by Bali's governor. The governor's objections were reportedly based on his concern that the proposed high power transmission lines would transect the the West Bali National Park, home of the last population of endangered Bali Starlings, and sacred temple areas on Bali.
Economist Wayan Ramantha from Bali's Udayana University has pointed to Bali's poor infrastructure and public facilities as also contributing to the island's lack of attractiveness to potential investors. He also cited the lack of clear regulations and taxation systems.
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