Tuesday, April 16, 2024

Bridging funding gap in RUPTL projects: PLN asked to engage int’l partners

Reading Time: 2 minutes
Audina Nur




The Ministry of Energy and Mineral Resources (ESDM) asks State electricity company PT PLN to expand its business scheme related to fundraising for projects outlined in the Electricity Supply Business Plan (RUPTL) 2021-2030 as a measure to provide an alternative investment avenue currently unavailable to PLN.

 “The initiative is necessary so that all funding is not solely dependent on PLN,” Secretary General of the Ministry of Energy and Mineral Resources, Dadan Kusdiana, said as quoted byBisnis.com on Tuesday, January 30, 2024.

This push becomes crucial after the Supreme Audit Agency (BPK) recently revealed a funding gap of Rp108.67 trillion (US$6.9 billion) recorded by PLN for the development of power plants and other electricity infrastructure outlined in the RUPTL 2021-2030. According to the audit agency, this funding gap has resulted in suboptimal realization of power plant and other electricity infrastructure development in the RUPTL 2021-2030. Based on PLN’s Company Work and Budget Plan (RKAP) for 2021 and 2022, the investment needs for projects outlined in the RUPTL were Rp78.90 trillion and Rp73.10 trillion respectively.

However, PLN only managed to raise funds amounting to Rp19.93 trillion for 2021 and Rp23.4 trillion for 2022. These funds were raised through subsidiary loan agreements (SLA), project loans, state capital injections (PMN), internal funds, and result-based loans & pay for result loans (RBL).

The investment gap in the electricity sector is detailed in the Audit Results Report (LHP) on the Management of Coal, Natural Gas, and Renewable Energy in the Development of the electricity sector to ensure availability, affordability, and energy sustainability for the Fiscal Year 2020 up to the First Semester of 2022 at the Ministry of Energy and Miniseral Resources and other relevant institutions, which was ratified on May 9, 2023.

Dadan stated that the potential for international funding to assist in PLN’s planned projects outlined in the RUPTL is significant. He hopes that the state-owned electricity company can attract investment opportunities domestically to drive the realization of delayed development projects in the RUPTL.

“The potential for international funding is significant, including those committed by Just Energy Transition Partnership (JETP),” he said.

Contacted separately, PLN’s Executive Vice President of Corporate Communications and Social and Environmental Responsibility, Gregorius Adi Trianto, said the company is committed to accelerating the development of electricity infrastructure as planned in the RUPTL 2021-2030.

“This development cannot be done by PLN alone; as a state-owned enterprise, PLN must consider sustainable financial health conditions and corporate investment allocations,”  Adi said.

Regarding the company’s financial ratios, the BPK examined PLN’s debt service coverage ratios (DSCR) for 2022 and 2023, which were at 0.85 and 0.92 respectively. DSCR is a financial ratio that measures a company’s operational income ability to cover total obligations. The minimum required DSCR is 1.5, while PLN’s DSCR for 2021 and 2022 were only 0.82 and 0.92 respectively. This means that PLN cannot currently repay its debt obligations without drawing from external sources.

Meanwhile, the self-financing ratio is financing that can be provided by the credit applicant themselves. The projected financial ratio of PLN in 2022 and 2023 was 12 percent and 20 percent respectively, while the minimum requirement to be fulfilled was 15 percent. This means that PLN does not have the required cash flow to apply for new loans.

According to common financial practices, both ratios are mandatory requirements that will be evaluated by financing institutions. BPK believes that these two ratios will make it difficult for PLN to meet the required covenants.

Audina Nur






We will provide you with an invoice for your reimbursable expenses.


New to Indonesian market? Read our free articles before subscribing to the premium plan. If you already run your business in Indonesia, make sure to subscribe to the premium subscription so you won’t miss any intelligence & business opportunities.


$550 USD/Year


$45 USD/Month

Cancelation: you can cancel your subscription at any time, by sending us an email inquiry@ibp-media.com

Add keywords to your market watch and receive notification:
No topics
Schedule a free consultation with us:

We’ll contact you for confirmation.


The Coordinating Ministry for the Economy held a coordination meeting with all Deputy Ministerial elements along with the Ministry of Foreign Affairs and several Ambassadors on Monday, April 15, 2024 in response to developments in the Middle East conflict following Iran’s retaliatory offensive against Israel. 
The textile and textile product (TPT) industry asks all stakeholders to comply with import restriction policies as regulated in Minister of Trade Regulations No. 36/2023 and No. 3/2024 on Import policy and control. 
The government has spoken out regarding Indonesia’s stance on Iran’s recent attack on Israel, asking the United Nations Security Council (UNSC) to take swift action to de-escalate tensions in the region.
A statement by Speaker of the People’s Consultative Assembly (MPR) Bambang Soesatyo which suggests that democracy in Indonesia does not require opposition has drawn criticism from experts. 
In the wake of the quinquennial political festivity, the movement towards reconciliation among competing factions within Indonesia’s political coalition has become an integral part of the country’s political dynamics.
Cooperation among government’s agencies and ministries is needed to prevent corruption cases, such as the alleged corruption at PT Timah which has incurred US$ 13.6 billion in State losses based on calculation of an IPB University expert.