“Electricity was all the country needed to take off the huge growth. A growth in electric demand averaging 19 percent per annum for twelve years after the new system was completed, tapering down to 17 percent for eight more years, and then holding at 15 percent for the remainder of the twenty-five-year projection” [1].

-US Economist, John Perkins, 1971

In 1971, Perkins showed the fake results of his economic analysis to President Suharto with electrification mega project and offers a financing scheme and recommendations on the amount of debt channeled by the IMF and World Bank. One of the conditions, the government must channel 90 percent of the debt to US contractors. Corporatocracy and kleptocracy are seen from the Paiton I and II steam coal power plant project worth US $ 4 billion [2]. This mega project is useless because the price of electricity produced is 60 percent more expensive than in the Philippines or 20 times more expensive than in the US. The new order corruption began when a 15.75 percent megaproject was paid to Suharto’s cronies and family. After Suharto was overthrown in 1998, the Indonesian government asked for independent financial review of Paiton by Canadian auditors, who concluded that project cost was inflated by as much as 72 percent [3].

This predatory capitalism has trapped Indonesia to foreign debt and various adverse environmental effects. Even more than 40 years later, a similar case which is also dominated by Chinese capital was repeated in the corruption case of the Riau-1 mine mouth coal power plant. Riau-1, however, is only one of dozens of steam power plants planned to be built throughout Indonesia, as part of the government’s ambitious drive to add 35,000 megawatts of electricity to national networks in the coming years. According to the Association for Action on Ecology and Emancipation of the People (PAEER), there are at least 18 similar plants at various stages of development – from licensing and land acquisition, to procurement of technology – which are also suspected of being tarnished by corruption [4]. Rizal Ramli, the former minister of Maritime and Resources Coordinating Minister predicted that the 35,000 megawatt project could endanger PLN’s (Indonesia State Electricity Company) finances if it was over capacity dominated by independence private producer (IPP) then the supply exceeds the demand, there is idle, the PLN is still obliged to pay electricity costs to private companies based on the Electricity Purchase Agreement (PPA), between PLN and IPP. This means that using electricity is not used, PLN must pay it to a private company [5]. This sort of thing has been planned by foreign debtor by bribing the political elite so that Indonesia will not be able to repay loans and then control Indonesia for the United Nations votes, the installation of military bases and the only way out is to give the foreign debtor control of that they had built.

PLN successfully signed an agreement on Syndicated Loan Facilities worth US $ 1.62 billion banks on 2018 [6]. The private sector is expected to play a larger role in the energy sector since Electricity Law No. 30/2009 ended PLN’s legal monopoly over Indonesia’s power generation, transmission and distribution of the power sector it can backfire when the private sector dominates which most projects are funded by China and there are chances for PLN failure payment.

Figure 1. PLN Funding Gap, 2015-2019 ($ billion) [7]

What are called mine mouth power plants such as Riau-1 — which are built close to coal mines that supply their fuel, and which contracts given by PLN are not transparent. Starting from illogical planning, the process of land acquisition involving violence, and the process of issuing corrupt licenses. Mine mouth power plants require more lignite to produce the same amount of electricity that burn higher levels of coal. Lignite has a lower calorific value which have a greater impact on people’s health and the environment especially GHG emission and leads to more pollution.

Figure 2. Indonesia Power Plant GHG Emissions [8]

The problem is further compounded by the fact that, in Indonesia, these factories are usually located in rural or remote areas with limited access to health services. When local residents realize the impact of a steam power plant, it is usually too late. According to Greenpeace, estimated numbers of early deaths due to the coal power plant, which is currently operational, reach around 6,500 people per year in Indonesia[9].

Causes of corruption vary across countries and will depend on national policies, history, bureaucratic traditions, and political development. The corruption remains such a large problem in Indonesia in spite of several reforms such as decentralization and establishment of an anti-corruption agency (KPK) [10]. But in fact, the greater the policy of a country or region held by many leaders, the greater the chance of corruption. Decentralization which is expected to be a spirit of democracy is instead used as a system of oligarchy by unscrupulous leader.

Now, the millennial generation is exploring the transition period to take part in taking state policies and the various things mentioned above are the burden left by the predecessor. Most important thing to start off by saying is that we are living at a time in history when the individual, us, has more power than ever before. We should wake up to the fact that we live on a very tiny space station with no shuttles, and it’s headed for disaster, and we’ve got to turn it around.

Look for and spread a story behind the story

Democracy depends upon transparency. It depends on understanding the story behind the story. It demands that we look for the story of our leaders and our government policies. Information disclosure that is very easy to access using the internet can be the media to tell a story behind the story. Recently, revelations such as WikiLeaks, Edward Snowden Papers, Panama papers, and even of top spot in list of most corrupt world leaders of recent history in which from Indonesia, President Suharto, reporting by amazing bloggers and organizations out there are shining a light on the fact that we have corrupt politician and we have tax evading billionaires.

Empowering local individual and communities

Join and get involved on organization or start one that impacts local, national, even global laws. As millennial we certainly want the change. Democracy in Indonesia has not been long and there needs to be a lot of lessons and revisions to be made. Use local power to change politics, to change the governmental system, to change the law. We can’t wait for the president to do it, whoever the next president is. We must do it, and that’s our job in our democracy to do that. With and as communities, we the people should force corporations to clean up polluted rivers, air and land. We have the power to move them toward

We are going through a re-evolution a consciousness revolution. People are waking up across the planet. We’re going to come together, and we are going to create a world for every other child of every sentient being on this planet.

this essay is used for the Indonesian Young Thought Leaders on Environment 2019 competition. Further information:
https://wri-indonesia.org/en/our-work/project/indonesian-young-thought-leaders-environment-2019

Reference

[1]      John Perkins, The New Confessions of an Economic Hitman. 2016

[2]      T. Guide, “Power in Indonesia,” August, 2015.

[3]      S. Hiatt, A Game As Old As Empire: The Secret World of Economic Hit Men and the Web of Global Corruption. 2007.

[4]      H. N. Jong, “Antara PLTU di Indonesia, Korupsi, dan Masalah Kesehatan dan Lingkungan,” 2018. [Online]. Available: https://www.matamatapolitik.com/antara-pltu-di-indonesia-korupsi-dan-masalah-kesehatan-dan-lingkungan/.

[5]      H. Henricus, “Ramalan Rizal Ramli Soal Proyek 35.000 MW yang Bisa Bikin PLN Bangkrut,” 2017. [Online]. Available: https://finance.detik.com/energi/d-3660193/ramalan-rizal-ramli-soal-proyek-35000-mw-yang-bisa-bikin-pln-bangkrut.

[6]      C. Mulyana, “PLN Peroleh Pinjaman Sindikasi US$1,62 Miliar,” 2018. [Online]. Available: http://mediaindonesia.com/read/detail/195586-pln-peroleh-pinjaman-sindikasi-us162-miliar.

[7]      P. Tharakan, “SUMMARY OF INDONESIA’S ENERGY SECTOR ASSESSMENT,” no. 09. 2015

[8]      KESDM, “Data Inventory Emisi GRK Sektor Energi.” 2016

[9]      K. ERDIANTO, “Studi: Kematian Akibat PLTU Batubara Mencapai 6.500 Jiwa per Tahun,” 2016. [Online]. Available: https://nasional.kompas.com/read/2016/02/08/10064911/Studi.Kematian.Akibat.PLTU.Batubara.Mencapai.6.500.Jiwa.per.Tahun.

[10]    L. Learnt, “Causes of corruption in Indonesia 1 Corruption in Indonesia,”  August 2012.