Demand for Electricity in Indonesia the Case of Quantity Demanded for Electricity in PT PLN (Persero) 1982-2002

Abstract

More advances in the community social welfare creates more demand in a certain product. Nowadays, every body uses electronic tools to make their life become easier. Therefore, electricity becomes the commodity that is needed by many sectors. Every people need electricity in their daily life because in this modern era, most activities need electricity. Because the electricity is very useful in every activity, it would create a demand for electricity. Electricity in Indonesia was provided by PT PLN as the only state-owned company that has the authorities in electricity business over the country. Based on the PLN data, the quantity demand for electricity in Indonesia is increasing from time to time. It reflects that electricity is needed more and more by the Indonesia citizen. Nowadays, the condition of demand for electricity in Indonesia is high, thus PT PLN as the supplier of electricity cannot cover all of the demand. PT PLN can only cover about 60% from the total demand ofelectricity. This research was conducted in order to know the demand for electricity in Indonesia and to identify the factors that influencing to the quantity demand for electricity in Indonesia. The research only deals with the demand of electricity in PT PLN because most of the demand of electricity in Indonesia comes from PT PLN and the other demand electricity is shared with so many private companies, therefore it is difficult to collect the accurate data. This research was using time series data from 1982 to 2002. The research used per capita income and per capita demand in measuring the quantity demand for electricity. This research summarizes the determination of the quantity demand for electricity per capita on PT PLN (PERSERO); they are Indonesian Gross Domestic Product per capita, Prices of Oil, and the amount of PT PLN customer. The coefficient determination R-square is 0.996247. Here, the price of oil is the dominant factor influencing the quantity demand for electricity per capita in PT PLN. Therefore, the price of oil variable is needed to get more attention. PT PLN should have more consideration in determining the electricity prices respect to the price of oil because if PLN does not do so, it will lose some of their potential demand for electricity.