Selective CAPEX-to-OPEX Transformation in Electricity Infrastructure Asset Management: Financial Trade-offs and Governance Implications for PT PLN (Persero)
Article Sidebar
Main Article Content
Abstract
PT PLN (Persero) faces increasing pressure to expand and modernize electricity infrastructure while maintaining financial resilience, operational reliability, and technological adaptability. This study examines the strategic implications of selectively transforming infrastructure investment from capital expenditure (CAPEX)-based ownership toward operational expenditure (OPEX)-oriented arrangements. The study employed an integrated analytical design, combining documentary analysis, global benchmarking, financial scenario simulation, cost–benefit analysis, and regulatory assessment. The simulation assumes total investment requirements of Rp2,780 trillion for 2025–2034, a 2024 CAPEX baseline of Rp63.45 trillion, and the transfer of 70% of generation investment to Independent Power Producers while 30% of generation and 100% of transmission and distribution remain under PLN CAPEX. The results show a clear trade-off. Interest-bearing debt decreases by 6.75%, and the Debt Service Coverage Ratio increases by 3.8%, while OPEX rises by 24.88%, EBITDA declines by 36.99%, operating income by 7.63%, net income by 9.93%, ROA by 7.0%, and leverage increases by 48.1%. The cost–benefit analysis further shows that OPEX generates higher estimated ten-year benefits of Rp1,598.62 trillion than CAPEX at Rp726.45 trillion, whereas CAPEX produces a higher benefit–cost ratio of 17.01 than OPEX at 8.83. These findings indicate that OPEX should not be treated as a universal substitute for CAPEX. Instead, the optimal configuration is a selective portfolio in which OPEX or hybrid arrangements are applied to technologically dynamic and contractible assets, while strategically critical and long-lived infrastructure remains under direct ownership. The study contributes a contingent asset-governance perspective that integrates asset characteristics, financial consequences, risk allocation, and governance requirements in infrastructure investment decisions.
Article Details
References
Abednego, M. P., & Ogunlana, S. O. (2006). Good project governance for proper risk allocation in public–private partnerships in Indonesia. International Journal of Project Management, 24(7), 622–634. https://doi.org/10.1016/j.ijproman.2006.07.010
Alvarez-Alvarado, M. S., Donaldson, D. L., Recalde, A. A., Noriega, H. H., Khan, Z. A., Velasquez, W., & Rodriguez-Gallegos, C. D. (2022). Power system reliability and maintenance evolution: A critical review and future perspectives. IEEE Access, 10, 51922–51950. https://doi.org/10.1109/ACCESS.2022.3172697
Baines, T. S., Lightfoot, H. W., Benedettini, O., & Kay, J. M. (2009). The servitization of manufacturing: A review of literature and reflection on future challenges. Journal of Manufacturing Technology Management, 20(5), 547–567. https://doi.org/10.1108/17410380910960984
Brunekreeft, G., & Rammerstorfer, M. (2021). OPEX-risk as a source of CAPEX-bias in monopoly regulation. Competition and Regulation in Network Industries, 22(1), 20–34. https://doi.org/10.1177/1783591720983184
Cambini, C., Meletiou, A., Bompard, E., & Masera, M. (2016). Market and regulatory factors influencing smart-grid investment in Europe: Evidence from pilot projects and implications for reform. Utilities Policy, 40, 36–47. https://doi.org/10.1016/j.jup.2016.03.003
De Oliveira-De Jesus, P. M., & Antunes, C. H. (2018). Economic valuation of smart grid investments on electricity markets. Sustainable Energy, Grids and Networks, 16, 70–90. https://doi.org/10.1016/j.segan.2018.05.003
Dinçer, H., Krishankumar, R., Yüksel, S., & Ecer, F. (2025). Evaluating smart grid investment drivers and creating effective policies via a fuzzy multi-criteria approach. Renewable and Sustainable Energy Reviews, 208, 115052. https://doi.org/10.1016/j.rser.2024.115052
Favoretto, C., Mendes, G. H. S., Oliveira, M. G., Cauchick-Miguel, P. A., & Coreynen, W. (2022). From servitization to digital servitization: How digitalization transforms companies' transition towards services. Industrial Marketing Management, 102, 104–121. https://doi.org/10.1016/j.indmarman.2022.01.003
Fleta-Asín, J., & Muñoz, F. (2021). Renewable energy public–private partnerships in developing countries: Determinants of private investment. Sustainable Development, 29(4), 653–670. https://doi.org/10.1002/sd.2165
Gebauer, H., Fleisch, E., & Friedli, T. (2005). Overcoming the service paradox in manufacturing companies. European Management Journal, 23(1), 14–26. https://doi.org/10.1016/j.emj.2004.12.006
Giner, B., Merello, P., & Pardo, F. (2019). Assessing the impact of operating lease capitalization with dynamic Monte Carlo simulation. Journal of Business Research, 101, 836–845. https://doi.org/10.1016/j.jbusres.2018.11.049
Górowski, I., Kurek, B., & Szarucki, M. (2022). The impact of a new accounting standard on assets, liabilities and leverage of companies: Evidence from energy industry. Energies, 15(4), 1293. https://doi.org/10.3390/en15041293
Kohtamäki, M., Parida, V., Oghazi, P., Gebauer, H., & Baines, T. (2019). Digital servitization business models in ecosystems: A theory of the firm. Journal of Business Research, 104, 380–392. https://doi.org/10.1016/j.jbusres.2019.06.027
Kolagar, M., Parida, V., & Sjödin, D. (2022). Ecosystem transformation for digital servitization: A systematic review, integrative framework, and future research agenda. Journal of Business Research, 146, 176–200. https://doi.org/10.1016/j.jbusres.2022.03.067
Leiva Vilaplana, J. A., Yang, G., & Ackom, E. (2025). From investment to net benefits: A review of guidelines and methodologies for cost–benefit analysis in the electricity sector. Energy Research & Social Science, 124, 104052. https://doi.org/10.1016/j.erss.2025.104052
Leiva Vilaplana, J. A., Yang, G., Monaco, R., Bergaentzlé, C. M., Ackom, E., & Morais, H. (2025). Digital versus grid investments in electricity distribution grids: Informed decision-making through system dynamics. Applied Energy, 386, 125536. https://doi.org/10.1016/j.apenergy.2025.125536
Lopes, A. I., & Penela, D. (2025). The impact of IFRS 16 on lessees' financial information: A single-industry study. Advances in Accounting, 68, 100803. https://doi.org/10.1016/j.adiac.2024.100803
Mirshekali, H., Mortensen, L. K., & Shaker, H. R. (2024). Reliability-aware multi-objective approach for predictive asset management: A Danish distribution grid case study. Applied Energy, 358, 122556. https://doi.org/10.1016/j.apenergy.2023.122556
Monaco, R., Bergaentzlé, C., Leiva Vilaplana, J. A., Ackom, E., & Nielsen, P. S. (2024). Digitalization of power distribution grids: Barrier analysis, ranking and policy recommendations. Energy Policy, 188, 114083. https://doi.org/10.1016/j.enpol.2024.114083
Morales-Díaz, J., & Zamora-Ramírez, C. (2018). The impact of IFRS 16 on key financial ratios: A new methodological approach. Accounting in Europe, 15(1), 105–133. https://doi.org/10.1080/17449480.2018.1433307
Mortensen, L. K., Sundsgaard, K., Shaker, H. R., Hansen, J. Z., & Yang, G. (2024). Designing digitally enabled proactive maintenance systems in power distribution grids: A scoping literature review. Energy Reports, 12, 1–21. https://doi.org/10.1016/j.egyr.2024.08.044
Neely, A. (2008). Exploring the financial consequences of the servitization of manufacturing. Operations Management Research, 1(2), 103–118. https://doi.org/10.1007/s12063-009-0015-5
Ng, A., & Loosemore, M. (2007). Risk allocation in the private provision of public infrastructure. International Journal of Project Management, 25(1), 66–76. https://doi.org/10.1016/j.ijproman.2006.06.005
Nur, S., Burton, B., & Bergmann, A. (2023). Evidence on optimal risk allocation models for Indonesian geothermal projects under PPP contracts. Utilities Policy, 81, 101511. https://doi.org/10.1016/j.jup.2023.101511
aschou, T., Rapaccini, M., Adrodegari, F., & Saccani, N. (2020). Digital servitization in manufacturing: A systematic literature review and research agenda. Industrial Marketing Management, 89, 278–292. https://doi.org/10.1016/j.indmarman.2020.02.012
Reim, W., Parida, V., & Örtqvist, D. (2015). Product–Service Systems (PSS) business models and tactics—A systematic literature review. Journal of Cleaner Production, 97, 61–75. https://doi.org/10.1016/j.jclepro.2014.07.003
Shaghaghi, A., Taghitahooneh, M., Yahyaeifar, M., & Dashti, R. (2024). Management of aging assets in power distribution systems: A comprehensive review. Energy Strategy Reviews, 55, 101529. https://doi.org/10.1016/j.esr.2024.101529
Singh, M., Jiao, J., Klobasa, M., & Frietsch, R. (2022). Servitization of energy sector: Emerging service business models and startup's participation. Energies, 15(7), 2705. https://doi.org/10.3390/en15072705
Sklyar, A., Kowalkowski, C., Tronvoll, B., & Sörhammar, D. (2019). Organizing for digital servitization: A service ecosystem perspective. Journal of Business Research, 104, 450–460. https://doi.org/10.1016/j.jbusres.2019.02.012
Tukker, A. (2004). Eight types of product–service system: Eight ways to sustainability? Experiences from SusProNet. Business Strategy and the Environment, 13(4), 246–260. https://doi.org/10.1002/bse.414
Vandermerwe, S., & Rada, J. (1988). Servitization of business: Adding value by adding services. European Management Journal, 6(4), 314–324. https://doi.org/10.1016/0263-2373(88)90033-3
Visnjic, I., Jovanovic, M., Neely, A., & Engwall, M. (2017). What brings the value to outcome-based contract providers? Value drivers in outcome business models. International Journal of Production Economics, 192, 169–181. https://doi.org/10.1016/j.ijpe.2016.12.008
Wibowo, A., & Mohamed, S. (2010). Risk criticality and allocation in privatized water supply projects in Indonesia. International Journal of Project Management, 28(5), 504–513. https://doi.org/10.1016/j.ijproman.2009.08.003
Institutional and regulatory references
PT PLN (Persero). (2017). IPP procurement division. PT PLN (Persero).
PT PLN (Persero). (2021). Green finance framework. PT PLN (Persero).
PT PLN (Persero). (2022). Pedoman good corporate governance (GCG). PT PLN (Persero).
PT PLN (Persero). (2024). Laporan keuangan konsolidasian PT PLN (Persero) dan entitas anak. PT PLN (Persero). These PLN documents were also already included among the source materials of the original manuscript.