JAKARTA | Thu May 3, 2012 8:19am EDT
JAKARTA May 3 (Reuters) - Indonesia will halt indefinitely a plan to restrict subsidised fuel use based on vehicle year or engine size, the energy and mining minister said on Thursday.
The government also said the state utility firm PLN must convert its existing oil-based power plants to coal, gas, hydro and geothermal.
Indonesia's parliament in March gave the government the authority to raise subsidised fuel prices under certain conditions. The prices are currently the lowest in Asia and higher prices or subsidy curbs could have an impact on both the politics and the economics of Southeast Asia's largest economy.
"To control private vehicles there was (a plan to limit subsidised fuel use based on) engine size and year (of production). After trials on the ground it will be difficult to implement it using the regulations," minister Jero Wacik said at a news conference.
"So for the time being the regulation will be halted until we find the right formula," Wacik said, adding that official cars and mining and plantation vehicles will be prohibited from using subsidised fuel.
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