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Monday, 06 October 14
' COAL-BY-WIRE' FROM SUMATRA TO JAVA - THE JAKARTA POST
 Coal from the island of Sumatra accounts for most of Indonesia’s low-grade lignite, a low-quality coal that receives a poor price in international markets.
Given this low pricing combined with high transportation costs and the fact that most reserves are located in landlocked areas, it is not feasible to export Sumatra’s coal out of the island.
It is more efficient to use Sumatra’s coal for a mine-mouth power plant, an approach in which we develop a power plant very close to where mines are located, use the low-calorie coal from the mines to feed the plant, and transmit the electricity, rather than transporting a low-value commodity, out of the mines.
With mine-mouth, we no longer require either barges or expensive railway-heavy infrastructure to transport coal; rather we need to have long-distance high-voltage transmission lines to bring “coal-by-wire” from mines to consumer centers, either regions in Sumatra and/or Java-Bali.
Essentially, with “coal-by-wire” we are transporting a higher-value commodity by wire from mines to customers. Coal stays in the landlocked areas and feeds mine-mouth, coal-fired power plants.
“Coal-by-wire” would definitely boost the development of a domestic market for low-grade coal. Today, our market for coal is very thin as we are one of the world’s leading exporters of thermal coal of a high quality in the international market.
Our exports have increased very significantly within the past decade on account of demand from fast-growing Asian economies. More than 80 percent of our coal currently produced is exported.
Indeed, coal is currently the most important source of energy for our economy. For decades coal has accounted for more than half of our power-generation capacity. And this will continue for a half century to come before alternative and cleaner energy sources other than coal become affordably available.
Our economy is also growing, and of course will require more electricity power and therefore coal – challenges that have to be met. Electricity generation now consumes close to 75 million tons per year, and will almost triple in the next 10 to 15 years.
However, domestic use of coal today notoriously suffers from infrastructure bottlenecks. Congested barges and ports, as well as a shortage of railways limit the transportation of coal from coalmines in two coal-producing regions, Kalimantan and Sumatra, to demand centers in Java-Bali, where most of our power plants are located.
The majority of our coal reserves in the two regions are located in landlocked areas that require rail transportation infrastructure to reach ports for export.
Either truck haul or rail is needed to transport the coal to barge ports and terminals.
Truck operating costs are about twice that of rail, but existing rail transportation infrastructure is severely insufficient.
Indonesia’s attempts to improve coal-transport infrastructure for the domestic market have not been very successful. Dedicated coal ports in Kalimantan have been planned for many years, but implementation has again faced bottleneck issues.
Specialized railways for coal in Sumatra have also been initiated, but this concept is still under development and has not yet received a higher-level mandate or legal authorization.
Delays in expanding the capacity of barge and transportation infrastructure cause inefficiencies and high transportation costs in domestic coal utilization. These high costs and infrastructure bottlenecks have held back the development of the domestic market for coal.
Our high-voltage transmission lines are also astonishingly limited. The state-owned electricity company (PLN) operates approximately 40,000 kilometers of transmission lines, with less than 15 percent of this total serving the island of Sumatra.
If we can build more mine-mouth, coal-fired power generation plants we will need to expand our transmission network across the island, interconnected to other transmission systems in Java-Bali.
A new set of lines of a high-voltage of 500 kilovolts and medium-voltage of 275 kV needs to be developed as a backbone network across the island, i.e. providing long-distance, reliable and stable transmission.
The distribution system and transformer capacity also need to be expanded to service a larger coverage of costumers and demand centers.
We are required also to develop an interconnected transmission system, as existing electricity transmission is not compatible across regions due to different systems and manufacturer standards adopted in the past.
The current initiative of developing inter-island interconnection lines between Java and Sumatra with 500kV High Voltage Direct Current (HVDC) lines needs to be completed in harmony with the mine-mouth development.
These long-distance transmission and distribution lines, as well as interconnected systems are required to exist before a system of mine-mouth power plants is commissioned to ensure that electricity produced can be transmitted in a timely manner and with minimum cost.
Both the central and local governments must work hand-in-hand to endorse incentives to encourage the private sector — independent power producers (IPPs) — to develop mine-mouth power plants.
Incentives need to be designed to enhance the financial viability of IPPs’ mine-mouth power plant projects.
PLN as an off-taker of IPP plays a fundamental role as the “coal-by-wire” agent, and has to be ready to absorb all of the risks associated with the development and operation of the system, including the difficulties in land acquisition and intra-regional compatibility of transmission systems.
Sumatra with its huge resources of low-grade coal can secure its own electricity supply and, eventually, can be the source of low-cost electricity with its energy radiating not only to Java, but also to every corner of the country.
Source: The Jakarta Post
The writer is deputy for energy and mineral resources at the office of Coordinating Economic Minister.
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Tuesday, 16 September 14
INDONESIAN GOVERNMENT DECLARED HBA SUFFERED ANOTHER SETBACK IN SEPTEMBER
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia revised down the coal bench mark price once again in September. HBA for ...
Tuesday, 16 September 14
INDONESIAN COAL OUTPUT WON'T EXCEED 421M TONS: GOVT - JP
The government is optimistic that it will meet its coal production target for this year, which caps nationwide production at a flat number compared ...
Monday, 15 September 14
CHINA'S COAL PROPOSALS LEAVE SOME HOPE FOR EXPORTERS - DAILY NEWS
When the best thing you can say about new policies is that they aren’t as bad as they could have been, then you know your industry is in deep ...
Monday, 15 September 14
SUB-BIT FOB INDONESIA COAL SWAP, JANUARY 2015 DELIVERY GAINED DAY ON DAY AND WEEK ON WEEK
COALspot.com: Indonesian coal swaps for average October 2014 increased US$ 0.40 (+0.78%) day on day and US$ 0.55 (+1.08%) per mt week on week. The ...
Monday, 15 September 14
CFR SOUTH CHINA COAL SWAP GAINED DAY ON DAY AND WEEK ON WEEK
COALspot.com: API 8 CFR South China Coal swap for delivery in October 2014 decreased US$ 2.30 (-3.36%) month over month, but increased day on day a ...
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- Meralco Power Generation, Philippines
- McConnell Dowell - Australia
- Aditya Birla Group - India
- Jorong Barutama Greston.PT - Indonesia
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- Bayan Resources Tbk. - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sree Jayajothi Cements Limited - India
- Metalloyd Limited - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- Tamil Nadu electricity Board
- SN Aboitiz Power Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Baramulti Group, Indonesia
- Bhoruka Overseas - Indonesia
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Sarangani Energy Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Independent Power Producers Association of India
- Mintek Dendrill Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bukit Baiduri Energy - Indonesia
- Heidelberg Cement - Germany
- Samtan Co., Ltd - South Korea
- GVK Power & Infra Limited - India
- Manunggal Multi Energi - Indonesia
- Star Paper Mills Limited - India
- Carbofer General Trading SA - India
- Pipit Mutiara Jaya. PT, Indonesia
- Sakthi Sugars Limited - India
- Goldman Sachs - Singapore
- Coastal Gujarat Power Limited - India
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- Riau Bara Harum - Indonesia
- Orica Australia Pty. Ltd.
- CNBM International Corporation - China
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- PetroVietnam Power Coal Import and Supply Company
- London Commodity Brokers - England
- PowerSource Philippines DevCo
- Interocean Group of Companies - India
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Meenaskhi Energy Private Limited - India
- Kideco Jaya Agung - Indonesia
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- Mercuria Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- Thiess Contractors Indonesia
- Bhatia International Limited - India
- Global Business Power Corporation, Philippines
- Latin American Coal - Colombia
- Indonesian Coal Mining Association
- Energy Development Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- IHS Mccloskey Coal Group - USA
- PTC India Limited - India
- Toyota Tsusho Corporation, Japan
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- Bukit Makmur.PT - Indonesia
- Parliament of New Zealand
- Bulk Trading Sa - Switzerland
- Orica Mining Services - Indonesia
- Simpson Spence & Young - Indonesia
- Gujarat Electricity Regulatory Commission - India
- GAC Shipping (India) Pvt Ltd
- Xindia Steels Limited - India
- Formosa Plastics Group - Taiwan
- Uttam Galva Steels Limited - India
- Commonwealth Bank - Australia
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- Vedanta Resources Plc - India
- Indo Tambangraya Megah - Indonesia
- Jaiprakash Power Ventures ltd
- Petron Corporation, Philippines
- Madhucon Powers Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Banpu Public Company Limited - Thailand
- Krishnapatnam Port Company Ltd. - India
- Karbindo Abesyapradhi - Indoneisa
- Savvy Resources Ltd - HongKong
- Romanian Commodities Exchange
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- The University of Queensland
- GN Power Mariveles Coal Plant, Philippines
- Kaltim Prima Coal - Indonesia
- Ministry of Mines - Canada
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- Siam City Cement PLC, Thailand
- South Luzon Thermal Energy Corporation
- ICICI Bank Limited - India
- Kumho Petrochemical, South Korea
- Sojitz Corporation - Japan
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- Marubeni Corporation - India
- Port Waratah Coal Services - Australia
- Rio Tinto Coal - Australia
- Siam City Cement - Thailand
- SMC Global Power, Philippines
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Price Waterhouse Coopers - Russia
- Borneo Indobara - Indonesia
- VISA Power Limited - India
- Sical Logistics Limited - India
- Global Coal Blending Company Limited - Australia
- Straits Asia Resources Limited - Singapore
- Essar Steel Hazira Ltd - India
- MS Steel International - UAE
- Africa Commodities Group - South Africa
- Georgia Ports Authority, United States
- Eastern Coal Council - USA
- Ind-Barath Power Infra Limited - India
- Vizag Seaport Private Limited - India
- Wilmar Investment Holdings
- Coalindo Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Indika Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Intertek Mineral Services - Indonesia
- Oldendorff Carriers - Singapore
- Minerals Council of Australia
- CIMB Investment Bank - Malaysia
- The Treasury - Australian Government
- Trasteel International SA, Italy
- Timah Investasi Mineral - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Kobexindo Tractors - Indoneisa
- San Jose City I Power Corp, Philippines
- Gujarat Sidhee Cement - India
- Semirara Mining Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Standard Chartered Bank - UAE
- Leighton Contractors Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Iligan Light & Power Inc, Philippines
- Agrawal Coal Company - India
- Thai Mozambique Logistica
- Bharathi Cement Corporation - India
- Mercator Lines Limited - India
- Videocon Industries ltd - India
- Central Electricity Authority - India
- White Energy Company Limited
- IEA Clean Coal Centre - UK
- Sinarmas Energy and Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Kepco SPC Power Corporation, Philippines
- Mjunction Services Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Bhushan Steel Limited - India
- LBH Netherlands Bv - Netherlands
- Chamber of Mines of South Africa
- Globalindo Alam Lestari - Indonesia
- Therma Luzon, Inc, Philippines
- Barasentosa Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- International Coal Ventures Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Power Finance Corporation Ltd., India
- Jindal Steel & Power Ltd - India
- Planning Commission, India
- Singapore Mercantile Exchange
- Cement Manufacturers Association - India
- Ambuja Cements Ltd - India
- Parry Sugars Refinery, India
- SMG Consultants - Indonesia
- TeaM Sual Corporation - Philippines
- Cigading International Bulk Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Karaikal Port Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- Altura Mining Limited, Indonesia
- Electricity Authority, New Zealand
- Tata Chemicals Ltd - India
- Ministry of Transport, Egypt
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Energy Link Ltd, New Zealand
- PNOC Exploration Corporation - Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- Coal and Oil Company - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Posco Energy - South Korea
- Eastern Energy - Thailand
- Merrill Lynch Commodities Europe
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Economic Council, Georgia
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