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Monday, 24 June 24
PLN'S FINANCIAL SUSTAINABILITY RESTS ON ACCELERATED COAL RETIREMENT AND RENEWABLES DEPLOYMENT - MUTYA YUSTIKA
 On 28 May 2024, Indonesia’s national electricity utility, PT Perusahaan Listrik Negara (PLN), released its financial report for 2023. Although the report showed a net profit increase of IDR22 trillion (tn), a 53% rise from 2022, the Institute for Energy Economics and Financial Analysis (IEEFA) calculates that PLN would have recorded a substantial loss of IDR120tn without subsidies and compensations from the Government of Indonesia (GOI).
At first glance, PLN’s cash reserves increased by 9% for the fiscal year 2023, and its electricity sales rose around 7%. This increase in sales contributed the most to PLN’s income growth, amounting to IDR22.2tn. However, despite the improved performance and positive figures, there are underlying red flags.
Despite increased cash reserves, PLN’s liquidity ratio (0.92), quick ratio (0.79), and cash ratio (0.39) were all below 1.00. These figures indicate that the utility is struggling to meet its urgent payment obligations with cash or current assets.
PLN’s financial performance heavily depends on GOI’s subsidies and compensations, which have risen by 16.4% from IDR123tn in 2022 to IDR143tn in 2023. However, these incremental increases could halt in 2025. Discussions at the Ministry of Finance are underway to reduce PLN’s subsidies and compensations under the new administration's programs and policies.
An imminent solution for PLN's financial independence is required. PLN's fiscal potential can be unlocked with minimal GOI assistance by improving efficiency, particularly by reducing operating costs through the adoption of renewables.
Reducing cost and volatility via renewables
The Basic Cost of Providing Electricity (BPP) is arguably the main factor determining electricity costs, which are then translated into tariffs paid by customers. Any increase in BPP adds to the GOI’s financial burden.
Since 2020, coal and gas purchase costs have increased significantly. In 2023, purchased electricity from coal and gas contributed to a 14% increase in operational expenses and accounted for 63% of total operating costs. On average, PLN spent around US$4-5 cents per kilowatt hour (¢/kWh) for coal purchases, almost 40% higher than in 2020.
Additionally, PLN’s exposure to US$-denominated coal prices requires reconsideration. Despite the GOI's coal price cap, PLN has struggled with coal price fluctuations due to exchange rate changes. While purchases are denominated in US$, PLN’s tariff collections are in Indonesian rupiahs.
Apart from the base fuel purchasing costs, PLN also had to factor in shipping and plant maintenance costs. As coal-fired power plants age, they lose efficiency and require more coal to produce each kilowatt hour (kWh) of electricity.
Considering the difficulty in reducing purchased electricity costs and renegotiating power purchase agreements with independent power producers, PLN should accelerate the transition from fossil fuel-based energy to avoid price volatility.
Renewable energy sources are low-cost to operate compared to fossil fuel power plants. Furthermore, IEEFA’s recent report has shown that the levelized cost of electricity is around US$4.78¢/kWh for solar and US$4.77¢/kWh for wind. In comparison, coal costs around US$6.5¢/kWh, which is at least US$1.7¢/kWh more.
Solar and wind are now the lowest-cost energy sources globally and are expected to become even cheaper by 2030. Notably, maintaining coal-fired power plants is more expensive than constructing entirely new, rapidly built renewable energy plants.
Consequently, the gradual retirement of coal-fired power plants and a concerted transition to renewable energy sources will be a win-win solution for Indonesia to fulfill its Paris Agreement commitments and financial goals.
Mutya Yustika, IEEFA
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Monday, 12 February 24
US THERMAL COAL EXPORTS HIT 5-YEAR HIGHS AND TOP $5 BLN IN 2023 - REUTERS
United States exporters of thermal coal earned more than $5 billion in 2023 as they shipped out more than 32.5 million metric tons of the high-poll ...
Tuesday, 06 February 24
NEW E-FUELS PROJECT TO MAKE INTERNATIONAL SHIPPING CLIMATE-NEUTRAL - RINA
Transport and trade on the ocean blue must be made much greener. This is the goal of the new €17 million European GAMMA project, where compani ...
Tuesday, 06 February 24
INDIA SEES ANNUAL COAL OUTPUT UP 10.9% IN 2024/25 - REUTERS
India expects domestic coal output to increase by 10.9% to 1.13 billion metric tons in the fiscal year ending March 2025, a senior government offic ...
Tuesday, 06 February 24
INDIA'S COAL PRODUCTION INCREASES BY 10.3% TO 99.73 MILLION TONNE IN JANUARY - PTI
The country’s coal output rose 10.3 per cent to 99.73 Million Tonne (MT) in January, over the same month in the previous fiscal.
...
Friday, 02 February 24
DRY BULK MARKET: THE DOWNWARD REVISION IN THE GROWTH OF CAPESIZE TONNE DAYS IN JANUARY WITH THE BCI DROPPING - MARIA BERTZELETOU
In the last week of January, the dry freight market sustained weakness in the Capesize segment, while the number of ballasters in the Southeast (SE ...
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Showing 36 to 40 news of total 6871 |
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- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kartika Selabumi Mining - Indonesia
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- GVK Power & Infra Limited - India
- Globalindo Alam Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Altura Mining Limited, Indonesia
- Kepco SPC Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Ministry of Mines - Canada
- The University of Queensland
- Billiton Holdings Pty Ltd - Australia
- ICICI Bank Limited - India
- Vizag Seaport Private Limited - India
- Parry Sugars Refinery, India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Star Paper Mills Limited - India
- Bharathi Cement Corporation - India
- Jaiprakash Power Ventures ltd
- Borneo Indobara - Indonesia
- IEA Clean Coal Centre - UK
- Therma Luzon, Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Siam City Cement - Thailand
- Sojitz Corporation - Japan
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Cement Manufacturers Association - India
- Bhatia International Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Wood Mackenzie - Singapore
- Miang Besar Coal Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Savvy Resources Ltd - HongKong
- Bukit Baiduri Energy - Indonesia
- Agrawal Coal Company - India
- Jindal Steel & Power Ltd - India
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Parliament of New Zealand
- Iligan Light & Power Inc, Philippines
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- Anglo American - United Kingdom
- The Treasury - Australian Government
- Directorate General of MIneral and Coal - Indonesia
- London Commodity Brokers - England
- Orica Mining Services - Indonesia
- Indonesian Coal Mining Association
- Edison Trading Spa - Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Energy Exchange, India
- PNOC Exploration Corporation - Philippines
- Tamil Nadu electricity Board
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Xindia Steels Limited - India
- Meralco Power Generation, Philippines
- Simpson Spence & Young - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- Global Coal Blending Company Limited - Australia
- PTC India Limited - India
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Indika Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Business Power Corporation, Philippines
- Deloitte Consulting - India
- Formosa Plastics Group - Taiwan
- Ambuja Cements Ltd - India
- Gujarat Sidhee Cement - India
- SMG Consultants - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Banpu Public Company Limited - Thailand
- Salva Resources Pvt Ltd - India
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- Bulk Trading Sa - Switzerland
- Georgia Ports Authority, United States
- Mjunction Services Limited - India
- Posco Energy - South Korea
- Mintek Dendrill Indonesia
- CNBM International Corporation - China
- VISA Power Limited - India
- Vedanta Resources Plc - India
- Rio Tinto Coal - Australia
- San Jose City I Power Corp, Philippines
- The State Trading Corporation of India Ltd
- Gujarat Mineral Development Corp Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Standard Chartered Bank - UAE
- Maharashtra Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Ministry of Finance - Indonesia
- Central Electricity Authority - India
- Indogreen Group - Indonesia
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- Coal and Oil Company - UAE
- CIMB Investment Bank - Malaysia
- GAC Shipping (India) Pvt Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Uttam Galva Steels Limited - India
- Electricity Authority, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asmin Koalindo Tuhup - Indonesia
- White Energy Company Limited
- Directorate Of Revenue Intelligence - India
- Siam City Cement PLC, Thailand
- Bangladesh Power Developement Board
- McConnell Dowell - Australia
- Attock Cement Pakistan Limited
- Mercuria Energy - Indonesia
- Tata Chemicals Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Planning Commission, India
- Aboitiz Power Corporation - Philippines
- Chamber of Mines of South Africa
- Romanian Commodities Exchange
- Kideco Jaya Agung - Indonesia
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Sarangani Energy Corporation, Philippines
- MS Steel International - UAE
- Carbofer General Trading SA - India
- Singapore Mercantile Exchange
- Lanco Infratech Ltd - India
- Karaikal Port Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Power Finance Corporation Ltd., India
- Minerals Council of Australia
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
- Dalmia Cement Bharat India
- Independent Power Producers Association of India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cigading International Bulk Terminal - Indonesia
- Makarim & Taira - Indonesia
- Ceylon Electricity Board - Sri Lanka
- New Zealand Coal & Carbon
- Manunggal Multi Energi - Indonesia
- Energy Development Corp, Philippines
- Renaissance Capital - South Africa
- Eastern Coal Council - USA
- Thai Mozambique Logistica
- Sical Logistics Limited - India
- Orica Australia Pty. Ltd.
- Ministry of Transport, Egypt
- Wilmar Investment Holdings
- Petron Corporation, Philippines
- Latin American Coal - Colombia
- Intertek Mineral Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sakthi Sugars Limited - India
- Bayan Resources Tbk. - Indonesia
- Videocon Industries ltd - India
- Energy Link Ltd, New Zealand
- Australian Coal Association
- Merrill Lynch Commodities Europe
- Semirara Mining and Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Coastal Gujarat Power Limited - India
- Essar Steel Hazira Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- SMC Global Power, Philippines
- Heidelberg Cement - Germany
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Interocean Group of Companies - India
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Thiess Contractors Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Economic Council, Georgia
- Goldman Sachs - Singapore
- Kaltim Prima Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Commonwealth Bank - Australia
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Eastern Energy - Thailand
- OPG Power Generation Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- GN Power Mariveles Coal Plant, Philippines
- PowerSource Philippines DevCo
- Trasteel International SA, Italy
- Leighton Contractors Pty Ltd - Australia
- Jorong Barutama Greston.PT - Indonesia
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- Sindya Power Generating Company Private Ltd
- IHS Mccloskey Coal Group - USA
- Aditya Birla Group - India
- Semirara Mining Corp, Philippines
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