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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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Wednesday, 26 February 20
AS ALL OF THE GLOBAL COAL GIANTS EXIT SOUTH AFRICA, ESKOM TO DEPEND ON TWO MINERS FOR 70% OF ITS SUPPLY - BUSINESS INSIDER
While some of its politicians continue to imagine that coal has a future in South Africa, two key developments from the real world show that securi ...
Tuesday, 25 February 20
DELTA DUNIA MAKMUR REGISTERED A NET PROFIT OF US$20 MILLION FOR FY 2019
PT Delta Dunia Makmur, one of the largest coal mining company in Indonesia, has recorded an US$882 million revenue for FY 2019, 1% lower compared t ...
Tuesday, 25 February 20
SHIPPING UPDATE - ALLIED
The positive feeling and optimism for a fresh rally during the first few months of 2020 that prevailed in the tanker markets during the final quart ...
Monday, 24 February 20
COULD SOME VLSFO FUELS BE BANNED? - GIBSON
The run up to the implementation of the new IMO rules on marine fuels from1st January 2020 had owners and charterers analysing the vari ...
Monday, 24 February 20
CHINA SAYS MAJOR COAL FIRMS RESTORE 95% OF PRODUCTION CAPACITY - REUTERS
China’s coal companies controlled by the central government have resumed operations and are back at more than 95% of their capacity, an offic ...
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Showing 1106 to 1110 news of total 6871 |
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- Bharathi Cement Corporation - India
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Siam City Cement - Thailand
- Ceylon Electricity Board - Sri Lanka
- Coal and Oil Company - UAE
- Globalindo Alam Lestari - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Asmin Koalindo Tuhup - Indonesia
- Riau Bara Harum - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Makarim & Taira - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Cement Manufacturers Association - India
- New Zealand Coal & Carbon
- Chamber of Mines of South Africa
- Parliament of New Zealand
- Electricity Authority, New Zealand
- Edison Trading Spa - Italy
- IEA Clean Coal Centre - UK
- TeaM Sual Corporation - Philippines
- Tata Chemicals Ltd - India
- The State Trading Corporation of India Ltd
- Bangladesh Power Developement Board
- GAC Shipping (India) Pvt Ltd
- Kapuas Tunggal Persada - Indonesia
- Attock Cement Pakistan Limited
- San Jose City I Power Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Ministry of Transport, Egypt
- Manunggal Multi Energi - Indonesia
- Chettinad Cement Corporation Ltd - India
- Simpson Spence & Young - Indonesia
- Borneo Indobara - Indonesia
- Dalmia Cement Bharat India
- Sarangani Energy Corporation, Philippines
- Siam City Cement PLC, Thailand
- Baramulti Group, Indonesia
- Indogreen Group - Indonesia
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Madhucon Powers Ltd - India
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Latin American Coal - Colombia
- South Luzon Thermal Energy Corporation
- Sical Logistics Limited - India
- Jaiprakash Power Ventures ltd
- OPG Power Generation Pvt Ltd - India
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- Salva Resources Pvt Ltd - India
- Thiess Contractors Indonesia
- Maheswari Brothers Coal Limited - India
- European Bulk Services B.V. - Netherlands
- Lanco Infratech Ltd - India
- The Treasury - Australian Government
- Wood Mackenzie - Singapore
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Mercuria Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Oldendorff Carriers - Singapore
- Larsen & Toubro Limited - India
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Agrawal Coal Company - India
- Singapore Mercantile Exchange
- VISA Power Limited - India
- Eastern Coal Council - USA
- ICICI Bank Limited - India
- Meenaskhi Energy Private Limited - India
- Videocon Industries ltd - India
- Orica Australia Pty. Ltd.
- Petron Corporation, Philippines
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Rio Tinto Coal - Australia
- Bulk Trading Sa - Switzerland
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kepco SPC Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- PTC India Limited - India
- International Coal Ventures Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- White Energy Company Limited
- GVK Power & Infra Limited - India
- Africa Commodities Group - South Africa
- Meralco Power Generation, Philippines
- PNOC Exploration Corporation - Philippines
- Australian Commodity Traders Exchange
- Coalindo Energy - Indonesia
- Commonwealth Bank - Australia
- Carbofer General Trading SA - India
- Deloitte Consulting - India
- Grasim Industreis Ltd - India
- Binh Thuan Hamico - Vietnam
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- Central Java Power - Indonesia
- Pendopo Energi Batubara - Indonesia
- Energy Development Corp, Philippines
- Altura Mining Limited, Indonesia
- Jindal Steel & Power Ltd - India
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Savvy Resources Ltd - HongKong
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Bhatia International Limited - India
- Bukit Baiduri Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Power Finance Corporation Ltd., India
- Anglo American - United Kingdom
- Formosa Plastics Group - Taiwan
- Ind-Barath Power Infra Limited - India
- Barasentosa Lestari - Indonesia
- Vizag Seaport Private Limited - India
- Georgia Ports Authority, United States
- Merrill Lynch Commodities Europe
- Orica Mining Services - Indonesia
- Kobexindo Tractors - Indoneisa
- London Commodity Brokers - England
- Malabar Cements Ltd - India
- Eastern Energy - Thailand
- McConnell Dowell - Australia
- Aditya Birla Group - India
- PowerSource Philippines DevCo
- The University of Queensland
- Pipit Mutiara Jaya. PT, Indonesia
- Interocean Group of Companies - India
- Cigading International Bulk Terminal - Indonesia
- ASAPP Information Group - India
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- Bhoruka Overseas - Indonesia
- SMC Global Power, Philippines
- Sree Jayajothi Cements Limited - India
- AsiaOL BioFuels Corp., Philippines
- LBH Netherlands Bv - Netherlands
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- Bayan Resources Tbk. - Indonesia
- Star Paper Mills Limited - India
- Economic Council, Georgia
- Australian Coal Association
- Jorong Barutama Greston.PT - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Business Power Corporation, Philippines
- Minerals Council of Australia
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Billiton Holdings Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Karaikal Port Pvt Ltd - India
- Ministry of Finance - Indonesia
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Marubeni Corporation - India
- Directorate Of Revenue Intelligence - India
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Sidhee Cement - India
- Goldman Sachs - Singapore
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- Vedanta Resources Plc - India
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- Mjunction Services Limited - India
- Planning Commission, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maharashtra Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bahari Cakrawala Sebuku - Indonesia
- Uttam Galva Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- MS Steel International - UAE
- Price Waterhouse Coopers - Russia
- Therma Luzon, Inc, Philippines
- Intertek Mineral Services - Indonesia
- Kumho Petrochemical, South Korea
- Holcim Trading Pte Ltd - Singapore
- Xindia Steels Limited - India
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Kaltim Prima Coal - Indonesia
- Sakthi Sugars Limited - India
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Iligan Light & Power Inc, Philippines
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