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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, 04 November 19
PANAMAX: WEAKER SENTIMENTS CONTINUED FROM LAST WEEK, WITH RATES FURTHER SOFTENING IN BOTH BASINS - BALTIC BRIEFING
Capesize
The Capesize market meandered slightly upwards this week before giving back much of its gains mid-week. Opening the week at $24,945, t ...
Thursday, 31 October 19
U.S. COAL-FIRED POWER PLANTS SCHEDULED TO SHUT - REUTERS
U.S. power companies expect to retire or convert from coal to gas over 13,800 megawatts (MW) of coal-fired plants in 2019 after shutting over 13,30 ...
Thursday, 31 October 19
SE ASIA MAY BECOME NET FOSSIL FUEL IMPORTER IN COMING YEARS - IEA
Southeast Asia is set to become a key driver of world energy trends over the next 20 years as its energy demand grows at twice the global average, ...
Monday, 28 October 19
ULTRAMAX: ASIA RATES REMAINED UNDER PRESSURE WITH THE NORTH LACKING FRESH ENQUIRY - BALTIC BRIEFING
Capesize
The end of the week brought about a small increase in sentiment heading into a long weekend for some regions. After sustaining a drop ...
Thursday, 24 October 19
AUSTRALIA'S HOPES TO EXPAND COAL EXPORTS IN SOUTH-EAST ASIA 'DELUSIONAL', EXPERTS SAY - THE GUARDIAN
The number of new coal-fired power plants starting construction across south-east Asia has fallen markedly over the past two years as Australia has ...
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Showing 1296 to 1300 news of total 6871 |
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- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bulk Trading Sa - Switzerland
- Energy Development Corp, Philippines
- Minerals Council of Australia
- Miang Besar Coal Terminal - Indonesia
- London Commodity Brokers - England
- Iligan Light & Power Inc, Philippines
- Bhoruka Overseas - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Africa Commodities Group - South Africa
- Wilmar Investment Holdings
- CIMB Investment Bank - Malaysia
- New Zealand Coal & Carbon
- The Treasury - Australian Government
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Indika Energy - Indonesia
- Singapore Mercantile Exchange
- Neyveli Lignite Corporation Ltd, - India
- Renaissance Capital - South Africa
- Bharathi Cement Corporation - India
- SN Aboitiz Power Inc, Philippines
- Carbofer General Trading SA - India
- Binh Thuan Hamico - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Deloitte Consulting - India
- Bahari Cakrawala Sebuku - Indonesia
- Planning Commission, India
- Kepco SPC Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- Uttam Galva Steels Limited - India
- Videocon Industries ltd - India
- Dalmia Cement Bharat India
- Heidelberg Cement - Germany
- Bangladesh Power Developement Board
- Meralco Power Generation, Philippines
- Straits Asia Resources Limited - Singapore
- McConnell Dowell - Australia
- Posco Energy - South Korea
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Marubeni Corporation - India
- Georgia Ports Authority, United States
- Ind-Barath Power Infra Limited - India
- India Bulls Power Limited - India
- Port Waratah Coal Services - Australia
- Sical Logistics Limited - India
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Mintek Dendrill Indonesia
- Sinarmas Energy and Mining - Indonesia
- Romanian Commodities Exchange
- Samtan Co., Ltd - South Korea
- VISA Power Limited - India
- Toyota Tsusho Corporation, Japan
- SMG Consultants - Indonesia
- Tata Chemicals Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Ministry of Finance - Indonesia
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mercator Lines Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Manunggal Multi Energi - Indonesia
- Formosa Plastics Group - Taiwan
- Maheswari Brothers Coal Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Eastern Coal Council - USA
- Ceylon Electricity Board - Sri Lanka
- Standard Chartered Bank - UAE
- Holcim Trading Pte Ltd - Singapore
- Global Business Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- Goldman Sachs - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Interocean Group of Companies - India
- Banpu Public Company Limited - Thailand
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- Bhatia International Limited - India
- Jindal Steel & Power Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- MS Steel International - UAE
- Malabar Cements Ltd - India
- Independent Power Producers Association of India
- Directorate General of MIneral and Coal - Indonesia
- Economic Council, Georgia
- Cement Manufacturers Association - India
- Baramulti Group, Indonesia
- GMR Energy Limited - India
- Rio Tinto Coal - Australia
- PowerSource Philippines DevCo
- Semirara Mining Corp, Philippines
- Vedanta Resources Plc - India
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Energy Link Ltd, New Zealand
- Salva Resources Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Electricity Authority, New Zealand
- Metalloyd Limited - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kobexindo Tractors - Indoneisa
- Attock Cement Pakistan Limited
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- CNBM International Corporation - China
- Mercuria Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- GVK Power & Infra Limited - India
- Ambuja Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Trasteel International SA, Italy
- The University of Queensland
- Gujarat Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- Semirara Mining and Power Corporation, Philippines
- Sojitz Corporation - Japan
- Power Finance Corporation Ltd., India
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Medco Energi Mining Internasional
- Madhucon Powers Ltd - India
- Makarim & Taira - Indonesia
- European Bulk Services B.V. - Netherlands
- Pendopo Energi Batubara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Xindia Steels Limited - India
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- Central Java Power - Indonesia
- Coal and Oil Company - UAE
- Savvy Resources Ltd - HongKong
- Bhushan Steel Limited - India
- Kaltim Prima Coal - Indonesia
- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- Orica Australia Pty. Ltd.
- South Luzon Thermal Energy Corporation
- PNOC Exploration Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Global Coal Blending Company Limited - Australia
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Australian Commodity Traders Exchange
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Indonesian Coal Mining Association
- Vizag Seaport Private Limited - India
- Indian Energy Exchange, India
- Anglo American - United Kingdom
- Electricity Generating Authority of Thailand
- Sakthi Sugars Limited - India
- PTC India Limited - India
- Sarangani Energy Corporation, Philippines
- Indian Oil Corporation Limited
- Antam Resourcindo - Indonesia
- Wood Mackenzie - Singapore
- Edison Trading Spa - Italy
- Thiess Contractors Indonesia
- Thai Mozambique Logistica
- Intertek Mineral Services - Indonesia
- ICICI Bank Limited - India
- Kartika Selabumi Mining - Indonesia
- Price Waterhouse Coopers - Russia
- Kideco Jaya Agung - Indonesia
- Jaiprakash Power Ventures ltd
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- Karaikal Port Pvt Ltd - India
- Tamil Nadu electricity Board
- Sindya Power Generating Company Private Ltd
- Globalindo Alam Lestari - Indonesia
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- TeaM Sual Corporation - Philippines
- The State Trading Corporation of India Ltd
- Bukit Makmur.PT - Indonesia
- Siam City Cement PLC, Thailand
- Bukit Baiduri Energy - Indonesia
- Merrill Lynch Commodities Europe
- Larsen & Toubro Limited - India
- Australian Coal Association
- Riau Bara Harum - Indonesia
- Ministry of Transport, Egypt
- Latin American Coal - Colombia
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