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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, 17 September 18
SMALL PERCENTAGE OF THE WORLD FLEET WILL FIT SCRUBBERS - FORECASTS : METTE KRONHOLM FRAENDE
In recent months, there have been numerous reports of a strong pick-up in demand for scrubbers. On 1 January 2020, however, the number of ships fit ...
Saturday, 15 September 18
POWERING SUSTAINABLE DEVELOPMENT WITH LOW EMISSION COAL TECHNOLOGIES - WCA
In its 5th Strategic Energy Plan this year (2018), the Japanese Cabinet recognised coal as an important energy resource, necessary for the country& ...
Friday, 14 September 18
10 YEARS ON FROM LEHMAN, HOW IS SHIPPING'S "HANGOVER"? - CLARKSONS RESEARCH
On 15th September 2008, the collapse of Lehman Brothers crystallised the financial crisis and the onset the worst economic downturn for a century. ...
Thursday, 13 September 18
OPEC SEES SLOWER 2019 OIL DEMAND GROWTH, WARNS ON ECONOMY
Crude Oil Price Movements
In August, the OPEC Reference Basket declined by $1.01 m-o-m, settling at $72.26/b. Crude oil futures were also down ...
Thursday, 13 September 18
SUPRAMAX: INDO-INDIA COAL RUN WAS FIXED CLOSE TO $16000 ON ULTRA - FEARNLEYS
Capesize
Rates took a further drop in the beginning of the week, to later find a floor around mid-week reaching mid USD 7 level for c5 and just ...
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Showing 1616 to 1620 news of total 6871 |
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- Global Coal Blending Company Limited - Australia
- Timah Investasi Mineral - Indoneisa
- Ambuja Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Dalmia Cement Bharat India
- Malabar Cements Ltd - India
- Aditya Birla Group - India
- PNOC Exploration Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meenaskhi Energy Private Limited - India
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- Samtan Co., Ltd - South Korea
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- Energy Development Corp, Philippines
- Price Waterhouse Coopers - Russia
- Coal and Oil Company - UAE
- Asmin Koalindo Tuhup - Indonesia
- Mintek Dendrill Indonesia
- Metalloyd Limited - United Kingdom
- Indika Energy - Indonesia
- SMG Consultants - Indonesia
- Indonesian Coal Mining Association
- White Energy Company Limited
- Antam Resourcindo - Indonesia
- Simpson Spence & Young - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- Power Finance Corporation Ltd., India
- Deloitte Consulting - India
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Orica Australia Pty. Ltd.
- European Bulk Services B.V. - Netherlands
- Banpu Public Company Limited - Thailand
- Uttam Galva Steels Limited - India
- Gujarat Sidhee Cement - India
- Borneo Indobara - Indonesia
- Jaiprakash Power Ventures ltd
- Sojitz Corporation - Japan
- Indogreen Group - Indonesia
- Indo Tambangraya Megah - Indonesia
- Eastern Coal Council - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMC Global Power, Philippines
- Medco Energi Mining Internasional
- Marubeni Corporation - India
- Chettinad Cement Corporation Ltd - India
- Semirara Mining Corp, Philippines
- London Commodity Brokers - England
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- Central Java Power - Indonesia
- Energy Link Ltd, New Zealand
- Bulk Trading Sa - Switzerland
- Videocon Industries ltd - India
- Wilmar Investment Holdings
- Global Green Power PLC Corporation, Philippines
- Ministry of Transport, Egypt
- Barasentosa Lestari - Indonesia
- Vizag Seaport Private Limited - India
- Merrill Lynch Commodities Europe
- Indian Energy Exchange, India
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Essar Steel Hazira Ltd - India
- Central Electricity Authority - India
- Latin American Coal - Colombia
- Therma Luzon, Inc, Philippines
- Ministry of Finance - Indonesia
- Straits Asia Resources Limited - Singapore
- Sakthi Sugars Limited - India
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Heidelberg Cement - Germany
- Billiton Holdings Pty Ltd - Australia
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Trasteel International SA, Italy
- Petron Corporation, Philippines
- VISA Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Global Business Power Corporation, Philippines
- Tamil Nadu electricity Board
- GMR Energy Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Formosa Plastics Group - Taiwan
- Australian Commodity Traders Exchange
- Globalindo Alam Lestari - Indonesia
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- TeaM Sual Corporation - Philippines
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Lanco Infratech Ltd - India
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- Sindya Power Generating Company Private Ltd
- Parry Sugars Refinery, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sical Logistics Limited - India
- Standard Chartered Bank - UAE
- Grasim Industreis Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Planning Commission, India
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Bukit Makmur.PT - Indonesia
- Madhucon Powers Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Attock Cement Pakistan Limited
- Australian Coal Association
- Bhatia International Limited - India
- Siam City Cement PLC, Thailand
- Xindia Steels Limited - India
- Chamber of Mines of South Africa
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- McConnell Dowell - Australia
- SN Aboitiz Power Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- OPG Power Generation Pvt Ltd - India
- Minerals Council of Australia
- The Treasury - Australian Government
- Oldendorff Carriers - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- PetroVietnam Power Coal Import and Supply Company
- CIMB Investment Bank - Malaysia
- Manunggal Multi Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Holcim Trading Pte Ltd - Singapore
- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Toyota Tsusho Corporation, Japan
- Anglo American - United Kingdom
- Tata Chemicals Ltd - India
- Economic Council, Georgia
- Coastal Gujarat Power Limited - India
- Posco Energy - South Korea
- Electricity Authority, New Zealand
- PTC India Limited - India
- Renaissance Capital - South Africa
- Thai Mozambique Logistica
- Ceylon Electricity Board - Sri Lanka
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Parliament of New Zealand
- Romanian Commodities Exchange
- Gujarat Electricity Regulatory Commission - India
- CNBM International Corporation - China
- Wood Mackenzie - Singapore
- Maharashtra Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Altura Mining Limited, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- ICICI Bank Limited - India
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Cement Manufacturers Association - India
- Rashtriya Ispat Nigam Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- Cigading International Bulk Terminal - Indonesia
- South Luzon Thermal Energy Corporation
- Alfred C Toepfer International GmbH - Germany
- Kartika Selabumi Mining - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Eastern Energy - Thailand
- Agrawal Coal Company - India
- Rio Tinto Coal - Australia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Intertek Mineral Services - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vedanta Resources Plc - India
- The State Trading Corporation of India Ltd
- Directorate General of MIneral and Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Ind-Barath Power Infra Limited - India
- Binh Thuan Hamico - Vietnam
- Kumho Petrochemical, South Korea
- Bukit Baiduri Energy - Indonesia
- Mjunction Services Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Star Paper Mills Limited - India
- Directorate Of Revenue Intelligence - India
- Sree Jayajothi Cements Limited - India
- PowerSource Philippines DevCo
- Interocean Group of Companies - India
- IEA Clean Coal Centre - UK
- Riau Bara Harum - Indonesia
- IHS Mccloskey Coal Group - USA
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
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