We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
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
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 23 September 22
EUROPEAN STEEL BUYERS SEEK DIRECTION IN VOLATILE MARKET - MEPS INTERNATIONAL
Demand for steel is slow to recover, after the summer break. Mill production costs continue to increase. Steel purchasers are uncertain about the f ...
Friday, 23 September 22
BUOYANT COAL INDUSTRY SEEKS WAYS TO STAY IN THE LONG-TERM ENERGY MIX - REUTERS
There’s no doubt that the global coal industry has been a major beneficiary of Russia’s invasion of Ukraine and the subsequent energy c ...
Friday, 23 September 22
MARKET INSIGHT - INTERMODAL
In view of the forthcoming winter, Europe is trying to escape from its energy (oil & gas) dependency from Russia to ensure energy abundance eve ...
Tuesday, 20 September 22
CHINA'S DAILY COAL OUTPUT HITS 3-MONTH LOW IN AUGUST ON RAINS, COVID CURBS - REUTERS
China’s daily coal output in August slipped to a three-month low as some mines in its biggest coal mining regions reduced operations or even ...
Tuesday, 20 September 22
CHINA COAL OUTPUT UP 8.1 PCT IN AUGUST - XINHUA
China’s raw coal output posted stable expansion in August, official data showed.
The country produced 370 million tonnes of ra ...
|
|
|
Showing 226 to 230 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Eastern Energy - Thailand
- Mjunction Services Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Central Electricity Authority - India
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Banpu Public Company Limited - Thailand
- Australian Commodity Traders Exchange
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Essar Steel Hazira Ltd - India
- Manunggal Multi Energi - Indonesia
- Pendopo Energi Batubara - Indonesia
- Electricity Authority, New Zealand
- Barasentosa Lestari - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Finance - Indonesia
- MS Steel International - UAE
- Maharashtra Electricity Regulatory Commission - India
- Wood Mackenzie - Singapore
- Standard Chartered Bank - UAE
- Maheswari Brothers Coal Limited - India
- Holcim Trading Pte Ltd - Singapore
- Mercuria Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- PowerSource Philippines DevCo
- Parry Sugars Refinery, India
- Indo Tambangraya Megah - Indonesia
- Savvy Resources Ltd - HongKong
- VISA Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Aditya Birla Group - India
- GVK Power & Infra Limited - India
- International Coal Ventures Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Malabar Cements Ltd - India
- Agrawal Coal Company - India
- Kobexindo Tractors - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Medco Energi Mining Internasional
- Renaissance Capital - South Africa
- Uttam Galva Steels Limited - India
- Cigading International Bulk Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meenaskhi Energy Private Limited - India
- Sical Logistics Limited - India
- Independent Power Producers Association of India
- CNBM International Corporation - China
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ambuja Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kalimantan Lumbung Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- IEA Clean Coal Centre - UK
- GAC Shipping (India) Pvt Ltd
- Ministry of Transport, Egypt
- Sindya Power Generating Company Private Ltd
- Aboitiz Power Corporation - Philippines
- Tata Chemicals Ltd - India
- CIMB Investment Bank - Malaysia
- Makarim & Taira - Indonesia
- Salva Resources Pvt Ltd - India
- London Commodity Brokers - England
- The Treasury - Australian Government
- Kideco Jaya Agung - Indonesia
- Simpson Spence & Young - Indonesia
- Larsen & Toubro Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Dalmia Cement Bharat India
- Global Business Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Power Finance Corporation Ltd., India
- Kaltim Prima Coal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bulk Trading Sa - Switzerland
- Anglo American - United Kingdom
- Borneo Indobara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vedanta Resources Plc - India
- Sakthi Sugars Limited - India
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Semirara Mining Corp, Philippines
- IHS Mccloskey Coal Group - USA
- Heidelberg Cement - Germany
- Intertek Mineral Services - Indonesia
- Singapore Mercantile Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Ministry of Mines - Canada
- The State Trading Corporation of India Ltd
- The University of Queensland
- Sree Jayajothi Cements Limited - India
- Commonwealth Bank - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Madhucon Powers Ltd - India
- Oldendorff Carriers - Singapore
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Trasteel International SA, Italy
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- Latin American Coal - Colombia
- Grasim Industreis Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement PLC, Thailand
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- Central Java Power - Indonesia
- Ind-Barath Power Infra Limited - India
- India Bulls Power Limited - India
- Economic Council, Georgia
- Therma Luzon, Inc, Philippines
- Wilmar Investment Holdings
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Metalloyd Limited - United Kingdom
- ICICI Bank Limited - India
- Parliament of New Zealand
- Australian Coal Association
- Coastal Gujarat Power Limited - India
- Georgia Ports Authority, United States
- Edison Trading Spa - Italy
- Indogreen Group - Indonesia
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Orica Mining Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Bhoruka Overseas - Indonesia
- European Bulk Services B.V. - Netherlands
- SMC Global Power, Philippines
- Attock Cement Pakistan Limited
- Straits Asia Resources Limited - Singapore
- Formosa Plastics Group - Taiwan
- Cement Manufacturers Association - India
- LBH Netherlands Bv - Netherlands
- Energy Development Corp, Philippines
- South Luzon Thermal Energy Corporation
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- PNOC Exploration Corporation - Philippines
- Indian Oil Corporation Limited
- Merrill Lynch Commodities Europe
- Baramulti Group, Indonesia
- Thai Mozambique Logistica
- GN Power Mariveles Coal Plant, Philippines
- Romanian Commodities Exchange
- Meralco Power Generation, Philippines
- Jaiprakash Power Ventures ltd
- Globalindo Alam Lestari - Indonesia
- ASAPP Information Group - India
- Marubeni Corporation - India
- Eastern Coal Council - USA
- Karbindo Abesyapradhi - Indoneisa
- Star Paper Mills Limited - India
- Ceylon Electricity Board - Sri Lanka
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Chamber of Mines of South Africa
- Deloitte Consulting - India
- McConnell Dowell - Australia
- Asmin Koalindo Tuhup - Indonesia
- Planning Commission, India
- Indonesian Coal Mining Association
- Billiton Holdings Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Interocean Group of Companies - India
- Goldman Sachs - Singapore
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- Bangladesh Power Developement Board
- Bank of Tokyo Mitsubishi UFJ Ltd
- AsiaOL BioFuels Corp., Philippines
- Petron Corporation, Philippines
- SMG Consultants - Indonesia
- Kumho Petrochemical, South Korea
- Riau Bara Harum - Indonesia
- Chettinad Cement Corporation Ltd - India
- Siam City Cement - Thailand
- White Energy Company Limited
- Indian Energy Exchange, India
- San Jose City I Power Corp, Philippines
- Binh Thuan Hamico - Vietnam
- Bharathi Cement Corporation - India
- Samtan Co., Ltd - South Korea
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Semirara Mining and Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Vizag Seaport Private Limited - India
- Karaikal Port Pvt Ltd - India
- Rio Tinto Coal - Australia
- PTC India Limited - India
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- Kapuas Tunggal Persada - Indonesia
- SN Aboitiz Power Inc, Philippines
|
| |
| |
|
