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.
|
|
Thursday, 26 May 22
MARKET INSIGHT - INTERMODAL
The newbuilding market activity has been significantly positive from a dry bulk owner perspective during the first half of 2022. Indeed, the contra ...
Wednesday, 18 May 22
INDONESIAN COAL PRICE REFERENCE DROPPED 4.42% IN MAY
COALspot.com: Indonesian Coal Price Reference for May delivery drops 4.42 per cent month on month.
The Indonesian Coal Price Referen ...
Thursday, 12 May 22
MARKET INSIGHT - INTERMODAL
Almost through half of the year, the overall shipping market continues to show signs of healthiness, after plenty of festivities and holidays that ...
Wednesday, 27 April 22
EUROPEAN UNION'S LNG IMPORTS - BANCHERO COSTA
In 2021, the European Union (27) was the third largest seaborne importer of LNG in the world, with a 15.8% share.
It followed Mainla ...
Tuesday, 26 April 22
CHINA'S APPETITE FOR BAUXITE HITS NEW RECORD AS Q1 IMPORTS JUMP 15.4% Y/Y - BIMCO
Bauxite shipments arriving in China hit new record levels in the first quarter of 2022 and grew at an average annual rate of 12.8% between 2017 and ...
|
|
|
Showing 321 to 325 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Malabar Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Binh Thuan Hamico - Vietnam
- Intertek Mineral Services - Indonesia
- London Commodity Brokers - England
- Metalloyd Limited - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Electricity Authority, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Java Power - Indonesia
- Therma Luzon, Inc, Philippines
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indogreen Group - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Miang Besar Coal Terminal - Indonesia
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- PowerSource Philippines DevCo
- Samtan Co., Ltd - South Korea
- Medco Energi Mining Internasional
- VISA Power Limited - India
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Savvy Resources Ltd - HongKong
- SMC Global Power, Philippines
- McConnell Dowell - Australia
- Kideco Jaya Agung - Indonesia
- The University of Queensland
- Lanco Infratech Ltd - India
- Jaiprakash Power Ventures ltd
- Thiess Contractors Indonesia
- GAC Shipping (India) Pvt Ltd
- Kohat Cement Company Ltd. - Pakistan
- Sindya Power Generating Company Private Ltd
- Kobexindo Tractors - Indoneisa
- Bharathi Cement Corporation - India
- ICICI Bank Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Siam City Cement - Thailand
- Timah Investasi Mineral - Indoneisa
- Pendopo Energi Batubara - Indonesia
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Price Waterhouse Coopers - Russia
- Pipit Mutiara Jaya. PT, Indonesia
- Chamber of Mines of South Africa
- The Treasury - Australian Government
- Aditya Birla Group - India
- Bahari Cakrawala Sebuku - Indonesia
- Coal and Oil Company - UAE
- San Jose City I Power Corp, Philippines
- Riau Bara Harum - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Asmin Koalindo Tuhup - Indonesia
- Mercator Lines Limited - India
- Ambuja Cements Ltd - India
- White Energy Company Limited
- Bukit Baiduri Energy - Indonesia
- Mercuria Energy - Indonesia
- CNBM International Corporation - China
- GMR Energy Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indonesian Coal Mining Association
- Standard Chartered Bank - UAE
- Ministry of Finance - Indonesia
- SN Aboitiz Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Tata Chemicals Ltd - India
- Singapore Mercantile Exchange
- Baramulti Group, Indonesia
- Antam Resourcindo - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Karaikal Port Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Carbofer General Trading SA - India
- Straits Asia Resources Limited - Singapore
- Interocean Group of Companies - India
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Eastern Energy - Thailand
- Salva Resources Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Sarangani Energy Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bhatia International Limited - India
- Altura Mining Limited, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Energy Development Corp, Philippines
- Bulk Trading Sa - Switzerland
- Attock Cement Pakistan Limited
- Borneo Indobara - Indonesia
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- Edison Trading Spa - Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- Posco Energy - South Korea
- Parliament of New Zealand
- The State Trading Corporation of India Ltd
- Marubeni Corporation - India
- Port Waratah Coal Services - Australia
- Energy Link Ltd, New Zealand
- Australian Commodity Traders Exchange
- Deloitte Consulting - India
- Sical Logistics Limited - India
- Thai Mozambique Logistica
- Renaissance Capital - South Africa
- Australian Coal Association
- International Coal Ventures Pvt Ltd - India
- Xindia Steels Limited - India
- GVK Power & Infra Limited - India
- Indian Oil Corporation Limited
- Georgia Ports Authority, United States
- Ministry of Transport, Egypt
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Vizag Seaport Private Limited - India
- Latin American Coal - Colombia
- Kartika Selabumi Mining - Indonesia
- India Bulls Power Limited - India
- Directorate Of Revenue Intelligence - India
- Trasteel International SA, Italy
- Oldendorff Carriers - Singapore
- Globalindo Alam Lestari - Indonesia
- Barasentosa Lestari - Indonesia
- Independent Power Producers Association of India
- Planning Commission, India
- Sakthi Sugars Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mjunction Services Limited - India
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Sojitz Corporation - Japan
- Coalindo Energy - Indonesia
- Madhucon Powers Ltd - India
- Power Finance Corporation Ltd., India
- Videocon Industries ltd - India
- Iligan Light & Power Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- European Bulk Services B.V. - Netherlands
- CIMB Investment Bank - Malaysia
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Economic Council, Georgia
- Kaltim Prima Coal - Indonesia
- MS Steel International - UAE
- Kumho Petrochemical, South Korea
- Alfred C Toepfer International GmbH - Germany
- Uttam Galva Steels Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Aboitiz Power Corporation - Philippines
- Vedanta Resources Plc - India
- PTC India Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Heidelberg Cement - Germany
- Meenaskhi Energy Private Limited - India
- Jindal Steel & Power Ltd - India
- Bhushan Steel Limited - India
- Formosa Plastics Group - Taiwan
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Goldman Sachs - Singapore
- Sinarmas Energy and Mining - Indonesia
- Bhoruka Overseas - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Cement Manufacturers Association - India
- Ceylon Electricity Board - Sri Lanka
- TeaM Sual Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Parry Sugars Refinery, India
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- Bukit Makmur.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Banpu Public Company Limited - Thailand
- Minerals Council of Australia
- New Zealand Coal & Carbon
- IHS Mccloskey Coal Group - USA
- Anglo American - United Kingdom
- Star Paper Mills Limited - India
- Essar Steel Hazira Ltd - India
- Maheswari Brothers Coal Limited - India
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining Corp, Philippines
- South Luzon Thermal Energy Corporation
- Semirara Mining and Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Romanian Commodities Exchange
- Rio Tinto Coal - Australia
- Meralco Power Generation, Philippines
|
| |
| |
|
