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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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Friday, 02 February 24
COAL INDIA ACHIEVES NEARLY 80% OF ITS FY24 PRODUCTION TARGET IN TEN MONTHS - CNBCTV18
For the month of January, the company’s production grew by 9.1% from the same period last year to 78.4 Million Tonnes (MT), from 71.9 MT last ...
Thursday, 01 February 24
CHINA'S WIND, SOLAR CAPACITY TO OVERTAKE COAL IN 2024 - INDUSTRY BODY, REUTERS REPORTED
China’s installed wind and solar capacity is expected to overtake coal for the first time this year, according to industry forecasts.
&nb ...
Thursday, 01 February 24
ANTI-DEDUCTION CLAUSES: CAN A CHARTERER WITHHOLD HIRE WITHOUT AN OWNER'S CONSENT? - SKULD
KNOWLEDGE TO ELEVATE
Summary
In The Anna Dorothea, the Court found that where a charterparty provides that no deduction from hire may be m ...
Thursday, 01 February 24
INDIA REBUILDS COAL STOCKS TO ENSURE ELECTRIC RELIABILITY - REUTERS
India’s electricity supply is much more comfortable at the start of 2024 than in either 2023 or 2022 as coal production has ramped up and the ...
Wednesday, 31 January 24
CHINA'S INNER MONGOLIA COAL OUTPUT HIT 1.21B TONS IN 2023 - XINHUA
North China’s Inner Mongolia autonomous region churned out 1.21 billion tons of coal in 2023 as it strives to guarantee the country’s e ...
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Showing 41 to 45 news of total 6871 |
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- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Gujarat Sidhee Cement - India
- Parliament of New Zealand
- Global Green Power PLC Corporation, Philippines
- Mercuria Energy - Indonesia
- Edison Trading Spa - Italy
- Simpson Spence & Young - Indonesia
- Port Waratah Coal Services - Australia
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Singapore Mercantile Exchange
- Medco Energi Mining Internasional
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- Directorate General of MIneral and Coal - Indonesia
- Vedanta Resources Plc - India
- Antam Resourcindo - Indonesia
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- White Energy Company Limited
- Energy Link Ltd, New Zealand
- Formosa Plastics Group - Taiwan
- Ind-Barath Power Infra Limited - India
- Directorate Of Revenue Intelligence - India
- Samtan Co., Ltd - South Korea
- Coastal Gujarat Power Limited - India
- Attock Cement Pakistan Limited
- Goldman Sachs - Singapore
- Heidelberg Cement - Germany
- Bukit Makmur.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- Jindal Steel & Power Ltd - India
- Sical Logistics Limited - India
- Ministry of Finance - Indonesia
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- London Commodity Brokers - England
- Mintek Dendrill Indonesia
- GMR Energy Limited - India
- Marubeni Corporation - India
- LBH Netherlands Bv - Netherlands
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- Mjunction Services Limited - India
- Latin American Coal - Colombia
- Ministry of Transport, Egypt
- McConnell Dowell - Australia
- Wood Mackenzie - Singapore
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- Coal and Oil Company - UAE
- Kartika Selabumi Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Meenaskhi Energy Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PetroVietnam Power Coal Import and Supply Company
- Ambuja Cements Ltd - India
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Global Coal Blending Company Limited - Australia
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Larsen & Toubro Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Binh Thuan Hamico - Vietnam
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Agrawal Coal Company - India
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Minerals Council of Australia
- IEA Clean Coal Centre - UK
- The University of Queensland
- Bhushan Steel Limited - India
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- VISA Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Global Business Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Interocean Group of Companies - India
- The State Trading Corporation of India Ltd
- Karbindo Abesyapradhi - Indoneisa
- PowerSource Philippines DevCo
- Sree Jayajothi Cements Limited - India
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Kaltim Prima Coal - Indonesia
- Central Java Power - Indonesia
- MS Steel International - UAE
- Semirara Mining Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- South Luzon Thermal Energy Corporation
- Planning Commission, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Economic Council, Georgia
- Chettinad Cement Corporation Ltd - India
- Straits Asia Resources Limited - Singapore
- Coalindo Energy - Indonesia
- Siam City Cement - Thailand
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- CIMB Investment Bank - Malaysia
- IHS Mccloskey Coal Group - USA
- Pendopo Energi Batubara - Indonesia
- Banpu Public Company Limited - Thailand
- Indonesian Coal Mining Association
- Electricity Authority, New Zealand
- Salva Resources Pvt Ltd - India
- Madhucon Powers Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Kideco Jaya Agung - Indonesia
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Chamber of Mines of South Africa
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- India Bulls Power Limited - India
- Sakthi Sugars Limited - India
- Meralco Power Generation, Philippines
- Parry Sugars Refinery, India
- Cement Manufacturers Association - India
- Videocon Industries ltd - India
- Gujarat Electricity Regulatory Commission - India
- Renaissance Capital - South Africa
- Indogreen Group - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- GVK Power & Infra Limited - India
- Dalmia Cement Bharat India
- Bukit Asam (Persero) Tbk - Indonesia
- Bhatia International Limited - India
- Lanco Infratech Ltd - India
- Carbofer General Trading SA - India
- SMG Consultants - Indonesia
- Eastern Energy - Thailand
- Siam City Cement PLC, Thailand
- Vizag Seaport Private Limited - India
- Bangladesh Power Developement Board
- Sojitz Corporation - Japan
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Essar Steel Hazira Ltd - India
- OPG Power Generation Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Indian Oil Corporation Limited
- Australian Commodity Traders Exchange
- Kobexindo Tractors - Indoneisa
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- New Zealand Coal & Carbon
- Australian Coal Association
- Independent Power Producers Association of India
- SN Aboitiz Power Inc, Philippines
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- Romanian Commodities Exchange
- Baramulti Group, Indonesia
- Wilmar Investment Holdings
- Asmin Koalindo Tuhup - Indonesia
- Borneo Indobara - Indonesia
- Star Paper Mills Limited - India
- Iligan Light & Power Inc, Philippines
- Posco Energy - South Korea
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- Alfred C Toepfer International GmbH - Germany
- Trasteel International SA, Italy
- Leighton Contractors Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- Kepco SPC Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- Tata Chemicals Ltd - India
- Indika Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Thai Mozambique Logistica
- Kalimantan Lumbung Energi - Indonesia
- Sarangani Energy Corporation, Philippines
- Central Electricity Authority - India
- TNB Fuel Sdn Bhd - Malaysia
- Toyota Tsusho Corporation, Japan
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