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PLN expects fixed DMO coal price in March
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PLN president director Sofyan Basir (Antara/Wahyu Putro A)
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tate-owned electricity firm PLN says the government has decided to set a fixed price for coal supplied to the company under the domestic market obligation (DMO), a move that is expected to ease its financial burden.
With coal-fired power plants accounting for 57 percent of Indonesia’s power generation capacity of 60,491 megawatts last year, the increase in coal prices over the past year has been problematic for PLN.
Therefore, the Energy and Mineral Resources Ministry plans to introduce a new price formula for coal supplied to PLN by domestic mining firms.
“We believe that this coal price issue has been settled. President [Joko “Jokowi” Widodo] will issue a presidential regulation that will set a fixed price for coal [supplied to us],” PLN president director Sofyan Basir said on Wednesday, adding that the regulation would be issued in March.
PLN has previously suggested that the ministry set a price floor of US$55 and a ceiling of $70 per ton for coal supplied under the DMO.
Meanwhile, the Indonesian Coal Mining Association (APBI), which represents more than 70 percent of PLN's coal suppliers in the country, has suggested that the ministry fix the coal price at $85 per ton for a certain period, such as a year or two.
The Indonesian Geological Experts Association (IAGI) has called on the government to thoroughly discuss the issue before deciding on the DMO coal price. (bbn)
