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Energy minister signs decree on fixed domestic coal price
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Energy and Mineral Resources Minister Ignasius Jonan (Antara/Akbar Nugroho Gumay)
E
nergy and Mineral Resources Minister Ignasius Jonan has signed a decree on a domestic coal price fixed under the domestic market obligation (DMO), a move that is expected to ease the financial burden of state-owned electricity company PLN.
The decree has yet to be issued, however, pending the issuance of revised Government Regulation (PP) No. 1/2017 on diversified mineral resources businesses, a draft of which has been sent to the Presidential Office, he added.
“Soon after the government regulation [on the issue] is issued, the energy and mineral resources ministerial regulation [Permen ESDM] will be issued,” Jonan said in Jakarta on Tuesday as reported by kontan.co.id.
Due to PLN’s request for a fixed domestic coal price, Jonan added, the government had to revised Government Regulation PP No. 1/2017.
Jonan declined to comment on the exact price that would be decided by the government, but kontan.co.id reported that it might be 70 percent of the current market price. Other sources have cited a price of US$70 per ton.
Jonan confirmed that the government had decided not to increase electricity tariffs until the end of 2019, a decision that would burden PLN due to increasing global coal prices because coal-fired power plants account for 57 percent of Indonesia’s power generation capacity.
Meanwhile, PLN corporate planning director Syofvi Felienty Roekman said the domestic coal price was currently at $101 per ton. (bbn)
