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Monday, 06 October 14
' COAL-BY-WIRE' FROM SUMATRA TO JAVA - THE JAKARTA POST
 Coal from the island of Sumatra accounts for most of Indonesia’s low-grade lignite, a low-quality coal that receives a poor price in international markets.
Given this low pricing combined with high transportation costs and the fact that most reserves are located in landlocked areas, it is not feasible to export Sumatra’s coal out of the island.
It is more efficient to use Sumatra’s coal for a mine-mouth power plant, an approach in which we develop a power plant very close to where mines are located, use the low-calorie coal from the mines to feed the plant, and transmit the electricity, rather than transporting a low-value commodity, out of the mines.
With mine-mouth, we no longer require either barges or expensive railway-heavy infrastructure to transport coal; rather we need to have long-distance high-voltage transmission lines to bring “coal-by-wire” from mines to consumer centers, either regions in Sumatra and/or Java-Bali.
Essentially, with “coal-by-wire” we are transporting a higher-value commodity by wire from mines to customers. Coal stays in the landlocked areas and feeds mine-mouth, coal-fired power plants.
“Coal-by-wire” would definitely boost the development of a domestic market for low-grade coal. Today, our market for coal is very thin as we are one of the world’s leading exporters of thermal coal of a high quality in the international market.
Our exports have increased very significantly within the past decade on account of demand from fast-growing Asian economies. More than 80 percent of our coal currently produced is exported.
Indeed, coal is currently the most important source of energy for our economy. For decades coal has accounted for more than half of our power-generation capacity. And this will continue for a half century to come before alternative and cleaner energy sources other than coal become affordably available.
Our economy is also growing, and of course will require more electricity power and therefore coal – challenges that have to be met. Electricity generation now consumes close to 75 million tons per year, and will almost triple in the next 10 to 15 years.
However, domestic use of coal today notoriously suffers from infrastructure bottlenecks. Congested barges and ports, as well as a shortage of railways limit the transportation of coal from coalmines in two coal-producing regions, Kalimantan and Sumatra, to demand centers in Java-Bali, where most of our power plants are located.
The majority of our coal reserves in the two regions are located in landlocked areas that require rail transportation infrastructure to reach ports for export.
Either truck haul or rail is needed to transport the coal to barge ports and terminals.
Truck operating costs are about twice that of rail, but existing rail transportation infrastructure is severely insufficient.
Indonesia’s attempts to improve coal-transport infrastructure for the domestic market have not been very successful. Dedicated coal ports in Kalimantan have been planned for many years, but implementation has again faced bottleneck issues.
Specialized railways for coal in Sumatra have also been initiated, but this concept is still under development and has not yet received a higher-level mandate or legal authorization.
Delays in expanding the capacity of barge and transportation infrastructure cause inefficiencies and high transportation costs in domestic coal utilization. These high costs and infrastructure bottlenecks have held back the development of the domestic market for coal.
Our high-voltage transmission lines are also astonishingly limited. The state-owned electricity company (PLN) operates approximately 40,000 kilometers of transmission lines, with less than 15 percent of this total serving the island of Sumatra.
If we can build more mine-mouth, coal-fired power generation plants we will need to expand our transmission network across the island, interconnected to other transmission systems in Java-Bali.
A new set of lines of a high-voltage of 500 kilovolts and medium-voltage of 275 kV needs to be developed as a backbone network across the island, i.e. providing long-distance, reliable and stable transmission.
The distribution system and transformer capacity also need to be expanded to service a larger coverage of costumers and demand centers.
We are required also to develop an interconnected transmission system, as existing electricity transmission is not compatible across regions due to different systems and manufacturer standards adopted in the past.
The current initiative of developing inter-island interconnection lines between Java and Sumatra with 500kV High Voltage Direct Current (HVDC) lines needs to be completed in harmony with the mine-mouth development.
These long-distance transmission and distribution lines, as well as interconnected systems are required to exist before a system of mine-mouth power plants is commissioned to ensure that electricity produced can be transmitted in a timely manner and with minimum cost.
Both the central and local governments must work hand-in-hand to endorse incentives to encourage the private sector — independent power producers (IPPs) — to develop mine-mouth power plants.
Incentives need to be designed to enhance the financial viability of IPPs’ mine-mouth power plant projects.
PLN as an off-taker of IPP plays a fundamental role as the “coal-by-wire” agent, and has to be ready to absorb all of the risks associated with the development and operation of the system, including the difficulties in land acquisition and intra-regional compatibility of transmission systems.
Sumatra with its huge resources of low-grade coal can secure its own electricity supply and, eventually, can be the source of low-cost electricity with its energy radiating not only to Java, but also to every corner of the country.
Source: The Jakarta Post
The writer is deputy for energy and mineral resources at the office of Coordinating Economic Minister.
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Monday, 27 October 14
CFR SOUTH CHINA COAL SWAPS PERFORMED POSITIVE THIS PAST WEEK
COALspot.com: API 8 CFR South China Coal swap for Q4’ 2014 delivery decreased US$ 1.68 (-2.55%) month over month and increased US$ 0.87 (+1.3 ...
Sunday, 26 October 14
CAPE'S STRONG PERFORMANCE PUSHES BDI INDEX UPWARDS
COALspot.com: The BDI was up by 26.27 pct and closed at 1192 points week and week. The Cape size performance has pushed up BDI and Cape size index ...
Friday, 24 October 14
WEEKLY U.S COAL PRODUCTION DOWN 2.7% FOR THE WEEK ENDING OCTOBER 18
COALspot.com – United States the world's one of largest coal producers, produced approximately 18.7 million short tons (mmst) of coal in ...
Thursday, 23 October 14
THE BEARS, HOWEVER, STILL CRY; FOR HOW LONG WILL IT LAST? - FEARNLEYS
Handy
"We experience a typical oversupply of ships in the Atlantic which causing rates to slide. In the USG it is just enough cargoes to kee ...
Wednesday, 22 October 14
MARKET INSIGHT - THEODORE NTALAKOS, INTERMODAL
ECO designs - revisited
The ECO vessels are already here but the oil and bunker prices are plummeting to their cheapest level since 2010. Is this ...
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- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- Chettinad Cement Corporation Ltd - India
- Simpson Spence & Young - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Kapuas Tunggal Persada - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Meenaskhi Energy Private Limited - India
- Baramulti Group, Indonesia
- Minerals Council of Australia
- Kepco SPC Power Corporation, Philippines
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Bharathi Cement Corporation - India
- Essar Steel Hazira Ltd - India
- GAC Shipping (India) Pvt Ltd
- Orica Australia Pty. Ltd.
- Edison Trading Spa - Italy
- Vijayanagar Sugar Pvt Ltd - India
- Carbofer General Trading SA - India
- Deloitte Consulting - India
- Indonesian Coal Mining Association
- Iligan Light & Power Inc, Philippines
- SMG Consultants - Indonesia
- Altura Mining Limited, Indonesia
- IEA Clean Coal Centre - UK
- Coal and Oil Company - UAE
- Singapore Mercantile Exchange
- Samtan Co., Ltd - South Korea
- Videocon Industries ltd - India
- Malabar Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Georgia Ports Authority, United States
- Timah Investasi Mineral - Indoneisa
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- Posco Energy - South Korea
- Indogreen Group - Indonesia
- Wilmar Investment Holdings
- Indo Tambangraya Megah - Indonesia
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- PNOC Exploration Corporation - Philippines
- Electricity Generating Authority of Thailand
- Jindal Steel & Power Ltd - India
- The State Trading Corporation of India Ltd
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
- Metalloyd Limited - United Kingdom
- Semirara Mining Corp, Philippines
- Sree Jayajothi Cements Limited - India
- The Treasury - Australian Government
- Bukit Asam (Persero) Tbk - Indonesia
- Bukit Baiduri Energy - Indonesia
- Aditya Birla Group - India
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- Manunggal Multi Energi - Indonesia
- TeaM Sual Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Heidelberg Cement - Germany
- Sarangani Energy Corporation, Philippines
- SMC Global Power, Philippines
- Bayan Resources Tbk. - Indonesia
- Petron Corporation, Philippines
- Renaissance Capital - South Africa
- Ind-Barath Power Infra Limited - India
- Oldendorff Carriers - Singapore
- SN Aboitiz Power Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Parliament of New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Economic Council, Georgia
- Barasentosa Lestari - Indonesia
- Bhatia International Limited - India
- Siam City Cement PLC, Thailand
- The University of Queensland
- Kideco Jaya Agung - Indonesia
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercator Lines Limited - India
- AsiaOL BioFuels Corp., Philippines
- Jaiprakash Power Ventures ltd
- MS Steel International - UAE
- Tata Chemicals Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- White Energy Company Limited
- Wood Mackenzie - Singapore
- Lanco Infratech Ltd - India
- Anglo American - United Kingdom
- Australian Coal Association
- Ministry of Finance - Indonesia
- Africa Commodities Group - South Africa
- Sindya Power Generating Company Private Ltd
- Central Electricity Authority - India
- Sojitz Corporation - Japan
- Madhucon Powers Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Interocean Group of Companies - India
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- European Bulk Services B.V. - Netherlands
- Ambuja Cements Ltd - India
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- Orica Mining Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Bulk Trading Sa - Switzerland
- Ministry of Transport, Egypt
- New Zealand Coal & Carbon
- Jorong Barutama Greston.PT - Indonesia
- Agrawal Coal Company - India
- Ceylon Electricity Board - Sri Lanka
- International Coal Ventures Pvt Ltd - India
- VISA Power Limited - India
- GMR Energy Limited - India
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Karbindo Abesyapradhi - Indoneisa
- Sakthi Sugars Limited - India
- Global Coal Blending Company Limited - Australia
- GN Power Mariveles Coal Plant, Philippines
- Maheswari Brothers Coal Limited - India
- Grasim Industreis Ltd - India
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- Bahari Cakrawala Sebuku - Indonesia
- Tamil Nadu electricity Board
- Binh Thuan Hamico - Vietnam
- Rio Tinto Coal - Australia
- ICICI Bank Limited - India
- GVK Power & Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- South Luzon Thermal Energy Corporation
- Central Java Power - Indonesia
- Coastal Gujarat Power Limited - India
- Vedanta Resources Plc - India
- Merrill Lynch Commodities Europe
- PTC India Limited - India
- Star Paper Mills Limited - India
- Gujarat Sidhee Cement - India
- Sinarmas Energy and Mining - Indonesia
- Xindia Steels Limited - India
- Leighton Contractors Pty Ltd - Australia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Coal Council - USA
- Kaltim Prima Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Billiton Holdings Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Salva Resources Pvt Ltd - India
- Bangladesh Power Developement Board
- Pipit Mutiara Jaya. PT, Indonesia
- Power Finance Corporation Ltd., India
- McConnell Dowell - Australia
- Uttam Galva Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Global Business Power Corporation, Philippines
- Trasteel International SA, Italy
- Australian Commodity Traders Exchange
- Makarim & Taira - Indonesia
- Aboitiz Power Corporation - Philippines
- Commonwealth Bank - Australia
- Directorate Of Revenue Intelligence - India
- Neyveli Lignite Corporation Ltd, - India
- Bhoruka Overseas - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Chamber of Mines of South Africa
- Directorate General of MIneral and Coal - Indonesia
- Planning Commission, India
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- Kalimantan Lumbung Energi - Indonesia
- Independent Power Producers Association of India
- Indika Energy - Indonesia
- Latin American Coal - Colombia
- Borneo Indobara - Indonesia
- Globalindo Alam Lestari - Indonesia
- Parry Sugars Refinery, India
- India Bulls Power Limited - India
- San Jose City I Power Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Marubeni Corporation - India
- Meralco Power Generation, Philippines
- Thai Mozambique Logistica
- Alfred C Toepfer International GmbH - Germany
- Indian Oil Corporation Limited
- Karaikal Port Pvt Ltd - India
- Coalindo Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Riau Bara Harum - Indonesia
- ASAPP Information Group - India
- Therma Luzon, Inc, Philippines
- Larsen & Toubro Limited - India
- Bhushan Steel Limited - India
- PowerSource Philippines DevCo
- Rashtriya Ispat Nigam Limited - India
- Cigading International Bulk Terminal - Indonesia
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