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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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Friday, 10 October 14
INDONESIA TO DEVELOP DOWNSTREAM COAL INDUSTRY - JP
The government is planning to launch a program to develop the downstream coal industry to increase the commodity’s added value, an official h ...
Friday, 10 October 14
U.S. PRODUCED 83.2 MMST OF COAL IN SEPTEMBER, SAYS EIA
COALspot.com – United States the world's one of largest coal producers, produced approximately 18.6 million short tons (mmst) of coal in ...
Thursday, 09 October 14
CAPESIZE MARKET HAS CONTINUED TO SHOW WEAKNESS - FEARNLEYS
Handy
We mentioned last week that after several weeks of rate increase for the Supras, the bigger Panamaxes started to snap up better paying Supr ...
Thursday, 09 October 14
SHIPPING REMAINS CHALLENGED AS GLOBAL GROWTH DISAPPOINTS - BIMCO
The global shipping industry finds no grace from much stronger economic activity going forward, as the global recovery remains fragile and uneven. ...
Wednesday, 08 October 14
CAPES RATE FOR THE W. AUSTRALIA TO CHINA VOYAGE MOVED TO BELOW $8/MT - INTERMODAL
The Dry Bulk market remained under pressure last week, with rates for Capes remaining on the red while those for Panamaxes managed to outperform th ...
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- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- Banpu Public Company Limited - Thailand
- Standard Chartered Bank - UAE
- Energy Link Ltd, New Zealand
- Altura Mining Limited, Indonesia
- Indogreen Group - Indonesia
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- Bhushan Steel Limited - India
- Romanian Commodities Exchange
- Thai Mozambique Logistica
- Wilmar Investment Holdings
- Cigading International Bulk Terminal - Indonesia
- Aboitiz Power Corporation - Philippines
- Mercator Lines Limited - India
- Carbofer General Trading SA - India
- Deloitte Consulting - India
- Ministry of Mines - Canada
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Australian Commodity Traders Exchange
- Straits Asia Resources Limited - Singapore
- AsiaOL BioFuels Corp., Philippines
- Minerals Council of Australia
- Electricity Authority, New Zealand
- Sarangani Energy Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- Global Green Power PLC Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Sinarmas Energy and Mining - Indonesia
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Planning Commission, India
- The University of Queensland
- Ministry of Transport, Egypt
- Sindya Power Generating Company Private Ltd
- Kepco SPC Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Latin American Coal - Colombia
- Asmin Koalindo Tuhup - Indonesia
- Eastern Coal Council - USA
- Siam City Cement - Thailand
- Directorate Of Revenue Intelligence - India
- Meenaskhi Energy Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Interocean Group of Companies - India
- Australian Coal Association
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- Globalindo Alam Lestari - Indonesia
- Xindia Steels Limited - India
- Energy Development Corp, Philippines
- Global Business Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- PTC India Limited - India
- McConnell Dowell - Australia
- Jindal Steel & Power Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Posco Energy - South Korea
- Heidelberg Cement - Germany
- Therma Luzon, Inc, Philippines
- Attock Cement Pakistan Limited
- Wood Mackenzie - Singapore
- Parry Sugars Refinery, India
- Makarim & Taira - Indonesia
- IHS Mccloskey Coal Group - USA
- Bhatia International Limited - India
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Mineral Development Corp Ltd - India
- Orica Mining Services - Indonesia
- Orica Australia Pty. Ltd.
- Mintek Dendrill Indonesia
- White Energy Company Limited
- Sree Jayajothi Cements Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Semirara Mining Corp, Philippines
- Grasim Industreis Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Aditya Birla Group - India
- South Luzon Thermal Energy Corporation
- Jorong Barutama Greston.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- Bhoruka Overseas - Indonesia
- Indian Oil Corporation Limited
- Sical Logistics Limited - India
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- TeaM Sual Corporation - Philippines
- GN Power Mariveles Coal Plant, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Generating Authority of Thailand
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SMG Consultants - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Trasteel International SA, Italy
- Commonwealth Bank - Australia
- Antam Resourcindo - Indonesia
- Siam City Cement PLC, Thailand
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- Goldman Sachs - Singapore
- Ambuja Cements Ltd - India
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Marubeni Corporation - India
- Global Coal Blending Company Limited - Australia
- Africa Commodities Group - South Africa
- Economic Council, Georgia
- Mjunction Services Limited - India
- Borneo Indobara - Indonesia
- SMC Global Power, Philippines
- Alfred C Toepfer International GmbH - Germany
- GAC Shipping (India) Pvt Ltd
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Central Java Power - Indonesia
- Bukit Makmur.PT - Indonesia
- Gujarat Sidhee Cement - India
- Vedanta Resources Plc - India
- Parliament of New Zealand
- LBH Netherlands Bv - Netherlands
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- Chamber of Mines of South Africa
- Agrawal Coal Company - India
- Kartika Selabumi Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tamil Nadu electricity Board
- Manunggal Multi Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Kobexindo Tractors - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- OPG Power Generation Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Oldendorff Carriers - Singapore
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- PowerSource Philippines DevCo
- Jaiprakash Power Ventures ltd
- Bulk Trading Sa - Switzerland
- Karaikal Port Pvt Ltd - India
- The Treasury - Australian Government
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Anglo American - United Kingdom
- European Bulk Services B.V. - Netherlands
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Thiess Contractors Indonesia
- SN Aboitiz Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- CNBM International Corporation - China
- ICICI Bank Limited - India
- Toyota Tsusho Corporation, Japan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Singapore Mercantile Exchange
- Rio Tinto Coal - Australia
- Central Electricity Authority - India
- Riau Bara Harum - Indonesia
- Lanco Infratech Ltd - India
- Kideco Jaya Agung - Indonesia
- Bangladesh Power Developement Board
- San Jose City I Power Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Timah Investasi Mineral - Indoneisa
- Independent Power Producers Association of India
- Maheswari Brothers Coal Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Cement Manufacturers Association - India
- Indika Energy - Indonesia
- Savvy Resources Ltd - HongKong
- IEA Clean Coal Centre - UK
- Binh Thuan Hamico - Vietnam
- GMR Energy Limited - India
- Madhucon Powers Ltd - India
- Coalindo Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Iligan Light & Power Inc, Philippines
- Uttam Galva Steels Limited - India
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Tata Chemicals Ltd - India
- Pendopo Energi Batubara - Indonesia
- India Bulls Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Krishnapatnam Port Company Ltd. - India
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- ASAPP Information Group - India
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