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Friday, 04 September 20
IN A DEEPENING DEBT HOLE OF $34 BILLION, INDONESIA’S PLN MUST STOP DIGGING - IEEFA
 The utility has added IDR100 trillion in debt annually for the last five years
Utilities globally started changing the way they do business years ago, but Indonesia’s PLN power company stands out as a laggard, focused on a confused menu of piecemeal generation options rather than holistic planning that provides system-level solutions, finds a new report from IEEFA, the Institute for Energy Economics and Financial Analysis.
PLN, alongside utilities worldwide, has suffered a severe drop in revenue as power consumption fell by as much as 20% in some cases amid the COVID-19 pandemic, writes Elrika Hamdi, author of the report Never Waste a Crisis – Indonesia’s PLN Needs A Coherent Strategy to Ride Out the COVID-19 Pandemic.
“But the roots of PLN’s problems are deeper than just the pandemic: PLN’s quiet crisis reflects dysfunctional planning and governance that have put the company into strategic paralysis, unable to change direction or adapt to new market realities,” says Hamdi.
“Despite all the warning signs, senior managers still run the power sector with an old-fashioned business-as-usual mindset. Unfortunately, a 2010 playbook will not save PLN from falling deeper into a modern-day debt trap. Neither will indulging an extractive economy mindset that fosters dependence on fossil fuel, just because it’s there”.
“There has to be a willingness to ask the hard questions when PLN’s ocean of red ink proclaims that PLN’s resource-driven development plans are obsolete in a high-technology world.”
The report notes that much of PLN’s current predicament stems from a plan to add a massive 35 gigawatts of generation capacity to Indonesia’s power supply that was poorly designed and implemented.
“The 35 GW program is a political promise that was meant to embody President Joko Widodo’s (Jokowi’s) ambition to fully electrify Indonesia. There is nothing wrong with the ambition, but the subsequent planning and execution has lacked accountability,” says Hamdi.
“Adding generation capacity has become a goal with little attention paid to long-term financial impacts or new system design options. In the absence of much-needed checks and balances, PLN has been driven to the brink and taxpayers will be left to pay the price.”
“PLN’s ability to sustain debt at this level rests firmly on Indonesia’s investment-grade sovereign credit rating and the government’s readiness to support PLN debtors in the event of financial distress,” says Hamdi, noting that PLN bonds are still relatively attractive to investors because of the company’s monopoly and its quasi-sovereign status.
The author also questions the accountability of government support for PLN. Noting both direct and indirect supports, including subsidies, compensation, capital injections, special accounting treatments and government guarantees, Hamdi says there appears to be little consistent oversight of how government support is used to dress up PLN’s accounting.
“The Ministry of Finance, considering PLN’s strategic importance, makes PLN a top priority, but that does not mean PLN’s financial problems can be effectively addressed by endless access to cheap debt that could eventually threaten Indonesia’s financial credibility,” she concludes.
“The best strategy for PLN would be to rebase their planning framework to focus on more cost-effective grid investments that improve the long-run efficiency of the whole power system. Private sector players cannot invest in the grid and have therefore crowded into the generation sector. This has accentuated PLN’s narrow focus on baseload generation has resulted in excess capacity and a brittle system that lacks flexibility. What’s needed now is a more grid-centric strategy that would permit PLN’s investment to enable a more efficient system. It is crucial for PLN to make sure that the power sector reform is not just cosmetic.”
About IEEFA
The Institute for Energy Economics and Financial Analysis (IEEFA) conducts global research and analyses on financial and economic issues related to energy and the environment. The Institute’s mission is to accelerate the transition to a diverse, sustainable, and profitable energy economy.
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Wednesday, 26 August 20
ASIAN COAL PRICES LIKELY TO REMAIN DEPRESSED SAY TRADERS, ANALYSTS - REUTERS
Asian coal prices, which have fallen around 25% this year as power demand slumped due to the coronavirus outbreak, are unlikely to move higher befo ...
Wednesday, 26 August 20
WORLD COAL EXPORTS: INDONESIAN THERMAL COAL EXPORTS HAVE COME UNDER PRESSURE AS THERMAL COAL PRICES WEAKEN - REPORT
Indonesia’s exports to decline sharply from record highs
Indonesia is the world’s largest thermal coal exporter, sellin ...
Wednesday, 26 August 20
JAPAN'S COAL IMPORTS ARE BEING AFFECTED BY COMPETING INFLUENCES - REPORT
Japan is the world’s third largest thermal coal importer, importing an estimated 135 million tonnes of thermal coal in 2019. The country&rsqu ...
Wednesday, 26 August 20
PENDING SOUTH KOREA LEGISLATION COULD FORCE HALT TO COUNTRY’S COAL PLANT EXPORT DEALS - KOREA ECONOMIC DAILY
South Korea’s parliament looks set to pass new legislation to ban financing on foreign coal power projects, putting all overseas coal-fired p ...
Tuesday, 25 August 20
INDIA'S IMPORTS FALL AS LOCKDOWNS IMPACT THE POWER AND INDUSTRIAL SECTORS - REPORT
India is the world’s second largest thermal coal consumer and importer, importing an estimated 211 million tonnes of thermal coal in 2019.&nb ...
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Showing 811 to 815 news of total 6871 |
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- Interocean Group of Companies - India
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- Rio Tinto Coal - Australia
- Makarim & Taira - Indonesia
- Xindia Steels Limited - India
- Bhoruka Overseas - Indonesia
- Coal and Oil Company - UAE
- Ceylon Electricity Board - Sri Lanka
- Jaiprakash Power Ventures ltd
- Sical Logistics Limited - India
- Aditya Birla Group - India
- Ministry of Mines - Canada
- Toyota Tsusho Corporation, Japan
- Indika Energy - Indonesia
- Singapore Mercantile Exchange
- Videocon Industries ltd - India
- Essar Steel Hazira Ltd - India
- SMC Global Power, Philippines
- Price Waterhouse Coopers - Russia
- Parliament of New Zealand
- Cigading International Bulk Terminal - Indonesia
- Central Electricity Authority - India
- Banpu Public Company Limited - Thailand
- Orica Mining Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Deloitte Consulting - India
- Ind-Barath Power Infra Limited - India
- Georgia Ports Authority, United States
- Billiton Holdings Pty Ltd - Australia
- Agrawal Coal Company - India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Sidhee Cement - India
- Independent Power Producers Association of India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jindal Steel & Power Ltd - India
- Ambuja Cements Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Savvy Resources Ltd - HongKong
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- Orica Australia Pty. Ltd.
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Africa Commodities Group - South Africa
- Kartika Selabumi Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Sakthi Sugars Limited - India
- Economic Council, Georgia
- Chettinad Cement Corporation Ltd - India
- Ministry of Finance - Indonesia
- Bukit Baiduri Energy - Indonesia
- Anglo American - United Kingdom
- GAC Shipping (India) Pvt Ltd
- Alfred C Toepfer International GmbH - Germany
- Simpson Spence & Young - Indonesia
- Tata Chemicals Ltd - India
- Lanco Infratech Ltd - India
- Siam City Cement - Thailand
- South Luzon Thermal Energy Corporation
- GMR Energy Limited - India
- ASAPP Information Group - India
- Directorate General of MIneral and Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- The University of Queensland
- Neyveli Lignite Corporation Ltd, - India
- SN Aboitiz Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Carbofer General Trading SA - India
- Latin American Coal - Colombia
- Gujarat Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Oldendorff Carriers - Singapore
- Bharathi Cement Corporation - India
- Samtan Co., Ltd - South Korea
- Star Paper Mills Limited - India
- ICICI Bank Limited - India
- Posco Energy - South Korea
- Bhatia International Limited - India
- Indian Energy Exchange, India
- Dalmia Cement Bharat India
- MS Steel International - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Sojitz Corporation - Japan
- Bahari Cakrawala Sebuku - Indonesia
- SMG Consultants - Indonesia
- San Jose City I Power Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- White Energy Company Limited
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- Binh Thuan Hamico - Vietnam
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Vizag Seaport Private Limited - India
- Formosa Plastics Group - Taiwan
- Vedanta Resources Plc - India
- New Zealand Coal & Carbon
- Salva Resources Pvt Ltd - India
- Mercator Lines Limited - India
- Uttam Galva Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Baramulti Group, Indonesia
- Karaikal Port Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Miang Besar Coal Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Petron Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- PowerSource Philippines DevCo
- Bangladesh Power Developement Board
- Bulk Trading Sa - Switzerland
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- Bukit Makmur.PT - Indonesia
- Malabar Cements Ltd - India
- Renaissance Capital - South Africa
- Marubeni Corporation - India
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Antam Resourcindo - Indonesia
- Ministry of Transport, Egypt
- Edison Trading Spa - Italy
- Bayan Resources Tbk. - Indonesia
- Mintek Dendrill Indonesia
- CIMB Investment Bank - Malaysia
- Cement Manufacturers Association - India
- Romanian Commodities Exchange
- Parry Sugars Refinery, India
- Altura Mining Limited, Indonesia
- TeaM Sual Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Kumho Petrochemical, South Korea
- The State Trading Corporation of India Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Planning Commission, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- VISA Power Limited - India
- Meralco Power Generation, Philippines
- Manunggal Multi Energi - Indonesia
- Commonwealth Bank - Australia
- Sinarmas Energy and Mining - Indonesia
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Bhushan Steel Limited - India
- Australian Commodity Traders Exchange
- Semirara Mining Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Wilmar Investment Holdings
- Medco Energi Mining Internasional
- Kideco Jaya Agung - Indonesia
- Central Java Power - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Maheswari Brothers Coal Limited - India
- Indogreen Group - Indonesia
- Minerals Council of Australia
- Merrill Lynch Commodities Europe
- LBH Netherlands Bv - Netherlands
- Eastern Coal Council - USA
- Eastern Energy - Thailand
- Electricity Authority, New Zealand
- Metalloyd Limited - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Globalindo Alam Lestari - Indonesia
- Kaltim Prima Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Holcim Trading Pte Ltd - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Goldman Sachs - Singapore
- London Commodity Brokers - England
- Global Business Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- CNBM International Corporation - China
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Grasim Industreis Ltd - India
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Indonesian Coal Mining Association
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Larsen & Toubro Limited - India
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Borneo Indobara - Indonesia
- Standard Chartered Bank - UAE
- PetroVietnam Power Coal Import and Supply Company
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