September 7, 2023 - Indonesian state-owned utility PLN's fuel supply arm PLN EPI aims to increase its coal supply capability to 101mn t by 2027, in line with a corporate mandate it set out when the company was established.

PLN EPI did not disclose how much coal it has supplied since it was formed in September 2022. Indonesia's energy ministry ESDM has projected the country's power demand to consume up to 161mn t of coal this year, 83mn t of which will be by PLN's own coal-fired plants. Consumption is expected to continue to increase until 2030 as power demand continues to rise, with renewable energy plants unlikely to significantly offset higher overall demand because of limited capacity.

PLN EPI was formerly known as PLN Batubara and was responsible for supplying roughly 20pc of PLN's coal needs, with the remainder coming from offtake contracts signed by individual power plants. But a domestic supply crunch in early 2022 resulted in the dissolution of PLN Batubara, which was replaced by PLN EPI, the utility said.

The Indonesian government further extended PLN EPI's mandate to include the provision of coal and the development of existing mines to supply all of PLN's coal-fired power plants and other fuel types for other plants. This was meant to centralise coal supply to PLN-owned power plants, thereby ensuring ample fuel stockpiles and avoid a power supply crisis, PLN EPI said.

PLN EPI is currently in the process of developing its transportation and logistics capabilities to ensure that it will be able to fulfill growing demand for coal from the power sector, the company said.

Its shipping subsidiary Pelayaran Bahtera Adhiguna is currently expanding its maritime fleet, with the recent addition of the Supramax vessel Latifah Baruna taking its total fleet of coal-carrying vessels to 14.

PLN EPI said it will continue to acquire ships to increase its transportation capacity and strengthen its delivery network. It is also currently in talks with coal mining companies to form long-term supply contracts on behalf of PLN's individual power plants, the company said.