By Hans Nicholas Jong, Mongabay.com
Indonesia’s coal industry is enjoying a resurgence, driven both by rising demand from China—the world’s biggest consumer of the fossil fuel—and a push by the government in Jakarta to build more coal-fired power plants.
A coal barge in Central Kalimantan, Indonesia. Image: Andrew Taylor/WDM, CC BY 2.0
Demand for energy in China and Indonesia continues to drive the resurgence of the latter’s coal industry, setting back efforts in both countries to shift to a greater share of renewable energy.
Mining, freight and trade executives were largely upbeat at what was billed as the coal industry’s biggest event of the year, the 24th Coaltrans Asia, on the Indonesian resort island of Bali earlier this month. Analysts who attended the three-day conference said the outlook in China was still very strong, especially for coal from Indonesia, one of the world’s biggest exporters of the fossil fuel.
Arcandra Tahar, Indonesia’s deputy minister for energy and mines, said the government planned to increase its investment in the coal and minerals sector this year to $6.2 billion. He also told the Coaltrans Asia conference that Indonesia had no plans to reduce coal exports, Reuters reported.
Indonesia’s coal exports are expected to hit 371 million metric tons this year, up 7 per cent from last year.
Domestic demand is also driving the boon for Indonesia’s coal producers, thanks to an ambitious government plan to add 56 gigawatts (GW) of electricity capacity across the archipelago by 2027, mostly through the construction of new coal-fired power plants.