Coal producers urge PLN targets to match approved production plans

Coal producers have warned that meeting coal supply targets for state utility PT PLN cannot rely solely on government assignments, stressing that supply obligations must be aligned with approved production capacity, commercial contracts and logistics readiness to ensure timely deliveries to power plants.

Gita Mahyarani, executive director of the Indonesian Coal Mining Association (APBI), said the association does not have consolidated data on the total volume of coal supply contracts signed with PLN because the agreements are negotiated directly between individual mining companies and the utility.

"Regarding the number of contracts currently in effect, APBI does not have aggregate data from all companies that have received government assignments because the contracts are business agreements between suppliers and PLN," Gita said on Monday, as quoted by Kontan.

She said the industry's main concern is ensuring that government-assigned supply volumes are consistent with each company's production capacity approved under its Work Plan and Budget (RKAB), warning that misalignment could place excessive operational burdens on miners.

Gita added that achieving the government's target of supplying 212 million metric tons of coal this year will depend on a range of operational factors, including mining readiness and the smooth transportation of coal from mines to power plants.

"Meeting the assigned volume requires alignment between government assignments, production capacity approved under the RKAB, mining operational readiness and logistics from the mine to the power plant," she said.

Supply challenges persist

The government maintains that national coal supplies remain sufficient to meet electricity generation needs.

Tri Winarno, Director General of Mineral and Coal at the Ministry of Energy and Mineral Resources (ESDM), said the government has assigned mining companies to supply 212 million metric tons of coal this year, well above PLN's projected coal requirement of 154 million metric tons.

As of May 2026, coal supply contracts covering 144 million metric tons had been signed, while actual deliveries were estimated at 130.5 million metric tons.

"PLN must accelerate the signing of contracts so that coal supply assignments can be quickly translated into direct deliveries to coal-fired power plants," Tri said in an official statement issued last week.

He noted that signed contracts are a prerequisite for coal deliveries to coal-fired power plants (PLTUs). Although overall coal availability remains adequate, the government acknowledged that several challenges continue to hamper supplies, including shortages of medium-calorific-value coal at some power plants and the failure of several mining companies to meet their Domestic Market Obligation (DMO) requirements.

The supply issue has also been overshadowed by an alleged corruption case involving coal procurement for coal-fired power plants, which is under investigation by the Indonesian National Police's Anti-Corruption Crimes Unit. Authorities estimate the case may have caused state losses of up to Rp5 trillion ($307 million) between 2018 and 2026.

To strengthen oversight, the Energy Ministry has established a special task force involving the Financial and Development Supervisory Agency (BPKP) to ensure coal procurement for PLN complies with regulations and that primary energy supplies remain secure.

Editing by Reiner Simnajuntak