China Expands Coal-Fired Power Plants, Increasing RI Coal Export Potential by 10%
Sat 19 Apr 2025, 19:21 PM
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China's decision to add coal-based Steam Power Plants (PLTU) until 2027 is considered to have an impact on increasing Indonesian coal exports.
According to the Indonesian Energy, Mineral and Coal Suppliers Association (Aspebindo), this export increase could reach 10% per year. "If China consistently increases PLTU capacity and optimizes new power plants, then Indonesian coal exports to China have the potential to grow by 10% per year until 2027 or an additional 25 million tons per year," said Fathul Nugroho, Deputy Chairman of Aspebindo, Wednesday (16/04).
However, the potential for increased exports will also depend on China's domestic supply capabilities and competition with other producers such as Australia.
"However, this figure needs to be reviewed if there is a decline in demand from China's industrial sector due to the tariff war with the US," he added.
He also added that China's plan to continue building PLTUs for electricity supply is supported by its domestic industry which continues to grow.
"China's policy of building PLTUs until 2027 opens up significant opportunities for increasing Indonesian coal exports. China is still the main market for Indonesian thermal coal, and their coal needs are projected to remain high," he explained.
In total between 2026-2027, China is expected to build 60 GW of new PLTUs, outside of the 95 GW that will operate in 2025.
According to Fathul, the increase in demand from China could be a positive stimulus for global coal prices, especially if accompanied by limited supply from major producers.
"Aspebindo estimates that thermal coal prices will be in the range of US$ 60 per ton–US$ 80 per ton for GAR 4,200 and US$ 120 per ton–US$ 150 per ton for GAR 6,300. With the potential for a spike if there is a supply disruption or sudden increase in demand," he said.
China's plan will boost the performance of Indonesian coal companies, both mining contractors and supply chains and traders .
However, coal companies must also overcome challenges such as regulatory pressure, rising operating costs, and competition with alternative energy sources.
"Aspebindo encourages companies to increase efficiency and investment in low-emission technology to maintain competitiveness in the global market," he concluded.
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