Indonesia’s Energy Ministry Sees Coal DMO Rising Up to 30%
Fri 06 Feb 2026, 03:12 AM
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The Ministry of Energy and Mineral Resources (MEMR) estimates that the percentage of the Domestic Market Obligation (DMO) for coal could rise up to 30 percent following the reduction of domestic production quotas.
"We are calculating it now. The range could potentially be more than 30 percent," stated Vice Minister of MEMR, Yuliot, when met at the Ministry of MEMR in Jakarta on Friday.
Yuliot explained that the DMO percentage will certainly increase if the coal production quota is slashed.
The Ministry of MEMR estimates that the national coal production quota for 2026 will be in the range of 600 million tons.
This figure represents a decrease of 200 million tons compared to the actual coal production in 2025, which reached 800 million tons.
The regulation regarding coal DMO is stipulated in the Decree of the Minister of Energy and Mineral Resources Number 399.K/MB.01/MEM.B/2023, which amends Minister of MEMR Decree Number 267.K/MB.01/MEM.B/2022 concerning the Fulfillment of Domestic Coal Needs.
The government previously set the DMO coal sales percentage at 25 percent of the actual coal production in the current year.
This rule applies to holders of Coal Mining Business Licenses (IUP) for production operations, Special Mining Business Licenses (IUPK) for coal operations, and Coal Mining Contracting Agreements (PKP2B) for the production operation stage.
The 25 percent of actual coal production is utilized to fulfill electricity supply needs for public interest and self-interest, as well as raw materials/fuel for industry.
Additionally, the government still maintains the coal Domestic Price Obligation (DPO) specifically for PT PLN (Persero) power plants at USD 70 per ton.
Furthermore, in accordance with Article 157 of Government Regulation Number 39 of 2025—the Second Amendment to Government Regulation Number 96 of 2021 concerning the Implementation of Mineral and Coal Mining Business Activities—IUP or IUPK holders in the production operation stage are required to meet domestic mineral and/or coal needs and prioritize the needs of State-Owned Enterprises (BUMN) in sectors that control the livelihoods of the general public.
Those sectors include electricity, energy supply, fertilizer, and national strategic industries.
Paragraph (3) of Article 157 of PP 39/2025 states that the obligation to prioritize such fulfillment must be carried out before conducting overseas sales or exports.
"Previously, the DMO was around 23-24 percent; therefore, with the decrease in production, the DMO percentage will definitely experience an increase," said Yuliot.
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