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Gov't Refuses Coal Prices Subsidy  

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14 March 2016 18:54 WIB

Sudirman Said. TEMPO/Subekti

TEMPO.CO, Jakarta - The Energy and Mineral Resources Ministry refused to provide coal subsidy for steam-powered power plants (PLTU). Energy and Mineral Resourced Minister Sudirman Said argued that cola prices should be regulated according to market mechanism. "There's no need for subsidy because what is actually needed is regulation and facilities for coal companies," Sudirman said on Monday, March 14, 2016.

Sudirman admitted that currently, coal benchmark price continues to decrease following recent drop in the global coal market. However, Sudirman said that the condition will return to normal as the market reaches its equilibrium point.

Sudirman explained that market equilibrium can be reached if coal production purposes can be shifted from export-oriented to domestic consumption, for example, to fulfill the government's 35,000 MW electricity project.

Nevertheless, Sudirman said that he will attempt to facilitate coal businesses who wish to cooperate with the State Electricity Company (PLN). "The purpose is to achieve a balanced price, discussions have started," Sudirman said.

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