Indonesian state-owned energy utility Perusahaan Listrik Negara (PLN) is in talks with US and European investors to finance its plans for the early retirement of coal power plants, Reuters has reported.

The utility firm has set a target to reach carbon neutrality by 2060 and is planning an early retirement for its coal-fired power plants, which have a combined capacity of 10GW, in view of this.

Speaking at a G20 side event in Bali, PLN CEO Darmawan Prasodjo said: “We are in the process of negotiating with global communities, American counterparts, European counterparts (and) global investment (firms) about an energy transition mechanism (ETM).”

As of 2020, PLN had 63.3GW of installed power capacity, 50% of which was from coal-fired power plants.

Under the company’s coal power plant retirement programme, 6.7GW of capacity has been earmarked for retirement.

Darmawan added that some of the company’s coal power plants are scheduled for retirement by 2044, but the company aims to expedite the phase-out process by ten years with ‘affordable’ financing from overseas investors.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Although PLN had pledged not to commission coal power plants, some of its coal projects are still under development and are expected to come online by 2026.

These would increase Indonesia’s coal-based power generation capacity by 13GW.

Based in Jakarta, PLN has a monopoly on Indonesia’s electric power distribution and generates the majority of the country’s power.

Reuters reported that the company also signed a principal framework agreement with Indonesian state-owned coal miner PT Bukit Asam at the G20 side event.

Under this agreement, PT Bukit Asam will acquire PLN’s coal-fired power plant in West Java.

The company’s president-director Arsal Ismail said the takeover could reduce the plant’s lifetime by nine years, but did not disclose the terms and value of the agreement.