Celios Economist Message To ESDM Minister Bahlil Lahadalia: Coal DMO Revision

JAKARTA - Executive Director of the Center of Economic and Law Studies (Celios) Bhima Yudhistira advised the Minister of Energy and Mineral Resources (SDM) Bahlil Lahadalia to revise the number of obligations to fulfill the domestic market (Domestic Market Obligation/DMO) coal. According to him, the revision of the DMO aims to accelerate the energy transition to renewable energy (EBT), as well as mitigate the risk dependence of fossil fuels, especially in power plants.

"Together with the Ministry of Finance, it is necessary to discuss the revision of the coal DMO which poses a risk of dependence on fossil fuels, especially in power plants," said Bhima as quoted by ANTARA, Monday, August 19.

Bhima said the coal DMO could be reduced to 100 million tons per year.

This figure is down by almost half the value of the annual realization of domestic market fulfillment (year on year/yoy) in 2023 at 177 million tons.

"The realization of DMO in 2023 is recorded to exceed the prognosis of the Ministry of Energy and Mineral Resources, which is 120 percent of the target of 177 million tons," he said.

Bahlil, continued Bhima, must also accelerate the number of coal steam power plants (PLTU) that have been retired, including PLTU which is operated and used outside the electricity network by industry players (cative), as well as revise Presidential Regulation (Perpres) Number 112 of 2022 concerning Acceleration of Renewable Energy Development for the Provision of Electricity.

"Revision of Presidential Regulation Number 112 of 2022 which still allows the construction of PLTU for new industrial areas also needs to be revised. It is estimated that there are 21 gigawatt PLTU industrial areas that want to be built and hinder Indonesia's efforts to achieve carbon emissions targets," he said.

For your information, President Joko Widodo (Jokowi) inaugurated Bahlil Lahadalia as Minister of Energy and Mineral Resources (ESDM) replacing Arifin Tasrif at the State Palace, Jakarta.

Deputy for Apparatus Administration of the Ministry of State Secretariat Nanik Purwanti said that Bahlil's inauguration as Minister of Energy and Mineral Resources was based on Presidential Decree Number 92P of 2024 concerning the Dismissal and Appointment of State Ministers of the Advanced Indonesian Cabinet for the 2019-2024 Period.