Downstream Coal Economic Transformation Is More Sovereign

Member of Commission XII DPR RI Dewi Yustisiana emphasized that downstreaming of coal is a strategic step to transform Indonesia's economy towards energy sovereignty and strengthening the national industry.

"So far, Indonesia has relied too much on exports of raw materials, even though the potential for coal is very large to be processed into high-value products," said Dewi as quoted by ANTARA, Sunday, May 11.

According to him, Indonesia's coal exports are very large. From data from the Ministry of Energy and Mineral Resources from total sales of 811.01 million tons, around 433.17 million tons were exported to various countries.

He said, one of the priorities for downstreaming is coal gasification to Dimethyl Ether (DME) as an import LPG substitution, as is being run by PT Bukit Asam (PT BA) in Tanjung Enim.

In addition, coal can also be processed into essential industrial raw materials such as methanol and urea for the petrochemical and fertilizer sectors.

PT BA and PT Perusahaan Gas Negara Tbk (PGN) are also developing Subtitute Natural Gas (SNG) or synthetic natural gas that allows coal to be converted into liquid fuel such as diesel and synthetic gasoline, is also part of the downstream roadmap even though it is still in its early stages.

Furthermore, Dewi highlighted the importance of diversifying downstream products such as briquettes, active carbon, and synthetic graphite to support various industries including the growing electric vehicle battery industry.

To support the acceleration of coal downstream, the government, in this case the Ministry of Energy and Mineral Resources, continues to take strategic steps.

Therefore, Dewi encouraged the government to prepare various fiscal and non-fiscal incentives, including tax exemptions, ease of licensing, and off-taker schemes to ensure market certainty.

"Hilirisasi ini bukan hanya proyek ekonomi, tapi bagian dari agenda besar menciptakan ekonomi yang mandiri dan berdaulat, tegas legislator asal Daerah Pemilihan Sumatera Selatan II itu.

He reminded that these efforts face major challenges such as high investment needs, foreign technology dependence, and uncertainty in the price of downstream products compared to raw coal.

Dewi also encourages close collaboration between the government, state-owned enterprises, and the private sector so that this transformation can run consistently and have a direct impact on people's welfare.