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The Philippines Wants Indonesia to Lift the Coal Export Ban

The ban could have a negative impact on the country’s power generation systems.
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The Philippines wants Indonesia to lift its coal export ban to the Philippines, saying it could negatively impact the country’s power generation systems that are heavily reliant on coal. 

In a formal appeal to Indonesia’s Minister of Energy and Mineral Resources, the Department of Energy, through Secretary Alfonso Cusi, said the recent policy would be “detrimental to economies that currently rely on coal-fired power generation systems like the Philippines.”

Indonesia, the world’s largest thermal coal exporter, suspended exports for the month of January because of “dangerously” low inventory levels, which it said could result in a power crisis. 

However, that could translate to a power crisis for our country instead. Last year, the Philippines imported as much as 2.3 million metric tons of coal monthly from Indonesia.

“Power generated from coal comprises about 60 percent of the country’s power demand,” Cusi said. 

The DOE’s Electric Power Industry Management and Energy Resource Development Bureaus will meet on Tuesday (January 11) to discuss how to manage the issue and potential strategies. Cusi has also asked the Department of Foreign Affairs to intercede and appeal Indonesia’s exports ban through ASEAN. 

Reuters reported that Indonesia’s ban drove coal prices in other countries like China and Australia higher, while ships loaded with coal were not allowed to depart Kalimantan, the archipelago’s main coal port.

Meanwhile, Meralco’s Utility Economics chief Lawrence S. Fernandez said the ban will affect three of the power distributor's suppliers: San Buenaventura (455MW), Quezon Power (440MW), and Panay Energy (70MW). 

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“According to our suppliers, they have sufficient supply of coal for at least two months,” Fernandez said. “In the coming couple of months, we are assured that there will be no supply disruption.”  

Fernandez said the country may also decide to look for coal from other sources, including Australia, although pricing may be an issue.

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