ESDM: Coal Production Quota to Exceed 600 Million Tonnes
Deputy Minister of Energy and Mineral Resources (ESDM) Yuliot has confirmed the government will grant a coal production quota exceeding 600 million tonnes as a relaxation policy amid surging coal prices. “Yes, definitely (above 600 million tonnes). Adjusting to domestic needs,” Yuliot said when met at the ESDM Ministry Office in Jakarta on Wednesday, 17 June 2026.
Yuliot stated the ESDM Ministry has evaluated domestic coal requirements, including the needs of steam power plants (PLTU) operated by PT PLN (Persero). Of the 154 million tonnes of coal required by PLN, the ministry noted that 134 million tonnes are already under contract. Thus, PLN still requires 20 million tonnes of coal to meet its power plant needs. “The shortfall of 20 (million tonnes) is being addressed,” Yuliot said.
Minister of Energy and Mineral Resources Bahlil Lahadalia said the government will implement a relaxation of coal production quotas following the commodity price increase resulting from the war involving the United States (US) and Israel with Iran. Bahlil stated the measured relaxation of the coal production quota is the government’s step to follow coal price developments. The reference coal price (HBA) for the second period of June 2026 was set at US$123.91 per tonne. This figure is higher compared to the HBA for the second period of May 2026, which was US$116.32 per tonne.
Ideally, Bahlil said, when prices are good, production should also be high to achieve a positive impact. However, Bahlil has not yet determined the coal production quota after establishing the production relaxation policy. At the beginning of 2026, the ESDM Ministry set the 2026 coal production quota at around 600 million tonnes, a reduction of 190 million tonnes compared to the 2025 realisation of 790 million tonnes. The cut was based on an imbalance between supply and demand in the international market throughout 2025. This imbalance caused coal prices to briefly touch US$97.65 per tonne in the second period of July 2025.
However, the outbreak of the US-Israel war with Iran caused coal prices to skyrocket from below US$120 per tonne to above US$130 per tonne within approximately one week in early March 2026. The current coal price increase is triggered by disruptions in the distribution of crude oil and liquefied natural gas (LNG) in the international market.