Only 2 of 13 Indonesian Coal Producers Serious About Business Diversification
Business diversification among coal companies in Indonesia remains limited and uneven. Of the 13 major producers analysed, only two companies were deemed to have shown concrete progress in building non-coal businesses at a material scale.
Meanwhile, six other companies were assessed as still being at a stage dominated by diversification narratives without significant implementation to follow.
The findings are contained in the latest report from the Energy Shift Institute (ESI) titled Diversification Gap in Indonesia’s Coal Sector.
Although coal market conditions have improved recently, companies still face a number of risks, ranging from dependence on key export markets and domestic policy uncertainty to rising cost pressures.
ESI Senior Analyst Idham Muhammad Fachri said business diversification can be a structural response for companies to reduce their dependence on coal revenue.
This strategy can run in parallel with market diversification and improvements in operational efficiency.
“Diversification strategies in this sector remain highly uneven. Some companies are building convincing non-coal businesses, while others have announced ambitions without showing meaningful progress,” Idham said in a written statement on Thursday (20/8/2026).
In its analysis, ESI used a seven-step framework to assess the level of company diversification. The assessment looked at the extent to which new businesses are able to shift the revenue base and reduce the company’s dependence on coal.
The results of the analysis placed PT Harum Energy Tbk and PT TBS Energi Utama Tbk as the companies that have made the most visible diversification progress.
Both have relatively low coal reserves compared with similar companies and have directed investment towards non-coal businesses, rather than continuing to expand their coal operations.
In 2025, the nickel business contributed 69 percent of Harum Energy’s total revenue. Meanwhile, 41 percent of TBS Energi Utama’s revenue came from its waste management business.
The change in revenue composition shows that diversification has not stopped at investment announcements or asset ownership in other sectors, but has begun to generate a material contribution to company revenue.
A number of other companies have also set targets to increase the contribution of non-coal businesses.
PT Bumi Resources Tbk, for example, is targeting a 50:50 revenue composition between coal and non-coal businesses by 2031.