The Philippine government has maintained confidence in its coal supply deal with Indonesia, even as Indonesia cuts its gas exports to Singapore.
For her part, Secretary Sharon Garin of the Department of Energy (DOE) assured that both parties will honor their coal contracts, even as Indonesia revises its export rules to improve transparency and supply-chain traceability.
‘We have received assurance about the supply, and we asked them if they could keep the price stable despite the changes,’ she told reporters on the sidelines of the Singapore International Energy Week.
‘But we don’t have the same issue as of yet, reported like the issue of Singapore on their gas,’ the official added.
Based on reports, Indonesia has decided to cut gas exports to Singapore to focus on domestic power needs, while keeping exports within agreed limits.
For the Philippines’ case, it imports almost 85 percent of its coal supply from Indonesia. Garin said Indonesian coal was ‘a very important part of our power system,’ as the market relies heavily on coal.
On one hand, coal accounts for about 60 percent of the Philippines’ power generation, providing much of its baseload capacity. On the other hand, the Philippine government also plans to release a coal transition policy that could prompt the startup of 3 to 5 gigawatts of baseload capacity from idle contracts.
In contrast, renewable energy account for 25 percent, still far from the government’s target of scaling up its share to 35 percent by 2030.
Garin also said the DOE is ‘seriously studying’ a blending facility or coal terminal.
Still, a blending terminal will source supply from domestic and foreign markets to mix high-grade and low-grade coals, adjusting blends to meet various industrial requirements.