PLN discriminates against small coal suppliers for Suralaya plant

West Java?s coal-fired Suralaya power plant, a subsidiary of the state electricity company PLN, has discriminated against small suppliers of coal by valuing their products at only Rp 190,000 per ton, compared with the Rp 250,000 paid to Adaro and other large coal producers, according to an executive of a coal producing company who asked not be identified.

Actually, the quality of coal coming from small producers was similar to the one supplied by the large producers, the executive told Petromindo.com on today.

He made these remarks in response to Petromindo reports that PLN had practiced a dual pricing system for coal suppliers for quite sometime especially since coal prices picked up on the world market.

?I am fully certain this is an illegal practice. Suralaya has bought coal from small suppliers at only Rp 190,000 per ton. But its officials wrote Rp 250,000 in its book. This is crazy,? the executive said.

He disagrees with PLN officials who argued that that the coal supplied by small producers is of low quality only because it is transported with barges.

?Transportation is not their business. Suralaya should only need that coal reaches its port safely and on time. Whether or not it is transported with barges is our business,? he added.

A source at Indonesia Power told Petromindo that PLN had never practiced dual pricing systems for coal. But he was not clear whether the company had also bought coal from illegal coal miners.

Presently, Suralaya?s coal reserves are enough only for between two and four days, and not seven days as normally required. (*)