ASIATODAY.ID, JAKARTA — Indonesia’s coal industry hit a record-high 836 million tonnes (Mt) in 2024, but the milestone hides a grim reality: shrinking state revenue, declining profits, and skyrocketing methane emissions that threaten the nation’s climate goals and regional economies.
A new report by Ember warns that Indonesia’s relentless coal expansion is becoming unsustainable. Oversupply in global markets has driven prices down, eroded company profits, and reduced government income, despite massive production growth.
“Coal-producing regions in Indonesia must brace for declining revenue. Once public budgets shrink, it will be much harder to diversify local economies,” said Timon Wehnert, Deputy Head of the International Energy Transition Research Unit at the Wuppertal Institute on November 6, 2025.
Coal demand began to decline in early 2025, with production down 33 Mt in the first half of the year. Exports to China and India, which account for about 60% of Indonesia’s coal trade, have weakened as both nations accelerate renewable energy development and bolster domestic supply.
The report projects a 10% drop in coal demand this year compared to 2024. Meanwhile, company profits have plunged 67% from their 2022 peak, and non-tax state revenue (PNBP) from coal fell 18.6% in 2024.
Methane Emissions Soar 4x Higher Than Official Data
Perhaps the most alarming finding: coal mine methane (CMM) emissions in 2024 reached 722 kilotonnes (kt) — more than four times higher than Indonesia’s official estimate.
This surge stems from inaccurate emission factors and the exclusion of underground mining emissions. Even if coal output declines, CMM emissions are projected to rise 25% by 2030, driven by the expansion of underground coal mines, especially in South Kalimantan, which alone could emit 332 kt of CH₄ annually by 2030.
Abandoned coal mines (known as Abandoned Mine Methane, or AMM) also pose a long-term risk, continuing to leak methane long after operations cease.
Ember Calls for a Coal Moratorium
Ember urges Indonesia to shift from expansion to management by:
1. Imposing a moratorium on new coal mining permits,
2. Integrating strict long-term production caps into annual work plans (RKAB), and
3. Mandating facility-level emissions reporting for all mining operators.
“A coal transition strategy is essential to guide the industry and support producing regions in adapting to the evolving energy landscape,” said Dody Setiawan, Senior Climate and Energy Analyst at Ember.
He added that Indonesia’s newly released Second Nationally Determined Contribution (SNDC) includes commitments to mitigate coal mine methane emissions — a key step toward a more accountable climate policy framework.
A Double-Edged Record for Indonesia
Indonesia’s record-breaking coal production is becoming a double-edged sword. While it still supports the national economy, the falling revenues and exploding methane emissions underscore that the coal business model is no longer sustainable.
“Without a decisive shift toward energy transition and emission control, Indonesia risks undermining both its climate ambitions and its economic stability,” said Dody Setiawan. (AT Network)
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