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Indonesia Drought Threatens Coal Shipments and Raises Global Manufacturing Costs
Indonesia is a major supplier of coal used to make electricity.
Much of that coal travels by barge along rivers on the island of Borneo.
A severe drought has made the rivers too shallow for barges to carry their usual loads.
This slows deliveries and makes coal more expensive.
Some coal companies have said they cannot complete shipments because of the unusual conditions.
If the dry weather continues, factories in Asia could face higher electricity costs or power shortages.
The article says this shows that fossil fuels can depend on fragile transport routes.
It also says solar power and batteries could provide dependable electricity at lower costs.
Thailand’s plan to greatly increase renewable energy is presented as one example of this shift.
Indonesia supplies roughly two-thirds of internationally traded thermal coal, with most mined in two Borneo provinces.
Low water levels are forcing coal barges to carry smaller loads, slowing shipments and increasing costs.
Indonesia’s August coal exports were reportedly the lowest in five years, while some miners declared force majeure.
Rainfall across Indonesia could be as much as 80% below normal through November, potentially extending disruptions into 2026.
The article argues that renewable power paired with batteries could provide a more secure and affordable alternative to fossil fuels.
- Who
- Coal miners, shippers, Asian manufacturers, and governments are affected; David Fickling wrote the opinion column.
- What
- Drought is disrupting Indonesia’s coal transport and raising concerns about energy security and manufacturing costs.
- Where
- Indonesia, especially the rivers of Borneo, with potential effects across South and Southeast Asia.
- When
- The disruption is occurring during the current dry season, with forecasts extending through November and possibly into 2026.
- Why
- Exceptionally low rainfall is lowering river levels and narrowing shipping channels used to move coal to ports.
Renewables and Energy Security
Fossil Fuels and Existing Supply
Reliability
Renewables and Energy Security
The article argues that solar power combined with batteries can provide dependable electricity while avoiding dependence on vulnerable coal and gas supply routes.
Fossil Fuels and Existing Supply
The fossil-fuel industry has promoted coal and liquefied natural gas as solutions for rising electricity demand in South and Southeast Asia.
Cost and investment
Renewables and Energy Security
The article cites an Indian auction in which 16 developers bid below the cost of new coal and offered fixed prices for 25 years.
Fossil Fuels and Existing Supply
Coal and gas remain part of the energy strategy discussed by governments and industry, although the article argues that their costs and construction delays weaken that case.
Energy transition policy
Renewables and Energy Security
The column presents Thailand’s proposed increase in renewable energy as a cleaner and more secure system.
Fossil Fuels and Existing Supply
Japan’s regional energy-transition initiative has funded studies on extending coal and gas plant operations using ammonia, hydrogen, or biomass.
Key facts
- Indonesia’s coal share
- Roughly two-thirds of internationally shipped thermal coal originates in Indonesia.
- Main mining area
- About 80% of Indonesia’s exported thermal coal is mined in two provinces on Borneo.
- August exports
- Coal export volumes in August were reported as the lowest in five years.
- Production disruption estimate
- A local employers’ group estimated that about 3.9 million metric tons of production could be affected per month.
- Rainfall forecast
- Rainfall through November could be as much as 80% below normal across the Indonesian archipelago.
- Mahakam River risk
- Droughts on the Mahakam River can last for 13 months, according to the article.
- Thailand renewable target
- Thailand announced plans to raise renewables’ share from 15% to as much as 89%.
Sources
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