• Home
  • Politics
  • Health
  • World
  • Business
  • Finance
  • Tech
  • More
    • Sports
    • Entertainment
    • Lifestyle
What's Hot

EXCLUSIVE: ‘The Man She Is Today’: European Companies Accused Of ‘Importing’ Woke Ideology

May 29, 2025

‘The Economy Is On Fire!’: Kevin O’Leary Drops Fact Check On CNN Panelists Railing Against Trump’s Economy

May 29, 2025

DeSantis Signs Bill Making Gold And Silver Legal Tender

May 28, 2025
Facebook Twitter Instagram
  • Contact
  • Privacy Policy
  • Terms & Conditions
Saturday, May 31
Patriot Now NewsPatriot Now News
  • Home
  • Politics

    Security video shows brazen sexual assault of California woman by homeless man

    October 24, 2023

    Woman makes disturbing discovery after her boyfriend chases away home intruder who stabbed him

    October 24, 2023

    Poll finds Americans overwhelmingly support Israel’s war on Hamas, but younger Americans defend Hamas

    October 24, 2023

    Off-duty pilot charged with 83 counts of attempted murder after allegedly trying to shut off engines midflight on Alaska Airlines

    October 23, 2023

    Leaked audio of Shelia Jackson Lee abusively cursing staffer

    October 22, 2023
  • Health

    Disparities In Cataract Care Are A Sorry Sight

    October 16, 2023

    Vaccine Stocks—Including Pfizer, Moderna, BioNTech And Novavax—Slide Amid Plummeting Demand

    October 16, 2023

    Long-term steroid use should be a last resort

    October 16, 2023

    Rite Aid Files For Bankruptcy With More ‘Underperforming Stores’ To Close

    October 16, 2023

    Who’s Still Dying From Complications Related To Covid-19?

    October 16, 2023
  • World

    New York Democrat Dan Goldman Accuses ‘Conservatives in the South’ of Holding Rallies with ‘Swastikas’

    October 13, 2023

    IDF Ret. Major General Describes Rushing to Save Son, Granddaughter During Hamas Invasion

    October 13, 2023

    Black Lives Matter Group Deletes Tweet Showing Support for Hamas 

    October 13, 2023

    AOC Denounces NYC Rally Cheering Hamas Terrorism: ‘Unacceptable’

    October 13, 2023

    L.A. Prosecutors Call Out Soros-Backed Gascón for Silence on Israel

    October 13, 2023
  • Business

    EXCLUSIVE: ‘The Man She Is Today’: European Companies Accused Of ‘Importing’ Woke Ideology

    May 29, 2025

    ‘The Economy Is On Fire!’: Kevin O’Leary Drops Fact Check On CNN Panelists Railing Against Trump’s Economy

    May 29, 2025

    DeSantis Signs Bill Making Gold And Silver Legal Tender

    May 28, 2025

    John Deere Announces $20 Billion Plan To Build Up American Manufacturing

    May 28, 2025

    EV Startup Promised To Cut China Ties — Then Reportedly Shared US Data Anyway

    May 27, 2025
  • Finance

    Ending China’s De Minimis Exception Brings 3 Benefits for Americans

    April 17, 2025

    The Trump Tariff Shock Should Push Indonesia to Reform Its Economy

    April 17, 2025

    Tariff Talks an Opportunity to Reinvigorate the Japan-US Alliance

    April 17, 2025

    How China’s Companies Are Responding to the US Trade War

    April 16, 2025

    The US Flip-flop Over H20 Chip Restrictions 

    April 16, 2025
  • Tech

    Cruz Confronts Zuckerberg on Pointless Warning for Child Porn Searches

    February 2, 2024

    FTX Abandons Plans to Relaunch Crypto Exchange, Commits to Full Repayment of Customers and Creditors

    February 2, 2024

    Elon Musk Proposes Tesla Reincorporates in Texas After Delaware Judge Voids Pay Package

    February 2, 2024

    Tesla’s Elon Musk Tops Disney’s Bob Iger as Most Overrated Chief Executive

    February 2, 2024

    Mark Zuckerberg’s Wealth Grew $84 Billion in 2023 as Pedophiles Target Children on Facebook, Instagram

    February 2, 2024
  • More
    • Sports
    • Entertainment
    • Lifestyle
Patriot Now NewsPatriot Now News
Home»Finance»Why Early Retirement of Coal Power is Faltering in Southeast Asia 
Finance

Why Early Retirement of Coal Power is Faltering in Southeast Asia 

December 27, 2023No Comments4 Mins Read
Facebook Twitter Pinterest LinkedIn Tumblr Email
Why Early Retirement of Coal Power is Faltering in Southeast Asia 
Share
Facebook Twitter LinkedIn Pinterest Email

For the last several years, clean energy transitions have often positioned early retirement of coal-fired power plants as part of larger decarbonization efforts. Coal power plants operate for decades; so if they can be shut them before the end of their anticipated economic lives it will reduce emissions while clearing out space for more investment in renewable energy. 

In theory, it is a fine idea. In practice, there are numerous obstacles to implementation, and high-profile clean energy initiatives, such as Indonesia’s Just Energy Transition Partnership (JETP), are only now coming to terms with them. The reality is that the early retirement of coal-fired power is, for what should have been obvious reasons, proving to be very difficult.  

When private developers enter a market like Indonesia or Vietnam and build coal-fired power plants, they typically do so only after signing a long-term contract with the local utility first. These contracts can run for 25 years or longer, and they guarantee the utility will buy electricity from the developer at a fixed price over a certain period of time. 

If a government wants to retire a coal-fired power plant before the end of its useful life, it needs to change the terms of this contract first. Otherwise, why would the management, investors and lenders that have potentially sunk billions of dollars into a project with the expectation that it will run and generate returns for 25 years agree to shut it down early? 

Electric utilities can simply break the contracts and change the terms unilaterally. But governments in emerging markets are especially keen to avoid this option as they fear it will deter future investment if they become known as a place that doesn’t honor contracts. 

See also  Southeast Asia’s Quest for Digital Sovereignty

That means in order to change the terms of the contracts, shareholders and the management of coal-fired power plants need to be offered a sufficiently attractive incentive to shut down early. The Asian Development Bank created a facility called the Energy Transition Mechanism or ETM to do just that. 

From the get-go, it was very unclear how this would actually work. One option was for the ETM to refinance the debt of privately owned coal power plants at a lower rate of interest. Lower interest payments would increase operating income, meaning shareholders could be paid back on an accelerated schedule and would then agree to shutter the plant early. In Indonesia, where the state-owned electric utility PLN owns and operates a large fleet of coal-fired power plants, an idea was floated to simply compensate PLN in exchange for shutting down some of its coal capacity.  

But when the investment roadmap was unveiled for Indonesia’s JETP, which is a $20 billion fund from foreign partners earmarked for clean energy investment, early retirement of coal-fired power plants was almost entirely missing. As it turned out, almost none of the foreign partners and lenders in the JETP were willing to do what was required to make these deals happen. Many countries have specified that financial commitments made under the JETP cannot be used for the early retirement of coal power. PLN’s proposal to close down 4,000 MW of coal capacity within seven years was basically rejected and the ETM is currently negotiating to retire two coal-fired power plants (one owned by PLN, one by private developers) with a combined capacity of 1,700 MW. If everything goes according to plan, the plants will cease operations in 2037 just a few years ahead of schedule. That hardly seems like a game-changer. 

See also  The Luzon Economic Corridor: A Badly-Needed Win For the US in Southeast Asia?

So why did this idea falter? The obvious answer is that if utilities are unwilling to unilaterally break contracts with owners and management of coal-fired power plants, then in order to induce early closure someone needs to buy them out. Cloak it in whatever language you want about just transitions and emissions reduction, but the bottom line is these entities are motivated by profit and they expect a certain return on their investment. If the goal is to reduce emissions by shutting them down early without breaking the contract, someone needs to pay. 

When confronted with this reality, hardly anybody wanted to pay. Many lenders balked because it is politically unpalatable to be seen doling out money to owners of coal-fired power plants. And while there may have been disagreement about how PLN was valuing its assets when determining compensation, the real head-scratcher here is that whoever came up with this idea of retiring coal-fired power plants early appears to have fundamentally misunderstood what they were proposing and what it would take to translate the idea into reality. 

Asia coal early faltering Power retirement Southeast
Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

‘Oracle of Omaha’: Warren Buffett Announces Retirement, Confirms Successor

May 4, 2025

Ending China’s De Minimis Exception Brings 3 Benefits for Americans

April 17, 2025

The Trump Tariff Shock Should Push Indonesia to Reform Its Economy

April 17, 2025

Tariff Talks an Opportunity to Reinvigorate the Japan-US Alliance

April 17, 2025
Add A Comment

Leave A Reply Cancel Reply

Top Posts

San Francisco State Student Government Blames ‘Violence’ on Riley Gaines, TPUSA

April 16, 2023

Wall Street Braces for the Great Loan Tightening: Credit Weekly

July 30, 2023

Former New York Giants Running Back Randy Minniear Dead At 79

August 21, 2023

UPDATE: Democrat Squad Member Jamaal Bowman Hurled Emergency Exit Signs on Floor Before Pulling Nearby Fire Alarm – a Dangerous Criminal Act – WHERE IS THE DOJ? | The Gateway Pundit

October 1, 2023
Don't Miss

EXCLUSIVE: ‘The Man She Is Today’: European Companies Accused Of ‘Importing’ Woke Ideology

Business May 29, 2025

Consumers’ Research issued a “Woke Alert” on Thursday warning American shoppers that three European companies…

‘The Economy Is On Fire!’: Kevin O’Leary Drops Fact Check On CNN Panelists Railing Against Trump’s Economy

May 29, 2025

DeSantis Signs Bill Making Gold And Silver Legal Tender

May 28, 2025

John Deere Announces $20 Billion Plan To Build Up American Manufacturing

May 28, 2025
About
About

This is your World, Tech, Health, Entertainment and Sports website. We provide the latest breaking news straight from the News industry.

We're social. Connect with us:

Facebook Twitter Instagram Pinterest
Categories
  • Business (4,136)
  • Entertainment (4,220)
  • Finance (3,202)
  • Health (1,938)
  • Lifestyle (1,645)
  • Politics (3,084)
  • Sports (4,036)
  • Tech (2,006)
  • Uncategorized (4)
  • World (3,944)
Our Picks

Health Care Workers Latest To Strike As Thousands Join The Picket Line

October 4, 2023

Chinese Regime Study Suggests Building Second Capital in Uyghur Region to Erase Identity

May 9, 2023

Fats found in breastmilk may provide answers to why breast is best

September 2, 2023
Popular Posts

EXCLUSIVE: ‘The Man She Is Today’: European Companies Accused Of ‘Importing’ Woke Ideology

May 29, 2025

‘The Economy Is On Fire!’: Kevin O’Leary Drops Fact Check On CNN Panelists Railing Against Trump’s Economy

May 29, 2025

DeSantis Signs Bill Making Gold And Silver Legal Tender

May 28, 2025
© 2025 Patriotnownews.com - All rights reserved.
  • Contact
  • Privacy Policy
  • Terms & Conditions

Type above and press Enter to search. Press Esc to cancel.