An executive with the Indonesian Chamber of Commerce and Industry (KADIN) has underscored the enduring importance of coal in maintaining Indonesia’s energy security despite rising challenges from other and environmentally friendly energy sources.

“Food security, energy security, and water security are the top priorities of President Prabowo Subianto’s administration. Coal will always be a crucial part of Indonesia’s energy resilience. Business players must not overlook this industry’s real contribution to the national economy,” Aryo Djojohadikusumo, Vice Chairman for Energy and Mineral Resources at the Indonesian Chamber of Commerce and Industry (KADIN), said at the Energy Insights Forum in Jakarta on Wednesday, September 17, 2025.

According to Aryo, coal’s role in Indonesia’s economy is too significant to ignore, both as a major energy source and as a contributor to state revenues.

“This sector pays taxes, helps build schools and hospitals, and supports infrastructure development. Its contribution is immense,” he added.

Aryo emphasized that while environmental, social, and governance (ESG) concerns continue to gain momentum, coal remains indispensable, providing substantial state revenue, employment opportunities, and social infrastructure. Over the past three years, coal’s fiscal contribution has consistently outperformed the oil and gas sector.

Data from the Ministry of Energy and Mineral Resources (ESDM) shows that by the first half of 2025, non-tax state revenue (PNBP) from minerals and coal reached Rp74.2 trillion (US$4.74 billion), or 59.5 percent of the annual target − up 1.1 percent from the same period last year.

However, the sector is also facing mounting pressures. As of August 2025, national coal production stood at 485.71 million tons, just 65.72 percent of the annual target, marking a 12.14 percent year-on-year decline. Exports were also down by around 11 percent year-on-year, while global prices continued to weaken due to oversupply in China.

In addition to external pressures, the industry is grappling with domestic challenges, including the proliferation of illegal mining, rising production costs, and frequently shifting regulations.