Indonesian President Joko Widodo has signed a government regulation authorising the energy and mineral resources minister to set the price of coal for the domestic market, Coal and Minerals Director-General Bambang Gatot said.
Further details on the pricing plan will be outlined in a ministerial decree expected to be announced soon, Gatot told parliament on Wednesday, declining to comment further.
Indonesia plans to keep electricity tariffs and fuel prices unchanged this year and the next by hiking subsidies, government officials said earlier this week.
Perusahaan Listrik Negara (PLN) Chief Executive Sofyan Basir urged Widodo last week to fix domestic coal prices at between $60 and $70 per tonne for two years.
Indonesian domestic media reported on Friday that the energy ministry has agreed to set prices at $70 per tonne.
Indonesian Coal Benchmark Price (HBA) was set at $101.86 per tonne for March, its highest since May 2012.
The government has been working on plans to regulate domestic coal prices since late 2017, and the discussions have impacted some coal miners’ share prices.
PT Adaro Energy fell 7.3 percent to close at 2,160 rupiah ($0.1570) per share on Wednesday, while Bumi Resources was down 6.3 percent, Indika was down 7.4 percent and Harum Energy was down 6.2 percent.
The declines among coal miners helped pull Indonesian shares down 2 percent on Wednesday, their sharpest fall in nearly four months.