According to reports, Semen Indonesia is partnering with JFE Engineering Corp on a waste-to-heat power project in East Java. With an investment of Rp.638 billion, the plant will reportedly cut Semen Indonesia’s annual electricity costs by around US$10 million when it comes on-stream at the end of 2016.
Power costs are a major part of any cement operation’s total costs, and state-owned electricity company PT Perusahaan Listrik Negara announced plans earlier this year to increase tariffs for industrial users by up to 38%.
Last week it was reported that Indonesia’s cement sales have fallen below target in the first half of this year, growing 3.9 percentage points y/y, which is below the growth target of 6%. The Chairman of the Indonesian Cement Association said that he hopes the second half will show an improvement. It is likely that the elections have impacted demand, as construction projects are put on hold while businesses wait for greater economic certainty.
Meanwhile, at the end of June, Semen Indonesia signed a Memorandum of Understanding with FLSmidth. According to Semen Indonesia’s website, the MoU outlines how synergies between the activities of Semen Indonesia and FLSmidth, as well as their individual strengths, can be leveraged by both sides to provide mutual benefit and competitive advantages. During the signing ceremony, both companies agreed to share the responsibility for further developing their long-term partnership and constantly seeking opportunities together – leading to an even stronger and more beneficial alliance. More details of the MoU can be found on FLSmidth’s website.
Edited from various sources by Katherine Guenioui
Read the article online at: https://www.worldcement.com/asia-pacific-rim/15072014/semen_indonesia_plans_waste_to_power_project_94/