Climate Change Data

Environmental Metrics

ESG Focus Areas

• Occupational Health, Safety and Environment (OHSE)
• Corporate Social Responsibility (CSR)
• Good Corporate Governance (GCG)

Environmental Achievements

• Mangrove planting program to reduce abrasion.
• Implementation of strict health and safety standards.
• Environmental impact analysis conducted every semester.
• Establishment of WWTP (Wastewater Treatment Plant)

Social Achievements

• Blood donation program.
• Support for sports activities.
• Distribution of masks related to haze disaster.
• Donations for orphans and Eid al-Adha sacrifices.
• Assistance to the Orang Utan Foundation.
• Road repair assistance in areas nearby the power plant.
• Most of CNKO's site employees at PLTU Pangkalan Bun are local residents.

Governance Achievements

• Consistently implemented good corporate governance (GCG).
• Consistently fulfilled commitments to customers with excellent achievements.
• Successfully recorded an operating profit for the first time since 2013.
• Implementation of integrated risk management went well, with no unmitigated risks.

Climate Goals & Targets

Environmental Challenges

• Unstable global economic conditions and lack of improvement from the previous year.
• Slowdown in global economy resulting in restrictions on coal imports.
• Over supply of global coal putting pressure on coal prices.
• Over supply in domestic market due to increased production by coal mining companies.
• COVID-19 pandemic causing decrease in electricity demand and impacting coal demand.
• Competition with domestic and foreign coal suppliers.
• Risk of proven and probable reserves adjustments impacting development and mining plans.
• Changes in Indonesian mining laws and regulations.
• Significant environmental costs.
• Failure to maintain good relations with the local community.

Mitigation Strategies

• Streamlining operations and increasing efficiency.
• Focus on fulfilling contract obligations to PLN.
• Improvement of supporting infrastructure in PLTU and port sectors.
• Revitalization of port in Kintap.
• Ensuring investments provide adequate returns.
• Divesting ownership of subsidiary PT Dwi Guna Laksana Tbk.
• Continuous implementation of GCG and risk management.
• Careful operational activities to avoid potential losses.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Weather conditions (rainy season)

Transition Risks

• Changes in laws and regulations
• Competition

Reporting Standards

Frameworks Used: Good Corporate Governance (GCG)

Environmental Metrics

ESG Focus Areas

• Occupational Health, Safety, and Environment (OHSE)
• Corporate Social Responsibility (CSR)

Environmental Achievements

• Established a Waste Water Treatment Plant (IPAL)
• Implemented a mangrove planting reforestation program
• Conducted regular Environmental Impact Analysis (AMDAL) activities
• No significant OHS incidents reported

Social Achievements

• Distributed disinfectant liquid, masks, and basic necessities to local communities and onsite workers
• Participated in blood donation activities, donations for orphans, Eid al-Adha sacrifices, and financial assistance for religious building construction (mostly with PLN)

Governance Achievements

• Consistently implemented good corporate governance (GCG) principles and practices across all business lines
• Conducted regular meetings, socialization, and training in GCG (virtually in 2020)
• Integrated risk management ran smoothly with no disruptions to business continuity

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic causing global economic crisis and reduced demand for electricity
• Lower demand for coal from China and India (though increasing towards year-end)
• Lowest HBA in 6 years (USD 58.2/ton)
• Domestic market obligation (DMO) for coal only reached 85% of target
• Closure of port operations in Q3 2020 due to lack of demand
• Various industry and operational challenges

Mitigation Strategies

• Implemented strict health protocols to prevent COVID-19 spread (no clusters reported)
• Continued efficiency enhancement programs across all operational activities
• Maintained focus on fulfilling coal supply obligations to main client (PLN), receiving an 'excellent' rating
• Continued infrastructure improvement and maintenance of Pangkalan Bun PLTU

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Weather and climate risk (rainy season impacting mining and port operations)

Reporting Standards

Frameworks Used: Indonesian Financial Accounting Standards (SAK)

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduction in costs related to energy consumption (transportation, loading/unloading, fuel, shipping)
• Reduction in emissions due to efficiency policies (business trips reduction)
• Waste and effluent reduction in PLTU operations (air and water quality within environmental limits)
• Maintenance of biodiversity (surface water quality parameters meet government criteria)

Social Achievements

• Equal employment opportunities, gender equality, no child or forced labor
• Fair remuneration policies considering regional minimum wages
• Safe and decent working environment
• Continuous employee training and development
• Positive community impact (improved electricity supply, easier social activities, increased livelihoods)

Governance Achievements

• Implementation of good corporate governance (GCG) principles (transparency, accountability, responsibility, independence, equality)
• Regular meetings of the Board of Commissioners and Audit Committee
• Appointment of independent auditor (KAP Suharli, Sugiharto & Rekan)

Climate Goals & Targets

Environmental Challenges

• Technical problems at PLTU Pangkalan Bun (reduced performance)
• Pandemic impact (efficiency measures needed)
• Gap between coal demand and supply in Indonesia
• Weather disturbances affecting production
• Dependence on PLN for revenue with limited selling price
• Competition in the Indonesian energy sector
• Potential environmental costs
• Maintaining good relations with local communities
• Limited employee understanding of sustainable finance

Mitigation Strategies

• Efficiency measures to reduce operating expenses
• Increased coal supply volume to PLN
• Complete shutdown of PLTU for thorough analysis and repair
• Implementation of health protocols (5M scheme, WFH)
• Environmental monitoring (air, water, noise levels)
• CSR activities (blood donation, religious activities, social assistance)
• Development of a Sustainable Finance Action Plan
• Training and capacity building in sustainable finance

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather (affecting coal production and transportation)

Transition Risks

• Changes in regulations related to coal mining and power generation

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Construction of a Wastewater Treatment Plant (WWTP) so that the quality of the waste water from the combustion process meets the requirements to be discharged into the river.
• Reforestation program to reduce abrasion by planting mangroves.
• Annual routine Environmental Impact Assessment (AMDAL) activities covering water, air and soil quality.

Social Achievements

• Equal employment opportunities for all employees, gender equality and no forced labor or child labor.
• Policies in providing remuneration to employees that take into account regional minimum wage policies.
• Providing a decent and safe working environment.
• Providing continuous training and development to all employees.

Governance Achievements

• Implementation of good corporate governance (GCG) applied thoroughly in every line of organization.
• Continued fulfillment of compliance aspects, including information disclosure, improvement of related internal procedures, and internal GCG socialization.
• Implementation of integrated risk management.

Climate Goals & Targets

Environmental Challenges

• High global coal prices creating challenges for the domestic market.
• Technical problems at the PLTU resulting in operational halts.
• Pandemic challenges requiring continued implementation of health protocols.
• Government plans for clean energy transition impacting long-term prospects.

Mitigation Strategies

• Investment in replacement spare parts for PLTU.
• Continued focus on fulfilling coal supply commitments to PLN.
• Implementation of hybrid work from home and work at office schemes.
• Exploration of entry into the renewable energy sector.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Weather conditions, especially the rainy season, affecting mining and port activities.

Transition Risks

• Government plans for clean energy transition.

Opportunities

• Exploration of renewable energy sources.

Reporting Standards

Frameworks Used: POJK No.51/POJK.03/2017

Awards & Recognition

• Special award from PLN in 2022 for performance and contribution in coal supply.