PT SK KERIS S STRATEGY FACING OF FUEL PRICE INCREASING THROUGH ENERGY SOURCE DIVERSIFICATION (GAS) CASE STUDY - POWER PLANT

• Main Author: Osmal Yuniver Simatupang (NIM 291 05 140), Erwin
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/6077
• Institution: Institut Teknologi Bandung

Abstract : <br /> <br /> <br /> <br /> <br /> <br /> <br /> The increasing price of fuel in Indonesia, which was triggered both by international and local situation brought a bad impact to local industry. In Indonesia the price increase was initiated by the withdrawal of Indonesian government subsidy that had been enjoyed so far by industrial community. The withdrawal was implemented partially started from 2001. After the withdrawal was implemented fully by 2005, the price was determined by international price which was reviewed monthly. PT SK KERIS is one of Foreign Direct Investment industry in Tangerang which produce PET and Polyester. The plant use IDO as fuel for their power plant with utilization of 100,000 liter/day and average output of 17,500 kW (18,500kW at peak load) and also for their boiler in PET process with utilization of 25,000 liter/day (total 125,000 liter/day). As such, PT SK KERIS was also impacted from the fuel price increase. The fuel price increase consequently will increase production cost and will also impacted negatively on the competitiveness of their final product. PT SK KERIS management anticipates this condition with cost leadership strategy by initiating utility re-structuring activity which is a program to diversify energy source other than IDO. To facilitate this program the management formed a Task Force Team (TFT), aptly named TFT for Utility Re-Structuring which members consist of inter-department functions such as utility, CR, finance, purchasing and logistic, and maintenance team. The team was also supported by SK Korean staff technical experts, which was located in Indonesia as well as in Korea as consultants. The TTF did a feasibility study for three alternatives of energy source, which were coal, gas and electricity from PLN. The team decided to choose gas as its energy source alternative based on several considerations. One of the main considerations is environmental factor, to be aligned by management directions. The chosen technology was dual fuel diesel engine, which use 70% gas and 30% IDO as a short-term program until 2005. The long term project will be all-gas engine, to be implemented start from 2006 and scheduled to be finished by 2008. To achieve management target in schedule and performance, TFT conduct several important steps. One of them was determining critical path map and solution. This step was conducted together with PT Parba Nusantara as piping and bridge contractor, PGN as the owner of the main line piping project and PT Bukaka as the contractor for the dual fuel. Until the finalization steps of the project, either in the dual fuel project and the first steps of gas engine there were no major problem and working accident. Financially, in 2006 the project could save electrical cost of US$ 8,848,258 (40% of total saving) and US$ 3,221,132 for PET boiler (60% of total saving). The total saving was calculated to reach US$ 27,587,146 or 44%. Based on the project steps and its achievements, it can be concluded that PT SK KERIS management had chosen and implemented a correct strategy. It was recommended to continue the project to next stages.