Freight Calculation Model: A Case Study of Coal Distribution

Abstract

Coal has been known as one of energy alternatives that has been used as energy source for several power plants in Indonesia. During its transportation from coal sites to power plant locations is required the eligible shipping line services that are able to provide the best freight rate. Therefore, this study aims to obtain the standardized formulations for determining the ocean freight especially for coal distribution based on the theoretical concept. The freight calculation model considers three alternative transport modes commonly used in coal distribution: Tug-barge, vessel and self-propelled barge. The result shows there are two cost components very dominant in determining the value of freight with the proportion reaching 90% or even more, namely: Time charter hire and fuel cost. Moreover, there are three main factors that have significant impacts on the freight calculation, which are waiting time at ports, time charter rate and fuel oil price.