Thar coal-based power plant starts commercial operations

KARACHI: A 330 megawatts (MW) power plant based on Thar coal has begun commercial operations, with an aim to generate low cost energy and help the country cut its energy import bill.

The development was shared by Hub Power Company Limited (HUBCO) in a bourse notice on Friday, in respect of its associated company, ThalNova Power Thar (Private) Limited (TN).

“The project has successfully achieved commissioning, with the commercial operations date (COD) to take effect from February 17, 2023, in terms of the power purchase agreement dated July 21, 2017 (the “PPA”) entered into between TN and the Central Power Purchasing Agency (Guarantee) Limited,” HUBCO notice to the Pakistan Stock Exchange stated.

TN is a joint venture between

Hub Power Holdings Limited (a wholly owned subsidiary of HUBCO), Thal Power (Private) Limited, Nova Powergen Limited, CMEC ThalNova Power Investments Limited, and Descon Engineering Limited.

They established the 330MW mine-mouth coal-fired power generation complex at Thar Block II, District Tharparkar, Sindh, Pakistan under the China Pakistan Economic Corridor.

“The project will be generating low cost energy from indigenous Thar coal thus reducing burden on national foreign exchange resource,” the notice read.

With the latest achievement, the collective power generation capacity of HUBCO and its group companies has increased to 3581MW through its plants spread over Balochistan, Punjab, Azad Jammu and Kashmir, and Sindh.

Pakistan plans to quadruple its domestic coal-fired capacity to reduce power generation costs and will not build new gas-fired plants in the coming years, as it seeks to ease a crippling foreign-exchange crisis, according to Reuters.

“LNG is no longer part of the long-term plan,” Pakistan Energy Minister Khurram Dastgir Khan told the new agency, adding that the country to increase domestic coal-fired power capacity to 10 gigawatts (GW) in the medium-term, from 2.31GW currently.

Power generation on Thar coal stands as the second cheapest source among the plants operating on various fuels including gas, RLNG, and oil in the country, according to the latest merit order issued by the National Transmission and Despatch Company on February 16, 2023. The power production on Thar coal Block-1 costs Rs4.3 per unit (kilowatts per hour) at present, while high-speed diesel is the most expensive fuel used to produce electricity.

Pakistan has approximately 175 billion tonnes of coal reserves in Tharparkar alone.

The deposits, 16th-largest coal reserves in the world, were discovered in 1991 by Geological Survey of Pakistan and the United States Agency for International Development.

Earlier this month, Private Power and Infrastructure Board has also announced achievement of COD of the country’s largest Thar coal-based power project located at Thar Block-1, having a generation capacity of 1320MW. The project was developed by Thar Coal Block-1 Power Generation Co., a fully owned subsidiary of Shanghai Electric. Total production of electricity from Thar coal-based power generation plants has now reached 3,300MW.