Thar coal most affordable power generation source in country: CM

KARACHI: Sindh Chief Minister Syed Murad Ali Shah said on Monday Thar coal is the most affordable source of electricity generation in the country, but due to transmission constraints, there are instances when the delivery of this inexpensive power is hindered, preventing its full potential from being realised.

“Since 2019, 27,000 GWh of electricity has been generated from Thar Coal Block-II at a significantly lower fuel price of Rs4.8 per kWh, compared to Rs19.5 per kWh for imported coal, which has resulted in a foreign exchange saving of approximately $1.3 billion.”

During the 28th Thar Coal Energy Board meeting Shah chaired at the CM House, he stressed that Thar Coal represents the most economical source of electricity generation within the country, and it is also locally sourced.

“Despite its cost-effectiveness, the evacuation of power from Thar faces challenges due to transmission limitations,” he said, adding that the federal and provincial governments are working in collaboration to improve Thar’s electricity evacuation infrastructure to mitigate the overall electricity costs for the nation to truly benefit from the local source.

The CM said Thar has successfully generated 2,640 MW of power, positioning it as the most affordable energy source in the country, thereby supplying electricity to over six million households.Federal Power Secretary Fakhre Alam said the prime minister has issued directives for the conversion of the Jamshoro, Sahiwal, Port Qasim and Hub power plants to Thar coal for imported coal substitution.

Alam said a study would be conducted before converting them to imported coal. Shah said that once the railway line is laid, transportation of coal from Thar to upcountry would be easy and cheap.

During the presentation on the railway line, the meeting was informed that the contract to lay the rail track from the Thar coalfield in Islamkot to Chhor, a distance of 105km, has been awarded to the Frontier Works Organisation.

Earthwork is currently in progress, and sleepers have been procured. The procurement of rails and fastening materials has also begun. A 9km rail track is being developed from Bin Qasim to the Lucky Power Plant, and a coal unloading facility for the Lucky Electric Power Company at Port Qasim.

A total of 756.1 acres has been identified for the project, of which 36 acres is private land that still needs to be acquired. Shah directed Chief Secretary Asif Hyder Shah to instruct the Mirpurkhas commissioner to proceed with the land acquisition.

CS Shah said that 242.12 acres of private land in Tharparkar is being acquired, for which Rs60.8 million has been allocated to the Mirpurkhas commissioner.A railway line is expected to be completed by December 2025, with the establishment of a special purpose vehicle. The site clearance work is already in full swing.

The meeting also approved the recommendations for the indexed and adjusted tariff order concerning the motions for determining the indexations/adjustments of the tariff for the period from October 2022 to March 2024, submitted by the Sindh Engro Coal Mining Company (SECMC) for Phase-II of the mine at Block-II in the Thar coalfield.

The meeting also approved the extension of the Thar Coal Tariff Determination Committee members, and board directors Dr Fahad Irfan Siddiqui and Ammar Habib Khan until August 2025.

The SECMC CEO said Chinese lenders are willing to support the expansion of the Block-II mine, increasing its capacity from 7.6 to 11.2 million tonnes per annum.He said a financial close is expected to be achieved by the first quarter of 2025. The expansion will be financed locally, and a term sheet has already been signed with the Meezan Bank to arrange the necessary funding, he added.