The government has decided to shift 3,960 MW of electricity from imported coal to Thar coal to avoid depleting the country’s expensive foreign exchange reserves by importing coal that is no longer available at reasonable prices.
The price of coal has risen to $400 a metric ton, according to a senior official at the Energy Ministry.
“The average per-unit cost of coal-based electricity used to be at Rs4-5 per unit, which has swelled to over Rs18 per unit, mainly because of an increase in imported coal price up to $400 per metric ton.”
The government has eliminated the POL subsidy and may raise the price of Mogas and diesel by implementing a petroleum fee on July 1, 2022, as required by the Fund.
The government would also raise local gas prices by 45 percent from July 1 as part of the $6 billion IMF package.
The government has decided to transform the Port Qasim Coal Power Plant, the Sahiwal Coal Power Plant, and the China Hub Coal Power Plant, each with a capacity of 1,320 MW of electricity, as a result of the current circumstances, according to the official.
As a result, the three imported coal-fired power plants can generate 3,960 megawatts of electricity.
“The Power Division has hired a firm for an assessment report on converting the imported coal-based electricity generation onto Thar Coal as fuel and the additional cost that will be incurred on the conversion, in one year’s time,” the secretary of the Power Division confirmed.
660 MWs of energy based on Thar coal are currently being added to the national grid, and another 660 MW facility in Karachi, the Lucky Power Plant, is being built using Thar coal as a fuel.
In the first 11 months of the current fiscal year 2021-22, the gasoline import bill has consumed about $20 billion.
Coal is a key source of energy, and it is used extensively in the power sector to generate electricity.
In general, local coal is utilized in industrial facilities and cement factories, whereas imported coal is used in power plants, cement factories, and other industries such as steel production.
Domestic coal production was around 9.3 million tonnes in FY2021, while coal imports were around 18.9 million tons.
Between July and February of FY2022, coal imports totaled 12.21 million metric tons.
Coal use in cement and other sectors has dropped dramatically from 37.6% in July-March FY2021 to 24.1 percent in July-March FY2022.
Overall coal consumption has climbed from 19.7% in July-March FY2021 to 31.4 percent in July-March FY2022.
The electricity industry consumes the majority of coal, and its share climbed to 44.5 percent in July-March FY2022 from 42.7 percent the previous year.
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