Ahmed Khan Malik

The 660MW Jamshoro power plant has long been running on imported coal to generate energy though the southwestern Sindh province is endowed with huge reserves of coal, reports WealthPK. The plant’s preference for imported coal is bleeding the country’s already depleting foreign exchange reserves. The plant is situated in Mohra Jabal five kilometers northwest of Jamshoro village on the Indus Highway around 18 kilometers from the center of Hyderabad. Pakistan is facing a high cost of fuel for electricity production, and it needs to use more local fuel than imported fuel for power generation. The Jamshoro power plant has taken this initiative. AsiaPak Investments has submitted an investment plan to replace the imported fuel used by this supercritical power plant with indigenous Thar coal for the next 30 years. The power plant, which was financed by the Asian Development Bank (ADB) with $545 million, had its operation stalled for the last one and a half years due to the shortage of imported coal caused by the dollar crunch.

Shahriar Chishti, Head of AsiaPak Investment, said a proposal for conversion of the plant is already on the government’s table and they are optimistic that the government will give its green light anytime to go ahead with the project. He hoped that the plant will begin its commercial operations (CoD) from indigenous Thar coal by September next year if the government approves their investment plan. The plant will generate around 5 billion units per year, and will bolster provision of electricity in Karachi – the commercial hub and revenue engine of Pakistan. AsiaPak, which is also one of the shareholders in Thar Block-1 and KE, has offered financing for conversion of the project. The modification project will cost $50 million, which is less than 10 percent of the project’s total cost, he said. The daily coal demand of the plant is around 8,000 tons, or some 250 trucks, per day from Thar Coal Block-1. Thar coal mines have a huge capacity to supply. A 100-km rail link will also be developed from Thar Mine site to Chhore, while the rail track from Chhor to Jamshoro plant is already intact.

The Chhor to mine site rail link is very important and the Sindh government has already informed the federation that it will finance this project. Perhaps, some Middle Eastern investors have also expressed their desire to finance the track.  According to a study by the Asian Development Bank, acute power shortages have crippled economic growth causing social unrest in Pakistan over the years. The country needs affordable, dependable base-load power to alleviate the shortage. Coal-fired power plants provide secure, inexpensive base-load power in many countries. The project introduces supercritical coal-fired power generation, which is the best available technology for Pakistan. Pakistan is exploring all options to reduce load shedding and the power cost but has few medium-term options for an affordable, dependable power supply. The country used to rely on natural gas as the main fuel for base-load power plants, but its gas reserves have been declining. This has forced the country to use more expensive imported fuel oil for power generation, which has increased the cost of electricity and affected the households and the economy.

Credit: INP-WealthPk