ISLAMABAD: The Sindh government has requested a concessional electricity tariff to transition Thar coal mines operations from High-Speed Diesel (HSD) to grid power, aiming to enhance sustainability and cost-efficiency.
Sources told Newzshewz that in a letter to Power Minister Sardar Awais Leghari, Sindh Minister for Energy Syed Nasir Hussain Shah highlighted a proposal by Sindh Engro Coal Mining Company (SECMC), which is proactively supported by the Sindh government. The proposal offers a viable technical, financial, and regulatory solution that aligns with the collective goal of sustainable energy development in Pakistan while increasing power utilization from the national grid and reducing the financial burden on the national exchequer.
Currently, SECMC relies heavily on imported High-Speed Diesel (HSD) to power its 7.6 MTPA lignite Thar coal mining operations. This reliance significantly escalates operational costs and, consequently, coal prices. It also places a considerable strain on the country’s foreign exchange reserves. Importing diesel further drains precious foreign currency reserves, which could be conserved through the optimization of existing resources.
To address this challenge, SECMC has requested support for shifting Thar mines operations to a more sustainable and cost-efficient power source. The plan also includes SECMC’s immediate expansion of production capacity from 7.6 MTPA to 11.2 MTPA, with further expansion to 20 MTPA in the coming years.
To assess the feasibility of this transition, SECMC engaged Power Planners International, a renowned power sector consultancy, to conduct a comprehensive study titled “Feasibility Study on Providing Electric Supply for Mining Operations in Thar.” The study, based on data permissions from NTDC and HESCO, evaluates several interconnection options for supplying sustainable electricity to SECMC’s mining operations.
The study considers three potential interconnection options for SECMC’s load, which is currently 10 MW and projected to rise to 43 MW by 2028: (i) connection to 500 kV Thar circuits through a dedicated grid station ;(ii) connection to 132 kV HESCO circuits from Islamkot, Mithi and ;(iii) connection to Thar Block-2 from Independent Power Producers (IPPs).
According to the Sindh Minister for Energy, the first option—connecting to the 500 kV Thar circuits through a dedicated grid station—is considered the most reliable and sustainable solution, provided a discounted tariff is applied. This option involves integrating Thar Block-2 with a nearby transmission line, located 5 km from the mining site, along with some necessary infrastructure reinforcements.
The project’s implementation timeline is estimated at 18-22 months. Regulatory approvals are expected to take 6 to 10 months, while technical installations and commissioning will require approximately 12 months. A Use of System Agreement with NTDC/DISCO will also be necessary. The final tariff, preferably based on energy costs, will be determined by the relevant authority based on a bilateral contract between SECMC and the competitive supplier.
The Sindh Minister for Energy has called on the Federal Minister for cooperation to expedite the necessary approvals and coordination with relevant authorities to ensure the swift advancement of this transition.
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