IPPs to consult Thar Coal Energy Board before procuring coal

By Tahir Ali | Gwadar Pro Jan 3, 2023

ISLAMABAD, Jan 3 (Gwadar Pro)- National Electric Power Regulatory Authority (NEPRA) of Pakistan has issued guidelines for all imported-coal-based Independent Power Producers (IPPs) to use local coal such as Thar coal which fulfills their “desired specs” and in case of unavailability, the IPPs shall progress with spot purchase with the currency of the contract be in Pak rupees.

As per the guidelines for the ‘Procurement of Coal on Spot Basis’, the coal power plants shall ensure that the procurement of coal on a spot basis is conducted fairly and transparently.

The imported coal-based IPPs shall first ensure whether local coal such as Thar coal is available and can be used keeping in view plants’ “technical requirement”. IPPs shall estimate the total quantity/quality of coal to be procured in the next six months and shall contact Thar Coal Energy Board (TCEB) and seek their input regarding the availability of Thar coal from any of the blocks. If no local coal is available which meets the desired specs, then IPPs shall progress with spot purchases as per this mechanism.

The delivered cost of coal is Rs. /MMI3TU, which should remain lower than the imported coal on the basis of API4/ICI3 as the case may be. In case, the delivered price of coal on spot is more than the imported coal, then the price of imported coal shall be used.

In the case of China Power Hub Generation Company Limited, to calculate the ceiling price for comparison, marine freight shall be calculated on the basis of Supramax vessels during the Monsoon period. However, during the non-monsoon period, freight shall be calculated on the basis of Panamax vessels.

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