ISLAMABAD - Pakistan Power and Infrastructure Board (PPIB) on Tuesday issued Letter of Interest (LOI) to China Communications Construction Company Limited (CCCC) for development of 300MW imported coal-fired power project at Gwadar.
The documents in this regard were signed by PPIB Manging Director Shah Jehan Mirza and CCCC Vice President Xu Jun. Under the plan, M/S CCCC would develop the 300MW power project utilising imported coal at Gwadar, Balochistan. The estimated cost of the project is $600 million and it is part of flagship China-Pakistan Economic Corridor (CPEC). Gwadar Port Authority (GPA)/Gwadar Development Authority (GDA) is the supervising agency. It was agreed that the company will obtain tariff approval from Nepra and start construction after achievement of financial closing. The said project has been approved by the Joint Cooperation Committee (JCC) of CPEC and PPIB Board for further processing.
With the addition of 300MW Gwadar Power Project, the portfolio of power generation projects being processed by PPIB has number to nine coal based projects of 8220MW and three hydro based projects of 2714MW constituting aggregate total of 12 projects of 10934MW under the CPEC.
The economic activities foreseen at Gwadar in the near future would require a reliable power supply which is possible only with the installation of energy generation plant locally, however instead of using environment-friendly fuel the government has decided to run it on dirty fuel. While the world is busy saying good bye to coal based electricity, the government of Pakistan is bent to install coal power plant at Gwadar port.
It is pertinent to mention here that Federal Minister for Planning Ahsan Iqbal had earlier ordered the switching over of Gwadar coal power plant to oil/LNG. In this regard, Ahsan also showed discontent over the Ministry of Water and Power for making delay in formulating plan for switching the proposed Gwadar coal based power plant from coal to cleaner fuel. The minister had even directed the concerned ministry’s officials to finalise the conversion plan from coal to oil/LNG within one week.
As per the earlier stand of the government, the move of switching over the power plant from coal to cleaner fuel was taken because the proposed power plant is of subcritical coal technology which will pollute the environment of the new developed port. The coal power plant of 600MW is being developed with super critical technology which is relatively environmentally safe; however 300MW power plants don’t come in super critical technology. However, all of the sudden the decision was changed and now once the government claims that environment-friend technology will be installed at Gwadar.
Globally there is move against the use of coal in power generation and the number of coal-fired power plants in pre-construction stage fell by almost 48 percent in 2016. Several countries, particularly China and India, dropped hundreds of coal based projects. Earlier in 2016, China has cancelled or put on hold 100s of under construction/planned coal fired projects. Over all, china use of coal is on decline since 2013. Similarly, the United States has shifted to gas, wind and solar as the country has retired 13 gigawatts in 2015. In India, banks have refused to finance the coal fired projects and resultantly the government has to put around dozen coal fired projects on hold.
However, a good was seen here in Pakistan too as in February Pakistan and China agreed to remove coal projects from the CPEC portfolio. The projects which were dropped includes Muzaffargarh Coal Power Project (1,320MW), Salt Range Mine Mouth Power Project (300MW) including mining, Gaddani Power Park (1,320MW