PD identifies coal discount gaps causing Rs380mn annual losses to Pakistan

According to Business Recorder, the Power Division (PD) has found inefficiencies in the way power plants procure imported coal and has issued policy guidelines to correct them. The changes could save the government up to Rs380 million a year. The findings emerged from senior-level meetings led by Federal Minister for Power Sardar Awais Ahmed Khan Leghari, where officials checked actual data and contracts instead of relying on outside reports.

The PD noted that coal-fired plants with roughly 5,280 megawatts of capacity depend fully or in part on imported fuel, among them three 1,320 MW units at Port Qasim, Hub Power and Sahiwal. Although import prices follow an international benchmark, what a plant actually pays depends on the discount it secures from its supplier. The review found that plants buying from the same supplier against the same benchmark received discounts spanning $0.25 to $7.12 per metric ton.

Under the first phase of reform, plants must buy from the contracted supplier offering the highest discount and cannot purchase from those offering less. Formal guidelines are being passed to NEPRA so that it can push for more openness and rivalry in coal buying. The PD estimates annual savings of about Rs380 million with no extra investment, while Leghari stressed efficiency and transparency rather than interference in commercial operations.