PAGE Blog Business Weekly Magazine
At present 50 percent of world’s electricity is being generated from coal and it is the one largest contributor to world electricity generation. By looking at the electricity generation mix of the countries that are blessed with coal, it is evident that coal is the largest contributor. It has been estimated that there are above 847 billion tonnes of proven coal reserves throughout the world. It is anticipated that at the present level of coal production, the coal reserves are to last for a period of over 130 years. On the other hand the proven oil and gas reserves are to last around 42 and 60 years respectively at current production level. Coal reserves are available in around 70 countries.
Pakistan’s share of coal in the energy sector is negligible. For generating electricity it depends primarily upon oil (43 percent) followed by natural gas (38 percent) and hydro electric power (10 percent). It is anticipated that the demand for thermal coal and coking coal by power and steel sectors, respectively, will gain momentum in near future.
According to the World Energy Statistics 2011, published by the International Energy Agency (IEA), Pakistan’s per capita electricity consumption is one-sixth of the world average. World average per capita electricity consumption is 2,730 kilowatt hours (kwh) compared to Pakistan’s per capita electricity consumption of 451 kwh.
Share of coal on the energy sector is around 48 percent in the universe. China share of coal in the energy sector stood at 70 percent and 50 percent by India. Japan where 28 percent electricity is generated using coal is the world’s largest steam coal importer. In Denmark also about 46 percent electricity is generated from imported coal. The largest proved recoverable reserves of lignite coal in the globe are in Australia followed by USA and China. Total Lignite Coal Reserves are estimated to be 150 billion tonnes.
In the past 50 years, coal has represented the country’s primary energy consumption. It is recognized that coal will, in principle, remain China’s principal energy source in the future. All types of coal have been searched, mostly low sulfur, low to medium ash content, and medium to high thermal.
Coal is the most significant and ample fossil fuel in India. It accounts for 55 percent of the country’s energy need. The increasing demand of India for energy for supporting the economic growth is met by a combination of renewable, nuclear and conventional sources of energy while India aims to double coal production in five years. Recently, the energy minister of India had targets a billion tonnes of coal in 2019 to meet soaring electricity demand. About 500 million tonnes hopefully this year, and a billion tonne in 2019. The size of Indian coal industry was estimated at Indian rupee 800 billion by the end of fiscal year 2012.
Coal is mined in every state in Australia and it plays a key role in the country’s economy. According to the Australian Coal Association, coal is the country’s largest single export with markets in China, Japan, Korea and Taiwan. Coal is also used to generate more than 80 percent of Australia’s electricity. The coal industry in Australia employs 130,000 people.
Investment interest
Coming back to Pakistan, there are sufficient coal reserves available to generate cheap electricity and gas for meeting rising demand of the country and the region. Coal reserves can provide electricity to the country for more than 500 years. Pakistan’s Thar Coal project would lead to vast investment from the leading international companies. Foreign companies are willing to participate in the coal project. With the completion of coal projects, the nation would get relatively low and abundantly power supply in settling the current energy crisis.
Unexploited coal reserves must be tapped to address the Pakistan’s energy crisis. The country must turn to coal to ease the energy crisis, which is blocking the economic growth, trade, commerce and industry. Imports of low-grade coal are likely to be part of the very short-term solution with the development of Thar — a longer-term prospect. Some converted plants are co-firing coal with biomass from rice husks or waste car tyres and blending imports with local coal but the need for more imports will remain as more independent power plants develops and sugar, textile and steel mills shift to coal at their captive plants.
According to the Pakistan Energy Year Book 2011, the country’s installed power generation capacity is 22,477 megawatts and demand is more or less the same. Pakistan in this context needs to restyle the electricity function and replace oil and gas with sufficiently available indigenous fuel source. It must develop indigenous energy resources to meet future electricity needs and can overcome energy crisis by utilizing unexploited coal reserves.
Luckily, Pakistan has a very inexpensive source to get energy through coal. Coal is now economically feasible and a long-term solution to balance the demand and supply chain of electricity in the country, which has the fifth largest coal deposits in the world.
According to last estimates made in 2011, coal deposits in the country are up to 185 billion tonnes. The largest deposits are in Thar Desert, which are about 850 trillion cubic feet and are spanning over 10,000 square kilometers, astonishingly more than the oil reserves in Saudi Arabia having a collective quantity of approximately 375 billion barrels.
Electricity availability for 40 years
Coal reserves of only Thar can generate 20,000MW of electricity for the next 40 years and without load shedding. According to coal experts only 2 percent utilization of Thar coal can produce 20,000 megawatts of electricity for 40 years. To develop the Thar coal for energy purpose huge investment is required initially. A long time back, the coal reserves could have been utilized productively but unfortunately the strong lobby for oil import was opposing tooth and nail both inwardly and somewhat outwardly the utilization of Thar Coal for generating electricity.
Available information shows that the 450 megawatt coal power plant based on Lakhra Coal field is one of the possible options to produce extensive electricity. Lakhra Coal Development Limited has 44 coal mines fully developed capable of producing 50 tonnes of coal per day. Average annual production is one million tonnes. Most of the production is used in the Wapda power plant at Khanote (Sindh) and in brick kiln industry. Imported coal is being mostly used in Pakistan Steel Mills and in some cement plants.
All this does not mean that abundant Thar coal reserves have to be ignored at all cost. Taking into circumstances the current energy shortage and difficulty in getting at exorbitant rates imported oil and gas the use of indigenous Thar Coal for generating energy cannot be ignored. It is a very good sign that famous professional company like Engro Pakistan has come forward with great zeal to help in generating electricity from Thar Coal field.
But since, very little progress has been made in the Thar Coal project development. Five coal projects completely abandoned after the disruption of 6600 MW Gaddani project. After abandoning 6600MW Gaddani coal power project, work on proposed five coal power projects of Punjab province has been stopped in the wake of little or no interest shown by potential investor. At present only 1,320 MW coal power plant is under construction at Port Qasim, while 1,860 MW coal power project is expected to be launched at Thar and 660 MW by Engro Power is under consideration. Also China Power Holding International is considering 1,200 MW coal power project at Thar.
Prime Minister Nawaz Sharif and former president Asif Ali Zardari jointly performed ground-breaking of the US $1.6 billion project which is scheduled to be completed in 2017. It will initially provide 660 MW of power for Pakistan’s energy starved industrial units. The project will be carried out by Sindh Engro Coal Mining Company (SECMC) — a joint venture between Engro Powergen and Government of Sindh. The project would bring about a big change in the lives of the people of Tharparkar, Sindh and the entire country. According to a feasibility study, the project is commercially viable and has no significant environmental threats and social implications.
The commercial production from Thar coal fired power generation plant would be ready by June 2018. In the first phase, 330 MW would be generated and in the second phase another 330 MW coal fired electricity would be generated for producing cheap and affordable energy for the people of the country.
At present the people of Thar are living in utter poverty. There is bonded labor and violation of human rights. The people of Thar are deprived of even access to safe drinking water. They need electricity, better education, transport facilities, health care, housing and employment for their better standard of living. Thar coal has a very large content of water which can be used for the locals. With the development of Thar Coal fields and the establishment of Thar Coal and Energy Board it is anticipated that the Tharis will prosper economically, politically and socially.
