Reforms in Imported Coal Procurement Expected to Save Rs380 Million Annually

ISLAMABAD: The Power Division has decided to introduce reforms in the procurement of imported coal for power plants after identifying significant differences in prices and discounts, with annual savings of around Rs380 million expected from the move.

Meetings chaired by Federal Minister for Energy Sardar Awais Ahmad Khan Leghari reviewed coal procurement agreements and prevailing market practices.

Officials said some power plants were purchasing coal from the same international benchmark and suppliers but were receiving different discounts. The difference in discounts ranged from 25 cents to $7.12 per metric ton.

Under the new policy, power plants will be required to purchase coal from the supplier among their contracted suppliers offering the highest discount.

According to the Power Division, the reform will not require any additional investment and is expected to improve procurement efficiency and reduce costs.

The division said the savings generated through the measure would ultimately be passed on to electricity consumers.