ISLAMABAD: Pakistan is seeking a loan of $900 million from Asian Development Bank for Jamshoro thermal power plant to enhance energy supply with increased energy mix diversification from expensive imported heavy fuel oil (HFO) to less expensive high quality coal.

Official sources said that the project, which is the first stage of a multi-stage government plan for this site, has three components. One component entails construction and five years operational support for one 600MW supercritical coal-fired unit with state-of-the-art emission control devices at the Jamshoro Thermal Power Station. Other two components relate to capacity development for coal-fired plant operations, and environmental remediation of the existing power generation units and site. Additional 600MW super-critical unit is planned as the next stage.

The project would introduce super-critical coal-fired power generation which is the best-available technology for Pakistan. With this technology, the environmental impact would be less than the existing heavy fuel-oil fired power plants and the sub-critical coal-fired power generation technology which is more commonly used.

Pakistan has 23,538MW installed power generation capacity and 14,000MW of available capacity on average.

Many of the HFO-fired power generation plants are not fully utilized because there are not enough funds to pay for fuel.

The increased HFO-fired power generation was the major reason for the cost-recovery tariff to continuously increase.

The ADB suggests that the government must seek ways to lower the generation cost while increasing the electricity supply to reduce shortages.

The government dramatically increased industrial, commercial and bulk buyer tariffs by 50pc in August 2013 and will eliminate subsidies totally for these customers by the end of 2013.