Regional Coal: Pakistan consumption to double by 2030: Report

A new report by the Pakistan Credit Rating Agency (PACRA) projects that coal consumption in power generation and the industrial sector in Pakistan is expected to almost double by 2030. The study forecasts coal usage to reach 50 million metric tonnes by the end of the decade, up from 23.9 million metric tonnes in the current fiscal year, driven by the government’s preference for utilizing domestic coal resources. This shift would elevate coal to the country’s second-largest primary energy source.

Pakistan possesses substantial coal reserves, particularly in the Thar coalfield, which spans more than 9,000 sq-km in the Thar Desert, Tharparkar, and holds an estimated 175 billion metric tonnes of lignite coal. The Sindh Engro Coal Mining Company (SECMC) manages these reserves and is Pakistan’s foremost coal producer, operating the country’s initial open-pit lignite mine in Block II of the Tharparkar region.

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Previously, Pakistan relied heavily on imported coal, with imports averaging 68% of the total coal supply between 2019-22. However, the government's stance has shifted towards local coal to preserve foreign exchange reserves and mitigate price uncertainties in the international market. Beginning 2023, the proportion of local to imported coal has reversed to 63% from 37%.

In 2023, Pakistan imported 27.5% of its coal from South Africa, 25.5% from Indonesia, and 31% from Afghanistan. Analysts have expressed concerns over the environmental impact of increased coal usage, citing heavy metal contamination of water sources in Thar and the need for a shift towards renewable energy sources.

Editing by Alexander Ginting