Local Coal versus Imported Coal on the Merit Order

Pakistan’s coal fleet is a split personality. Imported-coal plants on the coast were built for scale and CPEC timelines. Thar lignite plants were built for indigenous security. In dispatch, the two compete on energy price, logistics, and contractual must-run features. In finance, both can generate receivables that feed circular debt. Imported higher-grade coal and local lignite differ in ash, sulphur, and calorific value. Transition Economics Institute advises publishing a monthly comparative table: megawatt-hours from local coal versus imported coal, estimated dollar fuel bill avoided or incurred, and capacity payments associated with each class.

Port logistics and freight for imported coal add volatility that mine-mouth lignite avoids. Lucky Electric’s pathway toward Thar fuel, contingent on mine expansion, shows how imported-coal assets may convert rather than strand. Coal’s long-term role will shrink if renewables, hydro, and storage scale with flexibility.