Public Utilities Commission reveals outlook for 2013

By Cheranka Mendis

The regulator of Sri Lanka’s electricity sector and shadow regulator of the lubricants market, the Public Utilities Commission of Sri Lanka (PUCSL) has saved Rs. 86 billion to the Government since taking the mantle of regulating the electricity sector in April 2009.

Providing electricity to 5.5 million consumers in the country, the body yesterday launched the official website of the commission, which promotes a new online consumer dispute resolution system along with up-to-date information on electricity industry tariffs and regulations to consumers, licensees, energy sector investors, and stakeholders.

Deemed as a much-needed tool in an era where technology creates efficiency, the website would enable the commission to promote transparency and create awareness among the public, PUCSL Chairman Dr. Jayatissa de Costa said. Along with the launch of the website, the commission also presented its outlook for 2013 based on its corporate plan for the period 2013-2015.

Prior to finalising the plan, the commission requested all stakeholders in the electricity industry to participate in a consultative process to discuss the content of the plan.

Explaining the outlook for 2013, PUCSL Director General Damitha Kumarasinghe noted that the commission has identified eight goals to work on.

The goals include assuring the protection of electricity consumers, ensuring the fairness in the electricity tariff and service charges, ensuring energy security, conservation, efficient use and concerns, ensuring adequacy of quality and reliability of the electricity supply, ensuring safety of electricity, disseminating sector information, establishing electricity market structure to promote competition, and regulating downstream petroleum product in the market.

Kumarasinghe noted that each goal has a program line-up to ensure that they are realised accordingly.

With the intention of protecting electricity consumers, PUCSL will hold a series of consumer awareness on industry regulation, implement feedback system on the Supply Service Code, and establish regional consumer societies in nine provinces this year. Awareness will also be created on energy estimation and meters. “We will soon publish the Consumer Rights and Obligation (CRO) statement,” he said.

With network losses for 2011 standing at an average 11.72%, PUCSL has set an average network loss target of 9% for all distribution licensees. “The commission will now study the technical factors and managerial and investment efficiencies contributing to current network losses. Based on the findings we will develop a set of realistic network loss targets for the licensees.”

Kumarasinghe said that the commission would also embark on a feasibility study in an attempt to make the electricity rates cost reflective depending on consumer time of use. “The goals also include plans to develop a set of long term strategies for street lamp management and an electricity supply chain analysis.”

The commission is also expected to put out specifications on procedures for review of tariffs and come up with guidelines on how to implement tariff reviews and on regulatory accounting.

Under energy security, a comprehensive 10 year non-conventional renewable energy policy will be formulated, alongside a demand forecast for each distribution licensee, assessment on applicability of smart meeting concept to Sri Lanka, and a study on efficiency of energy intensive process.

In 2013, the commission will undertake inspection of compliance of non-conventional renewable energy power plants on license conditions and look at identifying performance measurements for generation and transmission licensees.

Formulating grid code enforcement panel and enforcement of grid code, setting standards and monitoring quality of the electricity supply, creating awareness among the public – across workplaces and schools, and regulations for procurement of new generation plant and extension of existing generation plant are among some of the other key plans for the year.

“With the envisaged role of PUCSL as the regulator of downstream petroleum industry this year, the commission plans to promote awareness on stakeholders, put in place a set of rules on application for petroleum licenses, exemptions, and authorisation will take place within the year,” Kumarasinghe said.

The commission will also identify petroleum products under price controls, create a methodology for pricing, and come up with templates for licenses, etc.

Expressing his views, Chief Guest and International Monetary and Cooperation Senior Minister and Finance, also holding the position of Planning Deputy Minister, Dr. Sarath Amunugama noted that the country must reduce its dependency on oil and look for substitutes while contemplating trading energy beyond boundaries as done in countries such as India, Bangladesh, Pakistan, and Nepal.

The country must also look at a proper mix to gain electricity in terms of the percentages used from hydro, solar, fossil fuel, etc. As Sri Lanka does not produce oil, the dependency on oil makes the country vulnerable to increases in world oil prices.

“We do not produce oil, therefore whatever we do or whatever policies we bring in, when the price of oil goes up in the world, we are affected. We sometimes have to go into debt due to this. The proper mixture must be well thought of,” Amunugama said.

“How far can the Electricity Board depend on oil? Internally, some of the fuel power plants are inefficient. These have become obsolete – the power station, the machinery and equipment, and those working there as well, along with some of the policies,” he asserted. “We must look at a new way and face the new world with technology, competition, and development.”