CEB clarifies fuel supply and procurement misinterpretation

The Ceylon Electricity Board (CEB) yesterday clarified that the current management has not made any changes to the competitive procurement process for Diesel, and no such procurement occurred under the previous management either. The CEB has responded to recent social media posts.

In a statement, the CEB clarified that there had been a misunderstanding regarding the types of fuel used for electricity generation and procurement processes. According to the CEB, three types of petroleum fuels are currently used for electricity generation: Heavy Fuel Oil (HFO), Naphtha, and Diesel. The electricity production breakdown for 2024, up to 30 September, is as follows:

HFO: 715.3 GWh, accounting for 5.8% of total electricity generation.

Naphtha: 235.5 GWh, or 1.9% of total electricity generation.

Diesel: 133.1 GWh, representing 1.1% of total electricity generation.

Both HFO and Naphtha are by-products of the Ceylon Petroleum Corporation (CPC) refinery, and the CEB purchases these fuels directly from CPC at a mutually agreed price, as no alternative suppliers are feasible. The CEB explained that while Diesel is the only fuel procured through competitive bidding due to the presence of multiple distributors, it is rarely used for electricity generation. Furthermore, the CEB emphasised that the current management has not made any changes to the competitive procurement process for Diesel, and no such procurement occurred under the previous management either.

The CEB underscored that Diesel is not an economically viable option for electricity generation, especially in light of Sri Lanka’s commitment to reducing emissions and transitioning to cleaner energy sources. However, Diesel power plants may be utilised during peak demand periods or when other large power plants are undergoing maintenance. The CEB noted that Diesel accounted for only 1.1% of electricity generation in 2024 as of 30 September.