PUCSL Chief claims gloom and doom over new Ceylon Electricity Act

Public Utilities Commission (PUCSL) Chairman Janaka Ratnayake on Wednesday went public with what he believes as doom and gloom over the proposed new Ceylon Electricity Board Act.

He revealed that a committee appointed on the recommendation of the Minister of Power and Energy, has prepared a proposal and a bill to abolish the Ceylon Electricity Board Act and transfer its resources to 14 companies established under the Companies Ordinance No. 7 of 2007.

Ratnayake points out that if the proposals in the relevant draft are implemented, the national energy security will be under the control of the companies who take over the Mahaweli power plants, Lakshapana power plants, Uma Oya and other hydro power plants and all thermal power plants including Norochcholai.

“In addition to this, the inclusion of the provision that the rivers and reservoirs that supply water to the power plants should be managed according to the priority of the companies that own the hydropower plants will also challenge the rights of the people related to agricultural and drinking water needs,” claimed Ratnayake.

“A committee consisting of 7 members has prepared a draft called the Sri Lanka Electricity Industry Restructuring Act to completely abolish the Sri Lanka Electricity Board and transfer its resources to 14 more companies. One of its members had recently issued a statement to the media about the relevant draft. It must be said that this committee has done tasks that are not related to them instead of the task assigned to the committee. The Cabinet of Ministers has only assigned this committee to study the institutional structure of the Sri Lanka Electricity Board as mentioned in the Sri Lanka Electricity Restructuring Act No. 38 of 2002 and to make recommendations for the implementation of that institutional structure. 

“The institutional structure that is referred to there is the structure of generation, transmission and distribution. But the draft prepared by this committee is aimed at achieving their personal ambitions. The draft contains objectives that favour personal and political goals rather than actual reforms in the electricity industry. One of the main proposals of this draft is to abolish the Ceylon Electricity Board Act and transfer all the resources of CEB to 14 companies in the first phase. By that, all Mahaweli power plants are to be transferred to one company. 

“All the power plants of the Lakshapana complex are to be transferred to another company. The Hydro plants including Samanala wewa, Uma oya and Kukule gaga will be transferred to another company. Norochcholai power plant is also to be transferred to another company. In this way, all the power plants belonging to CEB have been targeted to be transferred to 6 companies. The national transmission system as well as the distribution systems are being broken up into separate companies. The power to purchase electricity is also transferred to another company. 

“Not only that, the control powers of the CEB employee welfare fund are also transferred to a company. If there are any remaining assets after allocating to the above companies, it has been proposed to transfer them to another company. If this proposal is implemented, it is clear that the energy security of this country will fall into a dangerous situation due to the privatisation of these distribution companies in the future.”

Ratnayake, added that due to the inclusion of provisions in this Act that water released from the rivers and reservoirs that supply water to the hydro power plants should be given the priority to supply water to the plant, the needs of the agricultural and drinking water needs of the farmers and the public will be violated.

«According to the current priority list, the first is to release water for drinking and agricultural needs. But as per the section 115 of the proposed act, the first priority has been given to the hydro power plants.

This will violate the basic human rights of the public by imposing a condition that the water required to generate electricity should be released for the companies before the other needs.  

Ratnayake revealed that the proposed Electricity Restructuring Act has also made provisions to abolish the current regulatory body of the electricity industry, the Public Utilities Commission of Sri Lanka.

“The Public Utilities Commission of Sri Lanka is an independent body established by a powerful Act accountable to Parliament. It has always been an institution under the Minister responsible for policy development and implementation. Provisions have been made for that by the Act itself. As a result, the Minister of Power and Energy has no ability to directly influence the decisions of the Commission. It is because of this situation that the Commission was able to reject 16 emergency power purchase proposals submitted by the former power ministers in the past. 

“The new Act replaces the Commission with an institution called the Electricity Regulatory Commission under the Minister of Power and Energy. The members of the Commission as well as its Director General are appointed by the Minister of Power and Energy. Because of this, all the inappropriate proposals proposed by the Minister of power and energy would be able to get the approval of the Commission. Under this situation, instead of an independent agency that protects the rights of electricity consumers and the public, a puppet-like regulatory agency controlled by the minister will emerge. Not only that, this proposed act has proposed to establish a number of other institutions and committees. The majority of their members are appointed by the Minister of Power and Energy.