SL gets yet another policy on power and energy

By Charumini de Silva

The Government yesterday approved a fresh policy on Sri Lanka’s power sector energy mix as opposed to the ‘Least Cost Long Term Generation Expansion Plan 2018-2037’ (LTGEP) proposed by the energy regulator to ensure energy security in the country.

The proposal mooted by the Public Utilities Commission of Sri Lanka (PUCSL) and submitted by the Power and Renewable Energy Minister was approved by the Cabinet of Ministers at the meeting held yesterday. “Sri Lanka’s power sector energy mix policy will include all sources, not focusing on one aspect of the landscape of the entire value chain,” Power and Energy Ministry Secretary Dr. Suren Batagoda told Daily FT.

He said the key features of the new policy will focus on three key areas such as national energy security, environmental conservation and making the most out of indigenous energy sources.

Dr. Batagoda claimed one of the major contentions was that the base case scenario proposed in the LTGEP did not align with the original CEB proposal submitted to the PUCSL.

“The PUCSL has no capacity to build, plan or to be regulating the market,” he added.

Furthermore, he stressed that the PUCSL doesn’t have the capacity to dictate terms on the energy mix or the capacity of the plants required by the country.

The base case plan in the LTGEP will delineate the development of 1500MW LNG, 2700MW coal, 105MW gas turbine and 320MW furnace oil power by 2037 as well as renewable energy development of 1205MW wind, 1392MW solar, 215MW mini hydro and 85MW biomass power. More specifically, the total addition of renewable energy within the 20 year period is mentioned as 1205 MW of wind, 1232 MW of solar 200 MW of mini hydro and 80 MW of bio mass power.

He said the new policy will be implemented with immediate effect as Sri Lanka cannot depend too much on one source of energy.

Nationally Determined Contributions (NDCs), submitted to the United Nations Framework Convention on Climate Change (UNFCCC)  in 2016, recognises the country’s commitment of reducing GHG emissions through cuts in the coal and liquid petroleum fluids in the energy sector with a simultaneous focus on developing renewable energy sources. As a member to the Climate Vulnerability Forum, Sri Lanka has committed to reaching net zero emissions targets by 2050.

Nevertheless, the private sector pointed out that the Long Term Generation Expansion Plan developed by the Ceylon Electricity Board (CEB) contradicts the Government’s policy of moving towards a zero emissions pathway through renewable energy development, as mentioned in several key documents, including the presidential manifesto, the National Energy Policy developed by the Ministry of Power and Renewable Energy, as well as the Government’s international commitments such as Paris COP21.

Dr. Batagoda justified that the LTGEP was within the Government’s commitments towards environmental conservation.

But, concerned citizens pointed out the LTGEP’s sole focus on the economic valuations based on least cost scenarios, thereby ignoring or discounting the cost of externalities and environmental cost embedded. 

The Ministry Secretary said the PUCSL had not conducted the proposed long-term generation plan while failing to reach an agreement with the CEB to implement the original proposal submitted by the power generator.

He noted that the CEB has better experience than the PUCSL as they work in the industry and know what exact mix of energy is needed when and where, as well as about the appropriate distribution channels.

If the issue was the absence of a policy, he said then the two institutions should have come up with a solution.

In terms of the pressure mounting from CEB trade unions to remove PUCSL Director General Damitha Kumarasinghe from his post, Dr. Batagoda said that it was just a request to appoint a “fit and proper” candidate for the position that knows the industry and the subject thoroughly.

The PUCSL, however, said that they would stick to the original plan proposed by the Commission, unless the Government wants it changed.