ADB funds $ 150 m for green power; energy efficiency boost

Monday, 24 November 2014 00:29 - - {{hitsCtrl.values.hits}}

The Asian Development Bank and the Finance Ministry last week signed two loan agreements for $ 150 million out of a total program of $ 300 million to boost green power and energy efficiency in the country. The demand for electricity is increasing rapidly with growing economic activity in Sri Lanka. The national grid requires an additional capacity of 2502 MW by 2020 to increase the current national electrification ratio of 96% and fulfil future demand.

Therefore, the Government has given priority to ensuring low-cost energy security while diversifying energy sources and promoting power generation through cleaner and non-conventional renewable energy sources. Accordingly, with the aim of increasing access to a clean and reliable power supply by enhancing clean power generation, system efficiency and reliability, the Government has negotiated with the Asian Development Bank (ADB) to obtain $ 300 m for the implementation of the Green Power Development and Energy Efficiency Improvement Investment Program. This program will focus on the green power development portion of the government’s energy sector investment program while encouraging and facilitating private sector investment in renewable power generation through improving transmission infrastructure. In addition, the program will support development of hydropower generation and power transmission infrastructure. The total investment cost of this program is $ 440 million. The ADB has agreed to provide $ 300 million of the total cost under the Multi-tranche Financing Facility (MFF) and $ 150 will be provided under the first tranche. The proposed project under the first tranche of the program will include the construction of (i) the 30 MW, run-of-river hydropower plant at Morogolla, (ii) four new grid substations and associated facilities at Kerawalapitiya (220/33 kV), Kappalturai (220/132/33 kV) , Kaluthara and Kesbewa (both 132/33 kV) and augmentation of Katunayake and old Anuradhapura 132/33 kV grid substations in Western, Eastern and North Central Provinces; (iii) 33 kV lines and gantries at around Vavunativu and Madampe in Eastern and North Western Provinces; and (iv) DSM pilot subprojects in Colombo under the physical investments. Further it is proposed to strengthen the capacity building and project management including preparation of future MFF investments and implementation supervision of capital investments of first tranche under the non-physical investments. The Ministry of Power and Energy will be the Executing Agency for the Project, and the implementing agency will be the Ceylon Electricity Board. The overall program is scheduled to be completed by 31st March 2020 while the completion date of the project to be implemented under first tranche is 30th September 2019. In this connection, Dr. P.B. Jayasundera, Secretary to the Ministry of Finance and Planning on behalf of the Government of Sri Lanka, and Sri Widowati, Country Director of ADB Sri Lanka Resident Mission on behalf of ADB, signed the two Loan Agreements to obtain $ 150 million on 20 November at the Ministry of Finance and Planning. Wencai Zhang, Vice President of the ADB also participated.