CEB to buy power from independent producers

By Chathuri Dissanayake

Drawing up plans to address the looming power crisis, the Ceylon Electricity Board (CEB)  has proposed to purchase power from two Independent Power Producers (IPPs) while also calling for competitive tenders to for supplementary power purchases up to 60MW in the coming months.

“The power generation plan had to be revised due to different reasons giving us a short fall of about 170 MW.  We plan to purchase power from Heladanavi and ACE Generation Matara to cover the short fall,” CEB Director (Development) and Spokesperson Sulakshana Jayawardana told Daily FT.

The CEB has already received Cabinet approval for the proposal to purchase power from Ace Power Generation Matara and Heladanavi Limited, which supplies 60 MW and 100 MW respectively. Plans to use the plant as an auxiliary for the troubled Norochcholai  coal power plant were botched earlier when the Heladanavi plant which was retired in 2014, was scheduled to be removed from the location. However, the CEB has now come to an agreement with the company to purchase power on same terms as their 2014 agreement, Jayawardana said. The plant will take at least four months of repair time before it is able to generate power to supply the national grid. Ace Power Generation Matara too has expressed willingness to recommence power plant to supply to CEB.

The requirement to purchase power from generators already retired prior to April 2015 rose as the CEB was unable to stick to its Least Cost Long Term Generation Expansion Plan (LCLTGEP) leading to shortages in supply compared to projected growth in the next year. A number of projects in the plan has failed to abide by timeline schedules, prompting the PUCSL to call for explanations from CEB.

Meanwhile the CEB has already written to the Public Utilities Commission requesting approval to procure 60 MW of supplementary power for the next six months, to meet demand during the drought season. The CEB claimed, in a letter to PUCSL requesting approval for the purchase, that it anticipates a “serious power supply situation in the next six months until the onset of south-western monsoon in May 2017”.

“We are planning to call for competitive bids to purchase the 60 MW of power to meet the immediate demand. We will have calls for the bids on an urgent basis,” Jayawardana said.

The bidders will most likely be foreign suppliers as Sri Lanka has no companies which manufacture generators, he said.

The CEB was in the process of purchasing power in a similar manner last year due to shortages of hydropower, but was later abandoned with the onset of monsoon, Jayawardana said.