Government to buy electricity from private generators to address power shortages

Government plans to implement mechanism to buy electricity from private generators to help cope with looming electricity shortage in the first half of next year, while a comprehensive strategy to address the situation will be presented to the Cabinet next week. 

Power and Renewable Energy Minister Ranjith Siyambalapitiya yesterday announced that the Government expected to buy up to 100 MW through the new scheme. 

“Those who own generators in factories and other industrial establishments will be paid Rs. 36 per unit generated from 5.30 a.m. to 10.00 p.m. by the Ceylon Electricity Board (CEB),” he said. 

The Minister also stated that a Cabinet paper had been submitted to ensure a sufficient supply of fuel for steady power generation to meet the demand. 

However, Minister Siyambalapitiya promised an uninterrupted power supply next year, despite facing serious challenges in meeting the demand in electricity. He further claimed that the Government would not impose tariff hikes to address the power shortages. 

Nevertheless, he appealed to the public to conserve energy and be conscious users to help cope with the crisis. 

“If we can get at least 50 MW through conservation then this would ease the situation for the country. It is a small percentage compared to the national consumption of 3,000 MW,” Siyabalapitiya asserted.

Highlighting that prevailing dry conditions were common to all of South Asia not just Sri Lanka, the Minister said: “Although the Western Province received rain, areas where there are reservoirs recorded very low rainfall this year, especially during the North Western Monsoon,” the Minister said. 

“We depend heavily on hydropower for electricity generation so this will affect us severely. Further, priority is given to supply drinking water and for farming. Only after that can we consider power generation.” 

Compared to last year when water levels at reservoirs were recorded at close to 92% capacity in December, this year water levels by 15 December have dropped to 39%, indicating serious challenges in meeting electricity demand as the country generates 50% of its electricity supply through hydropower. 

Last year hydropower accounted for 75% of electricity supplied in 2015 December, the Minister revealed. 

“Victoria reservoir, the most strategic for power generation, recorded a 99% water level in December 2015 but today it has only a 25% water level. This is how serious the situation is,” he emphasised, appealing to the public to be sparse in their usage.  

The Public Utilities Commission of Sri Lanka (PUCSL), in its latest power supply situation report for the first quarter of 2017, highlighted the need to streamline fuel for thermal plants to avoid power shortages. 

At present only two generators from the Norochcholai power plant are in working order. 

PUCSL, which is the regulator of the State-run CEB, issued the warning at the beginning of this month after observing the risks in December. 

The regulatory authority also said that the prevailing weather conditions may result in water released for hydropower generation being controlled, limiting power generation further. It also highlighted the risks of reduced furnace oil production at the Sapugaskanda oil refinery.