The Public Utilities Commission of Sri Lanka (PUCSL), the country’s energy sector regulator, has revealed that the Ceylon Electricity Board (CEB) saved Rs. 2.5 billion between April and July after they (PUCSL) refused a request by the latter for a short-term emergency power purchase.
An official at the PUCSL speaking to Nation said that the CEB would have had to spend more than Rs. 29 per unit for the said purchase which would have resulted in a huge loss for the institution and the government.
The CEB in April informed the PUCSL that it had obtained Cabinet approval to purchase 55 MW emergency electricity from a private company.
The request was made following major blackouts experienced in March this year. The PUCSL stated that the CEB had incurred a loss of Rs. 600 million owing to the island-wide power outage in March and subsequent power cuts soon after.
The proposed move was initiated with the aim of purchasing power for a period of three months, from April 28 to July 28.
The PUCSL had rejected the request for a power purchase saying the CEB had violated the provisions of the Sri Lanka Electricity Act which is applicable on any procurement of electricity.
Meanwhile, the government recently launched a National programme to install solar power panels to one million households through which it hopes to address the rising demand while also providing an income to the said households.
Energy experts have pointed out that while it would help boost energy production, the country would continue to depend on thermal power generation to meet the peak demands at night.
Senior Lecturer, Department of Electrical Engineering at the Faculty of Engineering, University of Moratuwa, Dr. Asanka Rodrigo, told Nation that while the solar power project would help reduce the power demand during the day time, power generation for the demand at night times would depend on thermal and generation.
“We cannot completely switch off thermal power generation. We could de-load a certain percentage of thermal power, but cannot afford to switch it off completely. It is because it would take a lot of time for the plant to heat up,” he said.
The government has decided to pay users for excess power generated under a 20-year contract. Accordingly, each household will be paid Rs. 22 per unit during the first seven years for excess power supplied to the grid. The households will then be paid Rs.15.50 per unit for the remaining 13 years.
On the other hand, this particular project had also raised concerns on the overall economic viability. However, Secretary to the Ministry of Power and Renewable Energy, Dr. Suren Batagoda told Nation that this method of paying the consumers for excess power would be hugely beneficial for the country.
He pointed out that when purchasing power from the regular plants such as thermal and hydro, there were several aspects which were considered when deciding the pricing. “When it comes to thermal, you have to look at the environmental impact. In addition, in both thermal and hydro, you have the costs in terms of transmission and the cost that is incurred to set up transmission wires,” he said.