Sri Lanka has achieved almost 100 percent electrification, but this does not mean that everything is rosy in the power generation sector. Far from it. There is actually an energy crisis, as the present power generation capacity is bursting at the seams. Power cuts will be inevitable if no new capacity is added during the next few years.
This problem has been exacerbated due to the fact that the previous Government failed to add any capacity to the National Grid for the past four and a half years. In fact, its much-touted Liquefied Natural Gas (LNG) power plant at Kerawalapitiya never got off the ground, mired in a tender controversy.
There was a desperate plan to obtain 200 MW of emergency power from a Turkish company, a deal which reeked of corruption. The change of administration and other factors prevented this crooked deal from going ahead. Had it gone through, the country would have lost more than Rs.5 billion, that could otherwise have gone to a permanent power generation project. The previous administration has also seemingly discouraged renewable energy proposals. It was also doubtful whether proper feasibility studies had been conducted in any of these instances.
In the light of these revelations, President Gotabaya Rajapaksa has insisted that proper feasibility studies be conducted before the actual implementation of the proposed new projects in the Power and Energy sector. The President laid down this stricture on Thursday when he chaired a meeting attended by senior officials of agencies under the purview of the Power and Energy Ministry at the Presidential Secretariat. Proposals relevant to the power and energy sector made in the President’s Vistas of Prosperity and Splendour policy statement were discussed at this meeting.
It was also revealed that even though many power generation and supply project agreements had been signed with foreign countries in respect of the power sector most of them were signed with private companies rather than on a government-to-government basis. The Government must initiate discussions to turn them into Government-to-Government agreements where possible.
The President has already turned his attention to making State-owned ventures including the Ceylon Electricity Board (a virtual monopoly, since the private electricity provider LECO is also owned by the CEB) profitable in the medium term. The CEB loses around Rs.130 billion per year, which a country like Sri Lanka cannot afford. Though corruption is clearly a factor, losses have been aggravated by the CEB not following the recommendations of the Public Utilities Commission of Sri Lanka (PUCSL) on new power projects. Unfortunately, the tussle between the PUCSL and the CEB has cost the country dearly. The President should intervene in this regard and get the two organisations going on the same wavelength.
LNG is a clean fuel though of fossil origin and the new Government must call for fresh tenders to start the process anew. This should be a priority if we are to avoid an acute power crisis. If another drought comes, we will be in dire straits as the present hydropower capacity is simply not enough. The Government must also be wary of approving any more mini hydro plants, as the environmental impact could be severe. However, some experts have pointed out a viable short-term solution – connecting the 500MW of generator power available at State institutions to the National Grid. This proposal should be looked into urgently.
There is also an acute need to reduce the dependence on thermal power. Not many realize that a substantial part of the annual US$ 6 billion fuel import bill goes to fossil fuel imports for power generation. Barring LNG, there is only one solution to this issue: Renewable energy.
Being a tropical country, Sri Lanka is blessed with an abundance of sunshine and wind year-round. It is therefore surprising that successive governments have laid little emphasis on these two sources of renewable and non-polluting energy. The quantum of power generated from wind and solar is still abysmally low.
We need to kick start solar and wind projects that have been languishing in the pipeline since 2015 and invite international investors to launch projects in this sector. The cost of solar panels has fallen dramatically over the last few years and their efficiency has increased too. Moreover, solar panels are now being locally manufactured. If the panels can be sourced locally, we can save valuable foreign exchange as well.
The Government should set a clear guideline and route map for renewable energy, say, 30 percent of power generation to be from such sources by 2035. Some countries such as Germany can already switch to 100 percent renewable energy should the need arise. It may be unfair to cite an example from a developed country, but even developing countries are taking rapid strides in this sector. Neighbouring India, for example, has set its sights on having 100 GW of Solar power by 2022. More concessions must be granted to solar and wind power projects for residences and commercial properties, in addition to major solar and wind farms.
In the meantime, we can all do a little bit to help tide over the energy crunch. If you see an unwanted bulb, switch it off. If an AC is working in an empty room, switch it off. With the price of LED bulbs at an all-time low, every household should replace incandescent bulbs, which should anyway be phased out. Little things can also go a long way in addressing the power crisis.