January 25, 2019, 10:40 pm

by Rathindra Kuruwita

 

A decision to purchase emergency power, at significantly higher cost, would only increase the losses incurred by the Ceylon Electricity Board (CEB), the Ceylon Electricity Board Engineers’ Union (CEBEU) said, yesterday.

CEB Engineers’ Union President Saumya Kumarawadu said yesterday “After the Norochcholai Power Plant was built in 2014, the generation cost of one unit of electricity dropped to Rs. 15.07 and the government was able to reduce the electricity bill by 25%. Since then however no low cost thermal power plants has been added to the system though each year the demand went up by 200 MWs. The cost of one unit of electricity went up to Rs 21.32 in 2017.”

As a result the CEB lost Rs 45 billion in 2017 and the loss increased to Rs. 50 billion in 2018.

“Given the fact that there are delays in the construction of the 300 MW LNG power plant, we will incur more losses in 2019,”he said.

“Bureaucrats and politicians are engaged in a  tug of war to ensure that their allies get the deal. On the other hand, the government is attempting to build two 500MW and one 400 MW LNG plant through Japanese, Indian and Chinese companies. But given the size of our system, the maximum connectable single machine in order to maintain the stability is 300MW.”

The CEBEU head said that the total outstanding loans of the CEB was Rs. 400 billion and that things would continue to get worse for the next six to seven years unless a major low cost power plant was set up.

An energy sector source said that although the CEB had announced that bids were open for emergency power, the relevant officials had not even finalized the tender documents. He added that on average emergency power was procured at around Rs. 30, which is at least Rs. 7 more than the most expensive diesel power electricity unit procured by the CEB.

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