100 MW Korean solar power project hangs in balance
Emphasising the need of adopting proper tender procedure,Sri Lanka’s Power and Energy Ministry appears to be delaying or dropping a Korean Company’s offer to set up a 100 MW Solar Power Plant, to be done on a Turnkey Basis and handed over to the government which comes with project funding, Korean investors of the project claimed.
If commissioned, it will be one of the largest in South Asia Solar Power Plant; these investors said adding that the projects of this magnitude could be approved by the Cabinet with the consent of the Committee on Economic Management (CCEM).
When contacted, Secretary to the Ministry Dr. B.M.S Batagoda said the the government has taken a policy decision to call tenders for all solar power projects and no unsolicited bids will be entertained.
Normal procedure should be followed even if the project brings many benefits for the country, he said adding that the   company will have to wait for another four months to apply for the tender for 100 MW solar power projects. The MOA Technology Company Ltd of Korea which has made the proposal jointly with world renowned Hyundai will be investing US$ 250 million including the financial cost of project for the solar power project on Turnkey basis (designed, supplied, built, installed fully complete and ready to operate).
The term Turnkey implies that the end user just has to turn a key and start generating power. The Korean company’s offer comes with no capital outlay for the government till such time the plant is operational and generating income, MOA Technology Company official revealed.  On commissioning the plant, the government can entrust operations to a nominated agency such as the CEB or the Renewable Energy Authority. The power generated is to be contributed to the main grid at rates to be determined by the government, he said.
The proposal to government provides for a payback period of 15 years from date of commissioning plant and generating income. It was emphasized that the income generated is sufficient to payback cost of plant, meet operational cost and to have a surplus, he claimed
Apart from providing the land and main grid connection, there was no other contribution to be made by the government, MOA Technology company official told Business Times .
As outlined in their proposal, it is noted that the government will make a profit of over US$200 million over 25 years after meeting project and operational costs without any investment other than providing the required land..
The funding for the project had been lined up by the Korean Company after their initial visits about 6 months ago. However if project does not get underway before end March 2017, the funding will have to be re-negotiated by the Company and the commencement of the project could be further delayed, company official said.
The Company which has made the proposal has done similar projects in countries other than South Korea. If Sri Lanka fails to commence negotiations towards finalisation of project promptly, MOA Technologies will have to rearrange project funding. With no assurances if rearranging of funds will be a possibility, the Solar Power project hangs in balance, he claimed.
Since August 2016 the Korean experts have visited Sri Lanka a few times to carry out required studies etc. The proposal has been made to the government.
The Korean Company did indicate that they have the blessings of their government and it is been considered as a follow up step to the pilot project done by the Koreans in Hambantota of which the cost had been borne by the Korean government.