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Sly hand of private interests in new power tariff scheme, says CEBEU
Ceylon Electricity Board (CEB) engineers have protested to the Minister for Power that new tariff plans will hurt consumers while lining the pockets of private developers.
They have written to Minister Dulles Alahapperuma to condemn the Government’s decision to amend the Electricity Act to abolish the competitive tender process in reintroducing a Feed-in Tariff (FiT) for renewable energy projects.
The letter sent to Mr. Alahapperuma by the Ceylon Electricity Board Engineers Union (CEBEU) on May 29, and copied to President Gotabhaya Rajapaksa, strongly rejects any move to return to FiT schemes.
It states competitive bidding processes for renewable energy (RE) projects have clear advantages for the rates-paying public.
In contrast, it notes: “As you may recall, when the FiT schemes were in place, tariffs were determined by ‘committees’ and during such times the CEB was paying the highest prices for RE in the whole world until the same was discontinued in 2013.
“For instance, the [previous] tariff for wind energy under the feed-in tariff scheme was Rs. 21. It was brought down to Rs. 12.86 after the introduction of competitive bidding in August 2020 for two 10 MW wind power plants in Chunnakam.”
The engineers note that the Presidential Commission on Simplification of Existing Laws & Regulations in the Interest of the People which, in aiming to remove legal and regulatory barriers and expedite development projects, has proposed that a renewable energy FiT be reintroduced.
“However,” the CBEU states, “we strongly deplore the efforts by certain groups with vested commercial interests to exploit the genuine opportunity given by the President by including proposals which are solely aimed at realising their business interests.
“We have observed that the aforesaid proposals originated from the RE industry and are aimed … [discontinuing the] present Competitive Bidding Processes as applicable for RE development, contradicting the President’s policy.”
The letter alleges the Public Utilities Commission of Sri Lanka (PUCSL) had tried to influence the CEB to increase further tariffs based on the requirements of private developers.
“However, thankfully, CEB was able to legally challenge that enforcement order of PUCSL and as a result the Attorney-General’s opinion (24.a) declared that prices paid to purchase electricity from RE could be determined only by following a competitive and transparent process.”
The letter says that “benchmark determination” paved the way to introduce the current competitive bidding process for developing alternate energy sources, and this had been a “major boost” for the renewable energy industry.
“We clearly observed how the competitive bidding brought down the prices of tariff given for wind power,” the letter states.
Pointedly, the engineers say: “We invite the Minister to seek out the people who are holding these important tenders in their drawers without allowing these to proceed, so that we may actually find out where the problem is”.
The CEBEU said it strongly believes many changes are required to make the power sector move speedily.
“The power sector should be considered a unique sector that drives almost all other processes as well as the economy of the country,” the CEB engineers emphasised.