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Rooftop solar power: CEB ordered to sign agreements at previous higher tariff; downward revision overturned
View(s):By Niranjala Ariyawansha
Power and Energy Ministry Secretary Sulakshana Jayawardena has instructed the Ceylon Electricity Board (CEB) and Lanka Electricity Company (LECO) to continue signing agreements on the previous higher tariff with rooftop solar consumers who have already paid the required fees, submitted documents and finalised installation before July 1, 2024.
This decision was taken in response to serious dissatisfaction expressed over the past few weeks among a large group of solar power investors and consumers that produce rooftop solar power, a ministry spokesman told the Sunday Times.
“Considering the customers’ intention to sign solar rooftop power purchase agreements under the previous rates, as they made investment decisions based on the previous rates and the delay in connection is beyond the control of customers, it is hereby instructed that contracts for these solar rooftop installations, which were finalised and submitted by July 1, 2024, should proceed at the previous solar purchasing rates,” the Ministry Secretary states in a letter.
The CEB was purchasing a unit of rooftop solar power for Rs. 37 when the Cabinet on July 2 reportedly approved a reduction of this price to Rs. 27 per unit—a ten-rupee drop. This is despite President Ranil Wickremesinghe, in his capacity as Finance Minister, making strong observations on Power and Energy Minister Kanchana Wijesekera’s Cabinet memorandum that if the rooftop solar tariff is reduced, “the rooftop solar developers may be discouraged from investing in the rooftop solar projects.”
This may hinder the current government policy to generate 70 percent of electricity through renewable energy sources by 2030, he warned. “Therefore, promotion of rooftop solar developers/customers through an investment-conducive environment is vital to attract more developers/customers for rooftop solar projects,” the President said, adding that it was “not appropriate to reduce the proposed rooftop solar tariff at this stage until a sufficient number of rooftop solar projects are established to achieve the 70% target of electricity generation from renewable energy sources by 2030.”
A senior CEB official, speaking on condition of anonymity, questioned how Cabinet approval was granted to the controversial price drop when the President’s observations objected to it. The Cabinet sanctioned a tariff of Rs. 37 per unit in October 2022. Minister Wijesekera submitted a new proposal on June 11 this year to lower the price.
The Public Utilities Commission of Sri Lanka (PUCSL) also opposed the move this week. It said the CEB had requested regulatory approval for the revised rooftop solar purchase tariff. It, too, pointed to the government’s renewable energy policy and said that the CEB’s Long-Term Generation Expansion Plan (LTGEP) 2023-2042, approved by the Commission, had accordingly identified technology-specific targets to achieve this goal. This included rooftop and ground-mounted solar capacity being added to the system.
The PUCSL pointed out that neither the rooftop nor ground solar generation targets of the LTGEP have been met yet. Stressing that the proposed reduction in the rooftop solar tariff “may hinder the achievement of national energy policy targets,” the Commission has recommended that the prevailing rates continue until it gathers additional information and analyses and verifies the new tariff.
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