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43 renewable energy developers seek the president’s intervention to address delays in projects
View(s):A consortium of 43 renewable energy developers has sought President Anura Kumara Dissanayake’s intervention to address “critical process delays” holding up their projects which were initiated after expressions of interest (EOIs) were called as long as four years ago, in 2021.
The developers have received provisional approval from a committee comprising senior officials from all line ministries involved, including the Ceylon Electricity Board, and were selected from an initial pool of 533 applicants. It was an open tender process.
“Collectively, we represent over USD 3.5+ billion in committed foreign direct investment (FDI) for Sri Lanka’s renewable energy sector and are a coalition of Sri Lankan blue-chip firms (including Hayleys, Asia Power, SENOK, Akbar Brothers, Aberdeen Holdings and Laugfs) and international investors backed by multilateral agencies and global energy leaders,” says the letter, sent this week.
In 2021, the then State Ministry of Solar, Wind and Hydropower Generation Projects Development, Sri Lanka Sustainable Energy Authority (SLSEA), and CEB jointly invited proposals for renewable energy projects of 50+ MW. A total of 533 applicants paid a non-refundable Rs. 100,000 application fee and 47 developers remained out of 136 projects shortlisted by a high-level officials committee in 2021, the letter says. They recommitted their interest in 2023, having made substantial investments in project development.
43 applicants subsequently received provisional approvals by the deadline imposed by the SLSEA on February 26 last year. The projects followed due process under relevant laws and regulations, they inform President Dissanayake, claiming to have invested “millions in fees, land acquisition, environmental studies, and grid impact assessments”.
Despite completing all relevant studies, however, (reportedly costing Rs. 20–50 million per project), “projects remain stalled due to fragmented approvals across SLSEA, CEB, and ministries”. The parties, who have formed a group called the Association of EOI Renewable Energy Project Developers, blamed “prolonged tariff negotiation delays and unclear policy directions”.
“Prolonged delays in tariff negotiations and unclear timelines for RFPs/PPAs have escalated perceived risks, mirroring global patterns where policy uncertainty raises financing costs and deters capital deployment,” they point out to the President. “Studies confirm that investors demand 30-50% higher returns under policy uncertainty to offset risks, directly threatening project viability.”
Among the impacts of these delays is lost power generation, they warn: “More than 3000MW of clean energy capacity denied to the grid, with most EOI projects planned to be grid connected by 2027.” They also flag to the President the danger of withdrawal of over US$ 3.5bn in committed funds and a range of other disadvantages arising from not moving ahead with these projects.
For instance, Sri Lanka’s electricity sector relies heavily on fossil fuels, with coal and oil contributing significantly to CO emissions. Delaying renewables would jeopardise climate commitments (with Sri Lanka aiming for 70% renewable energy by 2030 and carbon neutrality by 2050).
“Without renewables, its grid emission factor (584.5 g CO/kWh) will remain high, missing Paris Agreement targets,” the association explains. “Continued reliance on coal/oil plants (e.g., Norochcholai) and LNG imports would increase emissions. LNG, while cleaner than coal, still emits nitrogen oxides (NO), worsening
air quality.”
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