World Bank Approves $150 Million Program to Accelerate Sri Lanka’s Clean Energy Transition
The World Bank Group has approved a $150 million program designed to help Sri Lanka transition toward clean, reliable, and affordable energy. The initiative, titled Secure, Affordable, and Sustainable Energy for Sri Lanka, aims to reduce the country’s dependence on expensive fossil fuel imports while accelerating the shift to solar and wind energy.
Boosting Solar and Wind Energy Projects
The program will support the development of new solar and wind energy projects, which are expected to add 1 gigawatt of clean electricity to Sri Lanka's power grid.
This will bring the country closer to its goal of generating 70% of its electricity from renewable sources by 2030. The program is also anticipated to mobilize more than $800 million in private investment, which will contribute to lowering electricity costs and improving energy reliability for both households and businesses.
David Sislen, World Bank Division Director for the Maldives, Nepal, and Sri Lanka, said, “This program will help deliver clean, affordable electricity to families and businesses across Sri Lanka.”
He added,“We are excited to work with both the government and private sector to make this shared vision a reality.”
Support for Private Investors and Energy Producers
A core feature of the program is a $40 million guarantee provided by the World Bank Group, which will be used in the first phase to help reduce risks for private investors and energy producers.
This initiative aims to derisk payment obligations from the Ceylon Electricity Board (CEB), improving investor confidence and attracting financing on more favorable terms.
The World Bank Group's private sector arms, the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), will provide complementary support through direct investments and political risk insurance.
Also read: World Bank Lifts Ban on Nuclear Energy Funding for Developing Countries
Upgrading Sri Lanka's Energy Infrastructure
In addition to supporting the growth of renewable energy, the program will also focus on upgrading Sri Lanka’s electricity grid.
These upgrades will enable the grid to better integrate renewable energy sources, reduce power outages, and stabilize electricity prices.The modernization of the grid is expected to enhance energy access across the country, benefiting both businesses and households.
Technical Assistance and Reforms for Long-Term Impact
The program will provide technical assistance to CEB to enhance planning, procurement, and operations, while supporting government reforms to improve energy sector competitiveness and oversight. Leveraging World Bank Group resources, it aims to drive long-term growth and energy sustainability in Sri Lanka.
