Sri Lanka enacts law to boost renewable energy investment, reform power sector
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Sri Lanka’s parliament passed a law aimed at boosting investment in renewable energy. This legislation is part of the country’s efforts to reduce financial losses in its state-run power monopoly. These actions are part of Sri Lanka’s commitments under a $2.9 billion program with the International Monetary Fund (IMF).
As part of a $2.9 billion agreement with the IMF, Sri Lanka committed to reforming its state-owned companies to ensure their profitability.
This reform includes restructuring the Ceylon Electricity Board (CEB) by separating its transmission, generation, and other services into independent entities. It aims to improve efficiency and financial performance within the power sector.
Speaker Mahinda Abeywardena said the 225 lawmakers approved the new legislation with a majority of 44 votes, Reuters reported.
Power and Energy Minister Kanchana Wijesekera told parliament that the Electricity Bill would make the CEB monopoly more profitable and attract investment in the renewables sector.
He added, “Sri Lanka has set a target of generating 70% of its power via renewables by 2030. Sri Lanka will need $12 billion in the next six years to meet this goal. So, we need to open the sector to attract this investment.
Read more: Adani Green’s wind power project raises environmental concerns in Sri Lanka
Wijesekera said the new law’s three-year reform timeline will also enable Sri Lanka to set up wholesale power markets, open access, and engage in power trading across South Asia.
Additionally, Sri Lanka entered into a 20-year power purchase agreement with India’s Adani Green Energy Ltd. for $442 million to build two wind power stations.
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