Govt keen on PPPs for energy sector | Sunday Observer

Govt keen on PPPs for energy sector

The government has made the power and energy sector tax-free, to encourage the growth of the sector through more PPP partnerships. The corporate tax is at a minimum rate of 14 percent and the industry is poised for growth with the facilities that the government is providing, Deputy Minister of Power and Renewable Energy, Ajith P. Perera told the ‘Green Energy 2017 Champion’ Campaign.

The ‘Green Energy 2017 Champion’ Campaign has been organized by the German Federal Foreign Office with the Ministry of Power and Renewable Energy of Sri Lanka, and the project implementing partner Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ) GmbH and Sri Lanka Sustainable Energy Authority. Sri Lanka is committed towards adding more solar and wind energy to the national grid, and has promised to make the national grid a smart grid in another five years time, he said.

According to the Deputy Minister, Sri Lanka is to call tenders to purchase 875 megawatts of power shortly.

To add more solar and wind energy to national grid, it is necessary to have more storing capacity.and safeguard smart systems in place. Storage of energy is still high in another parts of the world as well, the minister said adding that as per the opinions of the specialists in Sri Lanka, the country can add more than 500 mega watts from the solar energy without having the storage capacities.

During the next one and a half years, it is planned to add that capacity to the national grid.

“As per the policy, in power generation, the government will invest in infrastructure, development of the systems, but the government will not invest in power generation.

“As we have introduced fair tendering process, there has been a good response in the private sector both locally and globally to invest in this sector,” he said.

With regard to solar power, Sri Lanka opened a competitive tender in this regard as result, country managed to reduce tariff from Rs 22.10 per unit to Rs 17.01 per unit.

In May last year, the government opened the same tender with regard to the wind energy, through that, tariffs were reduced Rs. 19 per unit to Rs. 12.29 per unit, registering more than 40% reduction.

“We have identified that there is an opportunity for competitive tendering in renewable energy, earlier, there was an understanding it was not possible.”

The government has also instructed the Ceylon Electricity Board to carry out the purchasing of solar energy at a very systematic and transparent manner.

German Ambassador to Sri Lanka and the Maldives, Jorn Rohde said that political consensus is crucial to implementing and persisting renewal energy initiatives to meet set targets in the energy sector of Sri Lanka.

Noting that the need for electricity in Sri Lanka grows by 5% every year, Ambassador Rohde pointed out that renewable energy will answer all the challenges faced by the sector.

The ambassador also stressed the need to initiate climate mitigation efforts by both individual and state level to avert foreseeable environmental perils.