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Serving Sri Lanka

This web log is a news and views blog. The primary aim is to provide an avenue for the expression and collection of ideas on sustainable, fair, and just, grassroot level development. Some of the topics that the blog will specifically address are: poverty reduction, rural development, educational issues, social empowerment, post-Tsunami relief and reconstruction, livelihood development, environmental conservation and bio-diversity. 

Tuesday, June 28, 2005

Business community campaign to solve power crisis

Sunday Observer: 26/06/2005"

The country is in a serious power crisis owing to the failure to implement the mega power projects planned several years ago. The business community is now engaged in a campaign to make the public aware and pressure the authorities to solve the crisis immediately.

The Government and donor community propose to restructure the CEB and create independent government owned units for power generation, transmission and distribution.

In the debate on the re-structuring of the CEB, the trade unions say that the government and politicians are responsible for the crisis and last week we published the allegations of the CEB engineers union. The Unions are also against re-structuring and say it is a move to privatise the CEB.

However, CEB officials also cannot wash their hands from the responsibility of the present crisis. Top officials and powerful engineers are also involved in these controversial deals. A section of the CEB engineers who did not wish to be quoted accused the "engineers' mafia" for blocking the CEB reforms.

These engineers are responsible for the inefficiency and bureaucracy of the CEB. They are enjoying high salaries and other perks and they fear losing them after the reforms and therefore are reluctant to go ahead with any form of restructuring in the CEB.

All top positions of the CEB are held by engineers. Even the post of Assistant General Manager (Personnel Administration) is filled by an engineer.

The engineers don't allow the appointment of an AGM (Finance) because it should be filled by an accountant and as a result the most responsible financial management position is held by a Finance Manager instead of an AGM, they said.

There is evidence that shows the inefficiency of the CEB. The CEB under utilises its installed capacity. Only 35% of the country's total installed capacity is used to generate power.

Only 30% of installed hydropower capacity and 40% of installed thermal power capacity is used, according to Environment Foundation Limited (EFL).

The high system loss is one point. It is estimated that nearly 20% of power generated is wasted to the system. However, the CEB engineers union says it is normal system loss and the CEB is better off than countries such as Bangladesh where the loss is nearly 50%.

EFL says that about 9% of the loss is due to non technical reasons or illicit and unauthorised tapping of power, which reflects ineffectiveness in the CEB distribution. The power piracy accounts for 663 GWh a year which is enough to power 275,000 households and is a Rs. 5.1 billion financial loss to the CEB, EFL said.

CEB engineers also stressed the need to shift to low cost coal power generation. They pointed out that coal is the main source of electricity generation in most countries. In India it is 78%, USA 50%, China 76% Poland 95% but in Sri Lanka it is zero percent.

Feasibility studies and engineering designs of the Norocholai coal power plant have been completed. It is the government that took the decision to halt the construction of the plant and the CEB cannot go ahead with it.

The present government recently moved to re-start the project but it lapsed again. The other site identified for a coal plant is Mawella in the Hambantota district. The detailed study has not been done for this site.

The CEB has made progress with the Upper Kothmale hydro project and many issues have been resolved but the date to start work has not been fixed as yet. In the latest survey of The Economist magazine discussed the intensifying power crisis and escalating energy costs.

The crude oil price is no longer an issue in electricity costs in many countries because after the first oil shock in 1970s the world shifted to alternative energy sources such as coal, nuclear and natural gas. Oil accounts only for 7% of the world's electricity generation.

The only problem today is energy for vehicles, the report said. However, even after several oil shocks Sri Lankan leaders failed to shift to alternatives with a long term plan. Today 56.5% of CEB generation capacity is high cost thermal.

CEB engineers are also pessimistic about other alternative renewable energy sources as a measure to the present crisis and emphasises the necessity of a large coal power plant.

Wind, micro hydro and dendro cannot be used to provide the base capacity. They can be used to supply peak capacity with a stable base capacity of coal, they said.

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