Bill soon to set up body to approve electricity tariffs
The Bill to set up an independent regulatory body for electricity
will be presented in Parliament next month, said Director General,
Public Utilities Commission of Sri Lanka (PUCSL), Prof. Priyantha
He said the regulatory body will help to approve tariffs for
electricity and ensure that rates are revised in a transparent manner.
"An independent institution comprising professionals is essential to
monitor the efficiency of all public institutions that provide
services," Prof. Wijayatunga said.
In response to a question on the proposed new tariff rates for
electricity due to come into effect from next month, he said the Ceylon
Electricity Board (CEB) which incurs a massive loss due to the rising
world fuel prices has to revise its rates to cover its operational cost.
A Treasury decision last year to withdraw the subsidy granted to the
CEB was the reason to revise the tariff structure. The CEB will now be
forced to buy fuel to generate thermal power at market prices.
The CEB which paid Rs. 55 per litre for diesel last year amidst sky
rocketing world crude oil prices will now be invoiced at an average
price of Rs. 85 per litre with indications that fuel prices will
The Treasury had to subsidise the CEB in keeping with the escalating
crude oil prices in the world market. The CEB has not been able to
increase tariffs according to oil prices.
Prof. Wijayatunga said it is not fair to burden the people who do not
have electricity with tariff revisions. It is the consumer who should
pay and not the entire country.
Around 22 per cent of the households in the country do not have
electricity. The cost and the difficult terrain in rural areas are some
of the reasons cited by the authorities for the delay in providing
electricity to these households.
The Director General said the electrification rate in the country
which is around 78 per cent is better compared to India, Bangladesh,
Nepal and Pakistan which is less than 50 per cent. Sri Lanka's
electrification rate increases by around two to three per cent every
"By revising electricity rates the CEB will not be making profits but
will cover its operational costs. What is important is an efficient
management to improve management efficiency which will help the
institution to provide a better service," he said.
When chamber heads were contacted for their views on the proposed
tariff rates they said with such a major revision low income families
will be severely affected and high electricity consuming industries will
have to be closed.
Chairman, Ceylon National Chamber of Industries (CNCI), A.K.
Ratnarajah said high energy consuming industries such as the porcelain,
tiles, rubber and garments will be adversely affected.
Industries will not be able to compete with low quality products.
With the decline in the quantity of exports people will lose
employment", Ratnarajah said. Managing Director Aitken Spence Hotels
Malin Hapugoda said the CEB segregated the hotel sector from other
industries by charging a higher rate.
"It is not fair to discriminate the hotel industry which is
considered one of the main contributors to the economy. The hotel sector
wants the CEB to treat it as any other industry", he said.