Renewable energy:

Empowering solar power

Wind and solar energy are increasingly competitive. But a lot has to change before they can make a real impact:

by Rukshana Rizwie

Sri Lanka has set a futuristic and progressive task of increasing its share of renewable energy in electricity generation to 100% by 2030; energy experts however, opine that lack of transparency and willingness to pursue competitive bidding continue to restrict an industry which could have grown in leaps and bounds.

At the 2nd meeting of SAARC Energy Regulators’ meeting which was held in Colombo, M.I.M. Rafeek, Secretary, Ministry of National Policies and Economic Affairs told a gathering that Sri Lanka was seeking to accomplish an enviable target of increasing its share of electricity generation from renewable energy sources to 60 % by 2020, and 100 % by 2030. According to the Ceylon Electricity Board (CEB), by the end of 2015, renewable energy made a contribution of only 448.279 megawatts out of 173 commissioned projects.

Deputy Director General for Strategy at Sri Lanka Sustainable Energy Authority (SEA), Harsha Wickramasinghe told the Sunday Observer, while there has been a steady stream of private investors showing a keen interest, there exists a lack of transparency in the local market, which tends to ward off foreign firms.

“The prices paid to suppliers are not competitive enough,” he said. “It is this dearth in competition which continues to curtail the development of renewable energy in the country and portrays our market as closed, monopolized or restricted.”

Wickramasinghe added that the SEA has pioneered a pilot project in Hambantota which paved the way for three separate solar power projects of which one 10 megawatt plant would be connected to the National Grid by September.

According to the CEB, the proposed Long-term Generation Expansion Plan for 2015-2034 is expected to increase the renewable energy capacity to 972 MW by 2020, which would contribute 20% to the total power generation in the country. Renewable energy’s share in power generation is expected to peak in 2025 at 21.4% with an installed capacity of 1,367 MW. Between 2025 and 2034, share of renewable energy in power generation is expected to reduce marginally from 21.4% to 20.0%.

In 2015 however, commissioned mini hydro projects contributed 299.4 megawatts through 147 projects, i.e. wind power 123 megawatts, biomass (agricultural and industrial waste) 13 megawatts and solar only 1.3 megwatts. In 2014, out of the country’s total installed power generation capacity, only 11% was based on renewable energy.

The situation however was not as bleak as the stats showed, Wickramasinghe said. Earlier this year, the Board of Investments (BOI) had received six proposals valued at US Dollars 4.5 Billion for the setting up of several power projects that would generate 2,000 megawatts of power. BOI Chairman,, Upul Jayasuriya said, based on the interest shown by foreign investors and the proposals that have been received thus far, power generation in the country could be doubled in three years from now, when the projects will be commissioned. Among the proposals that have been received, many are in favour of setting up the Liquid Natural Gas (LNG) power generation projects.

Despite the many large scale projects that have been proposed, Sarath Chandrasena, an energy expert and former national expert for the United Nations Industrial Development Organization on renewable energy says, restrictive practices and corruption continue to plague the renewable energy industry.

“There was a policy decision to restrict solar power projects between 2 megawatts to 5 megawatts,” he said. “Earlier, it used to be 10 megawatts, however under the previous political context any project that had more than 5 megawatts would be open for competitive bidding.”

This practice he said, discouraged investors, because each time a suitable location was sought and proposals made, bids were invited. He added that time was a quintessential factor and the fact that projects took too long to see the light of day, was discouraging enough.

He attributed the lack of interest in renewable energy from the private sector to the lack of encouragement from the country’s two main powerhouses. “It’s a known fact that the CEB is not in favour of pursuing solar or renewable energy,” he said. “It’s a huge loss to the CEB, as they spend Rs 17 per unit for generation, Rs 10 - Rs 15 which would be lost during transmission, but sell it at Rs. 3”

He said, the government didn’t have a plan or strategy in place to develop the solar power industry, and that standard power purchase agreements between the CEB and independent power producers have become fewer and far between.

A Director at the CEB who did not wish to be identified said, the Board was not keen on pursuing sources of renewable energy, unless it was a directive from the government.

“These are intermittent resources and we have no intention of clogging an unstable national grid unless we have enough power plant to back it up in case it falters,” he said. “We have stipulated a limit and will not transgress it by inviting or including many plants.”

He added, since the CEB has announced high tariffs for renewable, there was a lot of pressure to include more renewable, not for the sake of clean energy but dirty money. “At present only 20% of the total energy demand can and will be catered to by renewable sources,” he said. “Everyone has forgotten that we were generating 100% of our energy from renewable from hydro.”

“At present many of the proposals are not technically sound or economical,” he said.