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 Post subject: The crisis beyond our reach
 Post Posted: Mon Jul 17, 2006 1:01 am 
The crisis beyond our reach
Entire country may be total darkness by 2008

@ The Nation / 16Jul2006

“Although the Norochcholai coal power plant has started construction this year, it can only contribute to the National Grid by 2010 and by that time the country would already be in a deep power crisis.”

Ceylon Electricity Board, the main generator and the distributor of electricity in Sri Lanka is on the verge of a financial crisis as it entertains a daily loss of 50 million rupees due to heavy reliance on privately owned thermal power plants from which the board buys a unit at Rs. 22 and sells at Rs. 8.

Although Sri Lanka hails itself as a hydro-electric generator, 60 percent of the electricity is generated using diesel turbines and this is purchased from private power plants at a cost of 160 million rupees a day. Till 1992 the CEB generated sufficient amount of electricity to meet the demands of 33 percent of the households and 92 percent of the total electricity was generated using hydro-power. Now 76 percent of the households use electricity and the CEB is only able to meet 40 percent of the demand with hydro-power generated electricity. Add to that the growing demand for electricity is 600 households per day.

According to the CEB Engineers’ Union, 667MW power is purchased from private power plants and of this 585MW is thermal power. However, about 80MW power is generated annually which does not add up to the national grid. This is generated by small-scale hydro-plants and dendro plants and is distributed provincially.

Electricity bought at a price of 11 to 22 rupees, which could go up to 28 rupees is sold to the consumers at an average of eight rupees, thus gaining an average loss of 14 to 20 rupees per unit.

With the increasing fuel price in the world market, which adds up to the already steaming crisis at the Ceylon Petroleum Corporation, there is a great probability that thermal power price may continue to increase.
However, the hapless Power and Energy Minister John Seneviratne has only limited solutions for the impending power crisis that threatens to plunge the entire country into total darkness by 2008.

Minister Seneviratne said this power crisis is not an isolated issue faced only by Sri Lankans but a common problem that the entire region has to deal with. “The power crisis is currently faced by all the third world countries not only just Sri Lanka,” he said.

He stressed the need to take immediate measures to prepare the country for a future power crisis. “We have not increased the electricity bill since 2002 but the diesel prices have increased by three folds. It is a matter of either increasing the bill or the CEB going bankrupt,” he said.

“The other thing that we as consumers can do to solve this issue is to save electricity. We use more electricity than what the CEB can provide. And we waste a lot of power by unwanted and careless usage,” Seneviratne said.

He added that the waste of power in the industrial and trade sector amounts to 20 million rupees per day and the household waste is 15 million rupees. “If this waste can be checked we can save the CEB from this looming problem,” he said.

Although the Norochcholai coal power plant has started construction this year, it can only contribute to the National Grid by 2010 and by that time the country would already be in a deep power crisis.

The spokesperson for the JVP Union of the CEB, Ranjan Jayalal said that the ill maintenance of the main hydro-power plants by the CEB authorities is an additional reason for the escalation of the crisis and due to this reason the function of hydro-power plants have become inefficient.

The main hydro-power plants were set up in the 1950s and the machinery and the technology used are outdated and according to CEB sources to update these plants it would take at least 50 million rupees annually.
Another issue that was brought to notice was that the quantity of the electricity that is transmitted. Compared to other Asian countries, Sri Lanka is the only country that supplies electricity to over 75 percent of its population.

“Although the CEB is capable of meeting the electricity requirements of over 75 percent of the population the quality of the electricity is not up to standard.

CEB Trade Union Alliance Convenor, Ananda Wimalaratne disclosed that one of the additional reasons for the CEB to be at such a dire loss is the unpaid bills by certain local authorities and government institutions. He said that not only these institutions but also the common consumer is not paying the bills on time. “They remember to pay it only when they receive the red notice,” he said.

According to him, with the government institutions there are ways of collecting unpaid dues. These can be reduced from the payments that the CEB is due to pay the Treasury.

Plans for reforms

The Electricity Reforms Bill which proposed restructuring of the Electricity Board caused myriad controversies within the CEB and the power and energy sources. Due to protestations from the JVP-led unions, it was finally withdrawn and now the fate of the reforms and the promised loan from the Asian Development Bank has become uncertain.

“The government has decided to restructure the Ceylon Electricity Board with the hope of seeing a solution to the current crisis faced by the CEB. Hence we will somehow present it and get it passed.” Minister Seneviratne said.

But the CEB unions have also threatened that with the assistance of the CPC unions they will launch an islandwide strike if the government goes ahead with the bill and now the reforms have returned to square one.
The argument of the unions is that this is just another trick by the government to throw the CEB into the path of privatisation. “We are strongly against this bill. What they are trying to do is what the UNP government tried to do a few years back. The reforms will be the starting point of privatising the CEB, and we will not allow that,” General Secretary of the Union Ranjan Jayalal said.

Several meetings between President Mahinda Rajapaksa, the JVP MPs and trade union representatives on reaching a consensus on the proposed reforms ended in a stalemate as the JVP kept warning the President that if the bill is presented in parliament the JVP will vote against which would mean them going against the government for the first time in parliament.
The reforms envisage the breaking up of the CEB into several companies entrusted with the tasks of generation, transmission and distribution of electricity. The proposed bill will replace the existing Ceylon Electricity Board Act No. 17 of 1969.

Earlier the UNP government passed a bill to restructure the CEB in 2002 but its implementation was suspended after the change of government and heavy resistance from the unions mainly backed by the JVP.

Transmission loss

One of the other central issues that contribute to the power crisis in the country is the alleged loss of power during transmission. According to the CEB, the transmission loss of electricity is 17 percent of the total power generation.

CEB, Additional General Manager, Transmission, R J Gunawardana, explained that transmission loss is an issue that cannot be avoided. “This 17 percent is not transmission loss per se. It is the accumulative loss of generation, transmission and distribution,” Gunawardana said.

He disclosed that this is a low percentage when taking into consideration the average loss in other countries in the region like India, Pakistan and Bangladesh, which is very high. Several years ago the loss in India amounted to about 40 percent. However, with careful planning they have managed to bring it down to about 20.

“However, when we compare this figure with the entire world, it could be said that this is a high figure, especially when we take into consideration the loss in countries like Japan or the United States,” he said.

He added that both the generation loss which is only about one percent and the transmission loss which is about 3 – 4 percent are expected losses that cannot be done away with even in a technically advanced world. It is the distribution loss which is a staggering 13 percent that needs to be controlled. “To a certain degree, distribution loss too is unavoidable,” said Gunawardana, but there are certain steps that can be taken to minimise it.

According to him, when it comes to distribution there are two types of losses. One is technical loss and the other is non-technical loss. “Technical loss is inbuilt. When the electricity is distributed via wires, due to resistance in conductors, a certain percentage of energy is lost. On the other hand, since electricity is energy, when it travels through wires it is a natural occurrence that some of it is transformed to heat. This is a natural loss that cannot be prevented,” he said.

He explained that, if the distribution wires are old, small or overloaded, especially those which transmit a high voltage of 220v electricity long distance, the loss can be quite high. However, this can be reduced with careful planning and replacing old wires with new and better quality ones.
“Yet, this can be quite costly for the CEB. It requires huge investments. Although the government cannot afford to spend so much investment on this, the CEB is in the process of planning a maintenance project,” he said.

On the other hand, Gunawardana stressed the importance of controlling the losses occurring on the part of the customers. One of which is the theft of electricity from high voltage lines. This is extremely damaging to the distribution network. Systematic and careful raids should be conducted to avoid the escalation of these incidents.

He added that there are other preventable losses like errant wiring and faulty meters. These are damaging to both the customer and the CEB. Immediate attention must be given to these problems.

“If these measures were taken without delay the 17 percent loss of electricity occurring in Sri Lanka can be further reduced,” Gunawardana said.

According to CEB Trade Union Alliance Convenor, Ananda Wimalaratne, the thefts of electricity from main distribution lines are mostly happening in the Northern and Eastern regions. “Even the Army cannot go into those uncleared areas, so it is impossible for the CEB officials to go there and make inquiries. These are some of the problems that are beyond our reach to make remedies,” he said.

Completed Private Thermal Power projects

22 MW Power Plant by Lakdhanavi Private Limited
51 MW Power Plant by Asia Power Private Limited
60 MW Barge Mounted Power Plant by Colombo Power Private Limited
2x20 MW Power Plants by Ace Power Generation Horana (Pvt) Ltd and Ace Power Generation Matara Limited
10 MW Power Plant by Koolair Ventures Power Private Limited

Projects under construction

Ace Power Generation Anuradhapura (Pvt) Ltd.
Location: Horana
Capacity: 20 MW

AES Kelanitissa (Private) Limited
Plant Type: Combined Cycle
Location: Kelanitissa
Capacity: 163 MW

New Projects

Kerawalapitiya Combined Cycle Project - Pre-qualified Parties
Establishment of Wind Power Plant on BOO Basis

Related Articles:
:arrow: Power sector restructuring: Quo Vadis
:arrow: Delay in Upper Kotmale, Norochcholai is a disaster
:arrow: Rise and Fall of Ceylon Electricity Board (CEB)
:arrow: A loss of Rs. 45 million a day for CEB

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