• Subject Minister Kanchana forecasts Rs. 722 bn revenue in 2023
• Says energy demand expected to drop by 4%

The Ceylon Electricity Board (CEB) would have made a loss of Rs. 287 billion in the year 2023 if it continued to supply power at the previously hiked tariff rate, Minister of Power and Energy Kanchana Wijesekara stated in Parliament yesterday (8).

Wijesekara said that if CEB had continued its operation based on last year’s tariff hike of 75%, it was estimated that the CEB would incur a loss of Rs. 287 billion in 2023 compared to the Rs. 167.2 billion loss incurred in 2022.

He added that if factors considered to calculate the loss of Rs. 287 billion under the old tariff – such as the annual rainfall, price, the continuous supply of coal and fuel, maintenance of the generation sector, transmission difficulties, electricity generated through renewable energy – were to remain the same with the new tariffs, the CEB would likely operate without any losses.

Further, the CEB is expecting an annual revenue of Rs. 722 billion in 2023 as a result of the recent tariff hike while expecting a 4% reduction in power demand compared to 2022.

Moreover, he said that the CEB has forecasted a power demand of 16,520 GWh for 2023, which is 5% less than in 2021 and 4% less than in 2022.

Also, he noted that the CEB is expecting to fulfil 27% of the total demand by hydropower, 13% by fuel power plants, 28% by coal, 2% by wind power, 12% by private fuel power plants, 13% by contracted renewable energy providers, and 4% by solar panels installed on roofs. 

“The forecast was based on the assumption that the economy would contract by 4% of the gross domestic product (GDP) in 2023 while predicting usual annual rainfall, expecting 30 coal shipments to arrive at the country in 2023, continuous providing of naphtha and diesel to the Kelanitissa power plant, and supplying 110 MW of additional power to the Southern Province,” he added.

Wijesekara further said that the recent tariff hike has increased the electricity bills of households by 87%, by 64% for religious places, by 55% for general purposes, by 62% for state institutions, by 35% for industries, by 66% for hotels, and by 49% for the agriculture sector.

He noted that providing cross-subsidies to low-income households consuming less number of electricity units through their electricity bill is not an efficient way of doing so, as holiday homes owned by the rich will also receive cross-subsidies through that method.

“Therefore, the Government has decided to provide cross-subsidies for low-income households directly,” he added.