As much as public sector reforms are an integral part of Sri Lanka’s economic recovery process, during the past few months, during which time the Government started discussing some of the biggest reforms the country has seen, reforms that the country is in need of have also proven to be quite challenging and intricate. Among them, plans to reform the Ceylon Electricity Board (CEB), which has long been suffering astronomical losses, takes a special place.

Industry experts as well as economists opine that not only the CEB, but many aspects of the country’s power and energy sector need to be reformed, if the country is to salvage this sector in the context of the economic crisis and to achieve long term power sector targets such as renewable energy plans that play a considerable role in long term economic and power sector stability. Protecting electricity consumers remains a primary objective in this process, as their plight has only been increasing during the past one and a half years. As was reported, the authorities have come up with proposals to introduce reforms to address and prevent the recurrence of many challenges faced by the power sector, most notably, power cuts that lasted for over a year inconveniencing electricity consumers of almost all levels.

However, in response to the proposed amendments to the Sri Lanka Electricity Act, No. 20 of 2009, several parties have expressed concerns as to whether the Government is on the right path. The Public Utilities Commission of Sri Lanka (PUCSL) Chairman Janaka Ratnayake claimed this week that the enactment of the proposed amendments would result in a number of adverse results such as jeopardising the country's energy security, and reducing the priority given to the water-related needs of the farmers and the general public. Ratnayake further alleged that it would also lead to the establishment of a puppet like entity to regulate the power sector under the Energy Ministry, in place of an independent body such as the PUCSL. He further claimed that the proposed amendments will also completely abolish the CEB and transfer its resources to 14 more companies. The proposed amendments have also been critically questioned by CEB affiliated trade unions. Though their concerns are often viewed as attempts to save their own skin, this time, they question the transparency of the process of enacting the proposed amendments. According to the CEB Joint Trade Union Alliance, not even a concept paper related to the relevant draft amendment Bill has been provided to the relevant parties, including the CEB affiliated trade unions.

Although the Government’s reform plans are a need of the hour, what is not acceptable is this process of being a non-transparent, politically driven one, as has been alleged. Transparency should be at the centre of the discussions and decisions relating to CEB reforms, if the Government is serious about reversing the impacts of the wrong decisions made by successive Governments and the CEB, and furthermore, the Government must not forget that the lack of transparent decisions was one of the key factors that led to the energy sector’s downfall in the first place. Without the necessary form and level of transparency, which are necessary for all the relevant stakeholders to weigh in on CEB related reforms, the Government would be able to take any decision, including wrong and inefficient ones, which is a real threat to the country. Especially when it comes to a crucial sector such as the energy sector, not only can transparency be underestimated but the Government should also be accountable for its decisions and ensure that they are not arbitrary. At the same time, these concerns, especially those pointed out by the PUCSL, should not be considered as a threat to the Government or as a part of the tensions that exist between it and Ratnayake and the CEB affiliated trade unions. Allowing such disputes to get in the way of making the necessary decisions in a prudent manner would inevitably affect the entire country, as the energy sector has a direct impact on almost all sectors, and on the country’s day-to-day affairs.

The Government may be considering CEB related reforms as an opportunity for it to regain the public trust that it has lost. However, to achieve that, the Government should pay attention to geopolitical, national security, consumer rights and also economy related concerns pertaining to its decisions. At a time when the country’s national electricity grid is being considered to be connected to India’s grid in the foreseeable future, Sri Lanka needs to have a robust regulatory mechanism that is independent and scientific. That could be achieved not by getting rid of the oversight of independent Commissions such as the PUCSL, but by streamlining and strengthening their operations.