• Timeline to shut down power plant under LTGEP

A separate company is set to be established to manage operations at Sri Lanka’s only coal power plant, Lakvijaya in Norochcholai, The Sunday Morning has learnt.  

It is reliably learnt that the Government does not intend to hand over control to its Chinese builders, the China Machinery Engineering Corporation (CMEC). 

Instead, plans are in the pipeline to conduct a proper valuation of the plant and initiate an open tender process. 

Furthermore, the Ministry of Power and Energy confirmed yesterday (1) that no proposals had been received from the CMEC regarding the plant’s future management.

The inception of the Lakvijaya Coal Power Plant dates back to 1995 when it was initially proposed. Construction commenced in 2007 and the facility was completed in three phases, culminating in September 2014, with a total power generation capacity of 900 MW.

Despite its large capacity, the power plant has been plagued by frequent shutdowns since its commissioning in December 2011.

Reports indicate that the plant has experienced over 20 breakdowns, leading to substantial financial losses for the Ceylon Electricity Board (CEB) and significant disruptions in the country’s power supply.

Responding to a query by The Sunday Morning, Ministry of Power and Energy Secretary Dr. Sulakshana Jayawardena acknowledged the existence of a plan to establish a separate company for the operation and maintenance of the Norochcholai Plant.

However, he expressed uncertainty about whether such a plan would gain approval from Parliament. “I think the Government will make a prudent decision as this is the largest capacity we have,” Dr. Jayawardena emphasised.

Elaborating on the proposal, the Secretary explained: “The plan was to establish a separate company for Lakvijaya to generate electricity and bring down coal requirements.”

“We have signed a carbon impact agreement with other countries. It is an international treaty, and according to that we can’t have a new coal power plant in the country. Also, under the Long-Term Generation Expansion Plan (LTGEP), there is a timeline to shut down this coal power plant in future, considering carbon neutrality and renewable energy capacity addition. Until such time, the coal power plant will not be dismantled,” Dr. Jayawardena said.

When asked whether the Government was planning to hand it over to its builders, the CMEC, the Secretary emphasised: “We won’t hand it over to CMEC for a proposal as we need to do a valuation. We can’t merely transfer national assets. We need to follow the proper procedure and it will take time as we will have to have a transfer plan and valuation.”

“I can’t predict what will happen in Parliament and whether the Legislature will pass it or not, but the proposal is to have a separate company to operate and maintain it,” he added.

As of last Friday (31 May), according to CEB statistics, the electricity generated from coal amounted to 12.93 GWh, representing 26.7% of the total electricity requirement of the country. 

However, during the previous dry season, coal power generation increased to over 40% of the total requirement. Coal power is recognised as the second cheapest power source in the country.

Former President Gotabaya Rajapaksa halted a coal project, which aimed to expand the Norochcholai Coal Power Plant, despite 80% of the initial work being completed. This decision came after Cabinet approvals in 2019 and 2020, with plans for a 300 MW extension and a concessionary loan from China. 

The proposal involved seeking technical and commercial proposals from the CMEC, with committees appointed to evaluate them. This move was intended to address the high power generation costs and financial challenges faced by the CEB and the Ceylon Petroleum Corporation (CPC).

Prior to this, in 2015, former President Maithripala Sirisena cancelled a 500 MW Sampur Coal Power Plant project and a controversial economic committee under Prime Minister Ranil Wickremesinghe had opposed coal usage.