The State-run Ceylon Electricity Board (CEB) is unlikely to receive an immediate 10% increase in electricity tariffs in June, despite President Anura Kumara Dissanayake’s recent announcement, as the Public Utilities Commission of Sri Lanka (PUCSL) clarified that any revision required a formal tariff submission from the CEB.
“We cannot act without a formal submission,” PUCSL Director General Damitha Kumarasinghe told The Sunday Morning, referring to the CEB’s failure to submit a proposal in February – an omission that limits the scope for any interim tariff adjustment.
While President Dissanayake stated during a television programme that electricity tariffs would increase in June, he also assured that post-June rates would still be lower than those in December 2023.
He added that the CEB would submit its tariff proposal by 15 May and that the PUCSL was expected to make a decision within two weeks of submission.
The President further explained that tariffs had been reduced by 20-30% in January and that the same amounts would not be added back in the upcoming revision.
However, PUCSL Director General Kumarasinghe elaborated on the workings of the Bulk Supply Transaction Account (BSTA), through which consumer payments were allocated to generation, transmission, and distribution.
If the BSTA balance fluctuates beyond ±15%, the PUCSL can authorise a temporary tariff adjustment of up to 10%. However, he stressed that this mechanism could not replace a full tariff review. Since the February submission was missed, this route is no longer available.
Commenting on the CEB’s reported losses, Kumarasinghe noted that while the International Monetary Fund (IMF) expected quarterly profitability, such expectations were not always technically feasible. “Tariffs are based on forecasts influenced by external factors like global oil prices and exchange rate volatility,” he said.
He further clarified that Sri Lankan law mandated cost-reflective tariffs over a longer horizon, typically up to two years, rather than quarter-by-quarter profitability.
“The Electricity Act clearly states that only ‘efficient costs’ can be passed on to consumers,” he said, adding that inefficiencies – such as unnecessary fuel usage or delays in planned projects – would not be considered in tariff decisions.
Kumarasinghe also addressed public concerns over the curtailment of rooftop solar power, confirming that the PUCSL had requested a detailed report from the CEB to assess the losses incurred. Due to the initial report being incomplete, additional data has been requested.
He also criticised delays in implementing renewable energy and battery storage infrastructure. “If these projects were part of the 2024 and 2025 generation plans but haven’t been executed, we must question whether these delays are prudent or efficient,” he said.
Kumarasinghe also reiterated that the PUCSL’s role was not guaranteeing CEB profitability, but involved ensuring fairness and transparency. “We must strike a balance between protecting consumers and maintaining the utility’s sustainability. Inefficiencies will not be passed on through tariffs,” he added.