Power sector reforms: CEB to be restructured into separate biz units?

  • TUs express concern about job losses
  • Remain opposed to restructuring 

By Maheesha Mudugamuwa

The long-delayed restructuring of the Ceylon Electricity Board (CEB) may see some divisions of the utility provider, with the enterprise being divided into separate business units, The Sunday Morning learns.

It is understood that the newly-appointed committee to oversee the restructuring may push the CEB to follow the business unit model which created Lanka Electricity Company (Pvt) Ltd. (LECO) – a more efficient and non-loss-making entity.

The CEB has been debt-ladened and inefficient in delivering power to its customers over the years. Annual load shedding and unplanned power outages have become the norm, with critics calling for a restructuring of the sector for decades.

The restructuring process commenced last week following Cabinet approval received for a proposal submitted by Power and Energy Minister Kanchana Wijesekera. 

Accordingly, the Cabinet has decided that a committee be appointed to propose reforms to restructure the power and energy sectors controlled by the CEB and Ceylon Petroleum Corporation (CPC) within a month.

Soon after Cabinet approval was granted, the new committee was appointed by the Power and Energy Ministry.

The committee comprises former Secretary of the Finance Ministry Dr. R.H.S. Samaratunge, former Secretary of the Power and Energy Ministry M.M.C. Ferdinando, former AGM of the CEB Dr. Susantha Perera, former Chairman of the Board of Investment Thilan Wijesinghe, Petroleum Development Authority Chairman and Port City Economic Commission Director Gen. Saliya Wickramasuriya, former Legal Consultant to the Public Enterprise Reforms Commission President’s Counsel Nihal Jayawardhane, former Senior State Counsel at the Attorney General’s Department Attorney-at-Law Harsha Fernando, and Power and Energy Director Chandana Wijesinghe.

The committee is required to submit its recommendations to the Cabinet within one month upon being appointed and the recommendations will later be presented to Parliament. The Cabinet of Ministers also approved the revised tariff rates for renewable energy projects last week.

However, power sector trade unions that The Sunday Morning spoke to expressed concern that excess staff at the CEB faced the risk of unemployment as the CEB may be terminated following the anticipated major restructuring process.

The restructuring would also stop new recruitments, bringing in new staff into the management to make the institution a viable business to provide electricity 24/7, it is learnt. 

When The Sunday Morning contacted the electricity regulator, the Public Utilities Commission of Sri Lanka (PUCSL), its Chairman Janaka Ratnayake said the commission was not involved with the restructuring process as it was being undertaken by the Cabinet.

He said the restructuring was needed as the CEB was incurring huge losses due to inefficiencies and mismanagement. The PUCSL Chairman said they expected that a proper system would fall into place once the restructuring was completed.

However, he downplayed the possibility that the committee planned to privatise the CEB.

“I don’t think they are talking about privatisation. They are talking about efficiently breaking the system into a few business units like LECO, which will bring efficiency and good management into the system,” Ratnayake said.

He added that the national power supply system was too big for one person to handle.

“Ideally, the general manager should be a technical person. The system should probably bring in new people into management and it should be a viable institution as we need electricity 24/7 without load shedding,” he said.

When asked whether it would result in reducing the number of staff, the PUCSL Chairman opined: “I don’t think that’s possible. They will probably stop new recruitments and let go of excess staff.”

Meanwhile, trade unions attached to the CEB urged the Government to ensure that the reforms would only focus on addressing the issue of efficiency and not privatisation.

When contacted, JVP-affiliated Lanka Viduli Sevaka Sangamaya (LVSS) President Ranjan Jayalal stressed that this may be another attempt at privatising the CEB. “They may be using different words. We are for restructuring as it should be done so as to match the present circumstances of the country, but this should not be aimed at privatising,” he said.

Jayalal stressed that when questioned, the CEB Chairman had been unaware of the restructuring process. “We are waiting for the recommendations,” he said.

Meanwhile, the CEB Engineers’ Union (CEBEU) too said they supported the restructuring process, provided it was done by experts in the field and not by politically-affiliated officials.

Speaking to The Sunday Morning, former President of the CEBEU and current Executive Committee member Saumya Kumarawadu stated that the restructuring of an institute such as the CEB should be undertaken by experts.

“Restructuring should be carefully handled by experts to make the institution a profitable entity following a thorough study,” Kumarawadu stressed.   

Attempts to contact CEB Chairman N.S. Ilangakoon were futile.