News

Renewable energy systems on Jaffna islands: Chinese company to win the day   

  • Tender cancellation will lead to CEB being sued  

  • No decision from relevant committee yet  

  • Indian grant offer never went to Cabinet: CEB Chair  

  • Indian bidder unqualified  

By Maheesha Mudugamuwa  

 

Despite diplomatic concerns raised, India is unlikely to receive the energy deal won by a Chinese company early this year to set up three hybrid renewable energy systems mixed with solar, wind, and other renewables on three islands in the Jaffna Peninsula, The Sunday Morning learnt.  

It is also learnt that diplomatic attempts by India to prevent the awarding of the said energy deal to China are dwindling, as the Sri Lankan Government is delaying the cancelling of the Chinese contract despite assurances that were given by India to fully fund the project by way of a grant.  

The Sunday Morning learnt that it is near impossible to cancel an already finalised energy deal, as in the case of a cancellation, the Government would ultimately end up in a legal battle since the tender has been finalised following the completion of the international standard tender process.  

The cancellation of such a tender would be a violation of the ongoing tender process and it would pave the way for the respective company to file legal action against the Ceylon Electricity Board (CEB), it is learnt.  

The $ 12 million project has been awarded to MS/Sinosoar-Etechwin Joint Venture in China. Under the project, international competitive bids were called to install hybrid renewable energy systems in the three said islands, utilising the accessible energy resources to improve the efficiency of the prevailing energy network. The project is to be funded by the Asian Development Bank (ADB).  

No sooner that the tender was awarded, India raised security related concerns, as the islands concerned – Delft, Analaitivu and Nainativu – are in close proximity to the Indian coast, separated by the Palk Strait. The Delft island is only 48 km away from the Indian coastal town of Rameswaram.  

However, when The Sunday Morning contacted the CEB Chairman Eng. Vijitha Herath to ascertain whether the project has seen any development recently, he stressed that there was no final decision taken as of yet.  

“A committee has been appointed to look into this, and we have already given our explanation, as there is an actual demand for a mixed energy project on these three islands,” he said.  

Herath also noted that the projects have been awarded to the Chinese company after following an internationally approved bidding process, adding that they have been approved by a Cabinet Appointed Standing Committee on Procurement, hence making the entire process transparent.  

He also said that the decision to award such a project to develop hybrid renewable energy systems was taken after taking into consideration the success of a pilot project conducted in Eluvaitivu.  

Herath stressed that if the project is cancelled, the company would resort to legal action.  

He said that the Indian proposal was not submitted to Cabinet. Herath explained that although the project had initially come as a grant, the situation and position regarding the matter had subsequently changed.  

As learnt by The Sunday Morning, the Indian company that had submitted bids for the project was not qualified, as it had not fulfilled the bidding conditions. 

Meanwhile, on an earlier occasion, Minister of Power Dullas Alahapperuma had said that he had received a proposal from India offering the amount of $ 12 million as a grant or as part of the credit line worth $ 100 million. 

When contacted by The Sunday Morning, Co- Cabinet Spokesman Media Minister Keheliya Rambukwella confirmed that the project had not come to Cabinet yet. He however said the relevant Ministry has not taken a final decision on the project yet either. 

Meanwhile, attempts made by The Sunday Morning to contact Minister of Power Dullas Alahapperuma and the State Minister of Solar Power, Wind, and Hydro Power Generation Projects Development Duminda Dissanayake were futile.