By Anuradha Hiripitiyage
Electricity tariffs should be reduced by between 3 and 5 percent instead of being increased by 2.88 percent in the fourth quarter, as proposed by the National System Operator (NSO), Electricity Consumers’ Association Secretary Sanjeewa Dhammika said.
Addressing a media briefing in Maradagahamula, Divulapitiya, Gampaha, yesterday (16), Dhammika said a proper assessment of electricity generation costs, including the contribution of hydropower, could justify a reduction in tariffs.
He said the NSO had sought approval from the Public Utilities Commission of Sri Lanka (PUCSL) for a 2.88 percent tariff increase, which was expected to generate an additional Rs. 4,438 million.
However, the Commission had indicated that an increase of only 1.46 percent was warranted, amounting to Rs. 2,245 million, he said, adding that even this increase was unnecessary.
Dhammika alleged that the proposed revision sought to pass on to electricity consumers the financial burden arising from the non-arrival of five coal shipments and failed tenders.
“The Government had said that the burden of coal-related losses would not be passed on to the public. It is therefore unjust to make consumers bear these costs,” he said.
He pointed out that the PUCSL had forecast that hydropower would account for 32.34 percent of total electricity generation in the coming quarter, while the cost of such generation would represent only 3.45 percent of the overall cost of electricity production.
Consumers should benefit from the lower cost of hydropower generation rather than bear the burden of more expensive thermal power generation, he said.
Dhammika also questioned the inclusion of Rs. 669 million in capacity charges that had not been approved by the PUCSL, as well as a further Rs. 1,069 million to repay loans relating to incomplete projects.
Including such charges in the proposed tariff revision was unjustifiable, he said.
The PUCSL has given the public until October 30 to submit their views on the proposed tariff revision.
Dhammika said the possibility of increased hydropower generation in the coming weeks, as reservoir levels rise, should also be taken into account when determining electricity tariffs.
He maintained that tariffs could be reduced by 3 to 5 percent if hydropower generation was properly assessed and coal-related losses and unapproved charges were excluded from the calculations.
He further claimed that electricity tariffs could be reduced by as much as 10 percent through the promotion of renewable energy and the effective use of solar power and battery storage systems.
The Electricity Consumers’ Association urged the Government to withdraw the proposed tariff increase, insisting that consumers should not be made to bear costs arising from coal supply problems and other disputed charges.