Sri Lanka is once again planning to increase electricity tariffs, and multiple factions have warned that the country is likely to face a serious electricity crisis.
The main reason for the crisis is the issue surrounding the procurement of coal for the Norochcholai Coal Power-Plant.
Janaka Ratnayake, the Chairman of the Public Utilities Commission of Sri Lanka told reporters on Thursday (1) that Sri Lanka needs 38 coal shipments before the 30th of April 2023. “From April to August we cannot unload coal due to the off season. Therefore, at least 30 shipments must reach the country soon, if not we will have to go for extended power cuts.”
Sri Lanka’s state-run Lanka Coal Company awarded a tender to Black Sand Commodities Company on the 10th of August for coal procurement, however, it was later terminated due to concerns over the methodology in awarding the tender.
The tender was for six months.
After this tender fell through, Lanka Coal Company called for two long-term and short-term tenders, and both failed.
Therefore, Lanka Coal Company has to pay cash upfront for 21 coal shipments to procure coal from the previous supplier.
In addition, Lanka Coal Company had to settle its dues for 2021 to the supplier, while it also owes some USD 14 Million to the same supplier.
Lanka Coal Company said that the country is not in a position to may dollar or rupee payments to make those purchases.
Lanka Coal Company says that six shipments must reach Sri Lanka monthly before the off-season, and as per the calculations around 12 shipments should have already reached Sri Lankan shores.
However, the dollar and rupee crisis had made it possible to only access half of those shipments.
Lanka Coal Company warned that the existing stocks of coal will only be sufficient until 20th January 2023.
“If we do not receive these 38 shipments by the 15th of April, come July, or August 2023 we will have to go for extremely lengthy power cuts. If would become the longest power cut in history. That is why we warn that we will have a Dark July in 20213,” warned Nihal Weeraratne the Chairman of the CEB Engineer’s Union.
The Public Utilities Commission of Sri Lanka said that it approved a power cut of two hours and twenty minutes daily for Thursday (1) and Friday (2).
However, Power and Energy Minister Kanchana Wijesekera tweeted on Wednesday (30) that power cuts will take place until the 15th of December.
The tweet also noted that the nighttime power cut will not apply to the southern, and Ella tourist areas.