• Notes reduction in CEB forecast

Electricity consumers should receive an immediate electricity tariff reduction by approximately 20%, given the recent reduction in the demand for electricity, foreign exchange rates and fuel prices, said the Public Utilities Commission of Sri Lanka (PUCSL) Chairman, Janaka Ratnayake.

Issuing a statement, he said: “According to the tariff hike requested by the Ceylon Electricity Board (CEB) in January, an electricity demand of gigawatt hours (GWh) 16,520 had been estimated for 2023, expecting a revenue of Rs. 722 billion, but the PUCSL forecasted a generation demand of GWh 15,031.42 for 2023. Our demand forecast has been proven by the actual demand from January to April. According to the CEB’s revised demand forecast, the total demand for year 2023 will be GWh 15,377 which is very close to the demand that we forecasted early this year. That was the main rationale in our staff’s tariff recommendation which limited a tariff increase below 35%."

He said that the said data prove that the 35% tariff increase suggested by the PUCSL is on par with the actual demand forecast which however did not materialise due to the majority of the PUCSL members approving the CEB's proposal as it was. 

"The latest forecast by the CEB shows a reduction of 6% from the initial forecast in January. In March and April, the actual generation was 10% and 8% less than the initial forecast by the CEB, respectively. Accordingly, the latest forecast is also on the higher side and the actual demand for 2023 can be even lower. Therefore, the actual total revenue could be lower than Rs. 658 billion. Given all those facts, we demand an immediate reduction of the electricity tariff by 20%," he added.

Issuing a statement, Ratnayake recently said that as per the actual data for the first quarter of the year, the electricity demand in the country had dropped by 18% in comparison to 2022, explaining that this reduces the reliance on high cost, oil fired thermal electricity generation. Further noting that the United States Dollar exchange rate had gone down from Rs. 370 per dollar to around Rs. 325 per dollar, which was a 13% reduction, he said that the same brings down fuel and other import costs of the CEB, thereby reducing the costs by about 20% per annum. In addition to those two cost drivers, he said that the international fuel prices too had reduced significantly, and that as a result, the fuel costs to the CEB would reduce significantly.

Speaking to The Daily Morning, a senior official of the CEB commented on this stating that a decision with regard to such a request could not be made without having discussions with the relevant parties. "This is something that has to be discussed. We cannot make a comment on this kind of a matter just because someone has made a request. All we can say is that the CEB has received the relevant letter. We will look into the matter and make a decision. Once a decision is made, we will inform everyone including the public," he added.