The State utility provider, Ceylon Electricity Board (CEB) has once again announced a tariff revision with effect from yesterday (17), with plans afoot for another tariff revision in October. 

The reduction of electricity tariff is a welcomed move, with many Sri Lankans struggling to pay their energy bills. The 22.5% reduction is a relief for those who benefit directly and indirectly from electricity sale. According to the Minister of Power and Energy Kanchana Wijesekera those consuming less than 90 units of electricity would have benefited the most from the recent electricity amendment. Looking ahead, Wijesekara said that further reducing electricity tariff lies in lowering generation costs, which necessitates the rapid establishment of cost-effective power plants.

The new facilities are projected to be operational within the next three years, promising additional reductions in electricity charges thereafter.

Many, especially in the low income communities have reduced electricity consumption to a bare minimum, or have completely stopped using it over the last year, due to significant tariff increases. The electricity tariff increases, which came after a hiatus of almost a decade, took Sri Lanka by storm, kicking many small- and medium-scale enterprises a gut punch, and leaving many unable to literally keep lights on and be competitive at the same time. The butterfly effect from the tariff increase, sent shockwaves through the retail and services sector, as vendors and service providers lost no time, increasing their prices to reflect the surge of the electricity bill.  The resulting jolt the average Joe in Sri Lanka felt when he or she tried to purchase goods, food or services, has never really gone away, as prices have stagnated at elevated levels ever since.

Businesses were yesterday urged to pass on the benefits from the recent electricity tariff reduction to consumers, who are grappling with the high cost of living. However, in Sri Lanka, the norm has been that businesses quickly increase prices at the slightest rise in utility tariff, but are reluctant to reduce them. This, while a recent fuel price revision saw petrol, diesel and kerosene prices dropped without leading to lower consumer prices. Therefore, with the substantial decrease in electricity costs this year, the Government has urged the public to take advantage of these savings, with potential for at least a 20% reduction in overall expenses. However, businesses and the retail sector in Sri Lanka are yet to reduce their prices. Nevertheless, it must be noted that the price of several food items have seen a change over the last week.

This scenario, one which has played over and over again, in Sri Lanka, leaves the consumer, now battered and bruised by the economic crises and a global pandemic, at the mercy of profit seeking vendors. The reality is that many commodities, services and day to day necessities remain on the shelves, out of reach to the customer due to it’s jacked up price. It is high-time that all industrial bodies, chambers of commerce, and the politicians who spoke up in favour of price increases for vendors to ‘stay afloat,’ and sought relief for businesses, turn their attention to the plight of the common man, who await for the electricity and fuel price reductions to trickle down to them, at the market and shop. 

This is an opportune time for industry bodies, and the business community to craft a self-regulatory mechanism, to ensure that the customer is provided an affordable price. It is also prudent for the state regulatory mechanism, to wake up from its slumber and start working in the interest of the consumer. Due to their inaction, and the prices still remaining bloated, the public have begun to question, who really benefits from the tariff and fuel price reductions? This also applies to the cost of transport, goods and people. Should there not be a tangible reduction in the charges for public transport? With electricity costs also dropping, vendors and service providers are running out of answers and the public remains frustrated. The Government should act now to ensure that everyone gets a share of the relief. That is the just and right thing to do.