POWER AND ENERGY SECTOR

I think the Govt. should seriously consider the privatization of the CEB if they really want to give power to people at a reasonable cost. Then only the Govt. can stop large scale waste & curruption and controle CEB engineering mafia.

Look at the privatization of bus transport. Private bus operators run their business with profit without any grant from the Govt., while SLCTB is unable to earn even an opertional profit with all Govt grants and subsidies not available to the private busses.

Food for thought, Hon. Minister Champika!

K.Haputantri wrote:I think the Govt. should seriously consider the privatization of the CEB if they really want to give power to people at a reasonable cost. Then only the Govt. can stop large scale waste & curruption and controle CEB engineering mafia.

Look at the privatization of bus transport. Private bus operators run their business with profit without any grant from the Govt., while SLCTB is unable to earn even an opertional profit with all Govt grants and subsidies not available to the private busses.

Food for thought, Hon. Minister Champika!

Which is happened and happening in the western economy.
Chinese government backed companies are buying the UK water,gas and electricity govt stakes.
Global economy is moving not like traditioal as we think but our politicians are talking nonsence.

CEB to stop private power purchases in 2013-2014.
So what does this mean to PAP, VLL and other power companies?

What will happen to the share holders?

http://www.sundaytimes.lk/120812/business-times/ceb-to-stop-private-power-purchases-in-2013-2014-8155.html

If it happens as it's been said, share holders will be payed back according to navps?

ccsentha wrote:CEB to stop private power purchases in 2013-2014.
So what does this mean to PAP, VLL and other power companies?

What will happen to the share holders?

http://www.sundaytimes.lk/120812/business-times/ceb-to-stop-private-power-purchases-in-2013-2014-8155.html

As I understood, this article was not talking about mini hydro power plants. PAP, VLL, VPEL, MEL, HPFL and part of HPWR are mini hydro power plants.

As I understood, CEB is going to stop power purchase from thermal power plants. HPWR has both thermal and hydro power plants.

Monster wrote:

ccsentha wrote:CEB to stop private power purchases in 2013-2014.
So what does this mean to PAP, VLL and other power companies?

What will happen to the share holders?

http://www.sundaytimes.lk/120812/business-times/ceb-to-stop-private-power-purchases-in-2013-2014-8155.html

As I understood, this article was not talking about mini hydro power plants. PAP, VLL, VPEL, MEL, HPFL and part of HPWR are mini hydro power plants.

As I understood, CEB is going to stop power purchase from thermal power plants. HPWR has both thermal and hydro power plants.

Are you sure about it?

August 12, 2012 (LBO) – Sri Lanka’s power minister has sought cabinet approval to raise state-run Ceylon Electricity Board’s borrowing limit to 74.2 billion rupees to meet increasing fuel needs, settle debts and pay independent power producers, a report said.

Minister Champika Ranawaka told his cabinet colleagues that the state power utility owed 16 billion rupees to independent power producers and another 15 billion rupees to state-run Ceylon Petroleum Corporation, the Colombo-based Sunday Times newspaper said.

The higher borrowing limit will be used to meet:
- Overdraft and term loans – 45 billion rupees
- Provision for letters of credit -- 10 million rupees
- New guarantees for independent power producers -- 19.2 million rupees

The minister blamed the heavy costs on the prevailing drought that has limited hydro power generation. The CEB is now depending on expensive thermal power to provide uninterrupted electricity supply to the country.

“As payables to independent power producers have reached peak level, purchasing of fuel from CPC for thermal generation has been limited. IPPs have utilised their credit limit to maximum level,” Ranawaka was quoted in the report.

The CEB has secured a 20 billion rupee short-term loan facility from state-run People’s Bank PLC during past few months, to settle these liabilities to CPC, the independent power producers and to import coal.

The short-term loan was used to settle:
- Overdraft of 800 million rupees
- Term Loans of 5.410 billion rupees
- Short Term Loan Facility (Bill Discounting) of 20.454 billion rupees

Ranawaka said a 10 billion rupee Letter of Credit/Guarantee has been fully utilised. Only a standby letter of credit facility of 18 billion rupees has not been utilised.

As a temporary measure, the CEB had approached People’s Bank for a term loan facility, to partly settle the CPC and the independent power producers.

However, People’s Bank had rejected the request since it goes above the single borrower limit enforced by the Central Bank of Sri Lanka.

“Hence Minister Ranawaka wants his ministerial colleagues to approve his request to ask the Governor of the Central Bank to increase the single borrower limit to the CEB to 74.2 billion rupees,” the report said.

Ranawaka said the CEB was in “severe financial crisis” despite imposing a fuel surcharge between 15 percent to 40 percent in February to trim losses.

The minister said there were broadly four reasons for the financial crunch:
1. Increase of cost of independent power producers and CEB fuel due to increase of fuel prices by CPC and increase of thermal generation due to prevailing drought situation in the country.
2. Additional revenue on Fuel Adjustment Charge is not sufficient to cover the increased fuel cost.
3. Non-receipt of subsidy from the Government for 2011.
4. Use of CEB funds for capital works for which Government funds were not received.

Ranawaka’s shocking disclosure comes as CEB trade unions are once again demanding a substantial pay hike.
http://lbo.lk/fullstory.php?nid=445303843

It is good if this can be achieved.There is no need to privatise the CEB as a whole.Government should keep the ownership.

As for the example of private buses We know how they work especially during nights....how they drive the buses in competition....

Whitebull wrote:It is good if this can be achieved.There is no need to privatise the CEB as a whole.Government should keep the ownership.

As for the example of private buses We know how they work especially during nights....how they drive the buses in competition....

You are correct but let me elaborate a little on the reason behind this poor night services and competition amomg buses.

Private bus industry consists of thousands of single bus operators who put-in their lifelong savings to the business with bank loans + finance leases with-out any Gove. grants. They should opertate with a reasonable profit to service their loans/leases. Hence, heavy competition among them. It is the crew who gets the most part of the income and the owner is given a fixed agreed amount sufficient to meet his capital investment. Unless the NTC(regulator) does something to organize the private bus industry into manageable company structure this situation will prevail. With all this issues they have been competing with the SLCTB heavily dependant on the Govt. even to pay their salaries.

Govt. Budget deficit willn be at manageable level if SLCTB, CEB & CPC is privatised.

I think the Govt. should seriously consider the privatization of the CEB if they really want to give power to people at a reasonable cost. Then only the Govt. can stop large scale waste & curruption and controle CEB engineering mafia.

Look at the privatization of bus transport. Private bus operators run their business with profit without any grant from the Govt., while SLCTB is unable to earn even an opertional profit with all Govt grants and subsidies not available to the private busses.

Food for thought, Hon. Minister Champika!

K.Haputantri wrote:I think the Govt. should seriously consider the privatization of the CEB if they really want to give power to people at a reasonable cost. Then only the Govt. can stop large scale waste & curruption and controle CEB engineering mafia.

Look at the privatization of bus transport. Private bus operators run their business with profit without any grant from the Govt., while SLCTB is unable to earn even an opertional profit with all Govt grants and subsidies not available to the private busses.

Food for thought, Hon. Minister Champika!

Agree with you. But you know our majority of Sri Lankan people dont like the word privatisation.

institutes like CPC, CEB, CTB, Air lanka should be privatised & the selling stake should be less than 49%.

August 12, 2012 (LBO) – Sri Lanka’s power minister has sought cabinet approval to raise state-run Ceylon Electricity Board’s borrowing limit to 74.2 billion rupees to meet increasing fuel needs, settle debts and pay independent power producers, a report said.

Minister Champika Ranawaka told his cabinet colleagues that the state power utility owed 16 billion rupees to independent power producers and another 15 billion rupees to state-run Ceylon Petroleum Corporation, the Colombo-based Sunday Times newspaper said.
The higher borrowing limit will be used to meet:
- Overdraft and term loans – 45 billion rupees
- Provision for letters of credit -- 10 million rupees
- New guarantees for independent power producers -- 19.2 million rupees

The minister blamed the heavy costs on the prevailing drought that has limited hydro power generation. The CEB is now depending on expensive thermal power to provide uninterrupted electricity supply to the country.

“As payables to independent power producers have reached peak level, purchasing of fuel from CPC for thermal generation has been limited. IPPs have utilised their credit limit to maximum level,” Ranawaka was quoted in the report.

The CEB has secured a 20 billion rupee short-term loan facility from state-run People’s Bank PLC during past few months, to settle these liabilities to CPC, the independent power producers and to import coal.

The short-term loan was used to settle:
- Overdraft of 800 million rupees
- Term Loans of 5.410 billion rupees
- Short Term Loan Facility (Bill Discounting) of 20.454 billion rupees
Ranawaka said a 10 billion rupee Letter of Credit/Guarantee has been fully utilised. Only a standby letter of credit facility of 18 billion rupees has not been utilised.

As a temporary measure, the CEB had approached People’s Bank for a term loan facility, to partly settle the CPC and the independent power producers.

However, People’s Bank had rejected the request since it goes above the single borrower limit enforced by the Central Bank of Sri Lanka.

“Hence Minister Ranawaka wants his ministerial colleagues to approve his request to ask the Governor of the Central Bank to increase the single borrower limit to the CEB to 74.2 billion rupees,” the report said.

Ranawaka said the CEB was in “severe financial crisis” despite imposing a fuel surcharge between 15 percent to 40 percent in February to trim losses.

The minister said there were broadly four reasons for the financial crunch:
1. Increase of cost of independent power producers and CEB fuel due to increase of fuel prices by CPC and increase of thermal generation due to prevailing drought situation in the country.
2. Additional revenue on Fuel Adjustment Charge is not sufficient to cover the increased fuel cost.
3. Non-receipt of subsidy from the Government for 2011.
4. Use of CEB funds for capital works for which Government funds were not received.

Ranawaka’s shocking disclosure comes as CEB trade unions are once again demanding a substantial pay hike.
http://www.lbo.lk/fullstory.php?nid=445303843

UKboy wrote:

K.Haputantri wrote:I think the Govt. should seriously consider the privatization of the CEB if they really want to give power to people at a reasonable cost. Then only the Govt. can stop large scale waste & curruption and controle CEB engineering mafia.

Look at the privatization of bus transport. Private bus operators run their business with profit without any grant from the Govt., while SLCTB is unable to earn even an opertional profit with all Govt grants and subsidies not available to the private busses.

Food for thought, Hon. Minister Champika!

Agree with you. But you know our majority of Sri Lankan people dont like the word privatisation.

institutes like CPC, CEB, CTB, Air lanka should be privatised & the selling stake should be less than 49%.

That is the most important thing....never give the ownership....take their management skills....

If there is no SLCTB we can see how private bus mafia will work.....Never give monopoly to private sector as main policy of private sector is more and more profit.

See the article below. Even with massive tariff changes this year, see what the Minister is saying on the state of CEB

SLS




August 12, 2012 (LBO) – Sri Lanka’s power minister has sought cabinet approval to raise state-run Ceylon Electricity Board’s borrowing limit to 74.2 billion rupees to meet increasing fuel needs, settle debts and pay independent power producers, a report said.

Minister Champika Ranawaka told his cabinet colleagues that the state power utility owed 16 billion rupees to independent power producers and another 15 billion rupees to state-run Ceylon Petroleum Corporation, the Colombo-based Sunday Times newspaper said.

The higher borrowing limit will be used to meet:
- Overdraft and term loans – 45 billion rupees
- Provision for letters of credit -- 10 million rupees
- New guarantees for independent power producers -- 19.2 million rupees

The minister blamed the heavy costs on the prevailing drought that has limited hydro power generation. The CEB is now depending on expensive thermal power to provide uninterrupted electricity supply to the country.

“As payables to independent power producers have reached peak level, purchasing of fuel from CPC for thermal generation has been limited. IPPs have utilised their credit limit to maximum level,” Ranawaka was quoted in the report.

The CEB has secured a 20 billion rupee short-term loan facility from state-run People’s Bank PLC during past few months, to settle these liabilities to CPC, the independent power producers and to import coal.

The short-term loan was used to settle:
- Overdraft of 800 million rupees
- Term Loans of 5.410 billion rupees
- Short Term Loan Facility (Bill Discounting) of 20.454 billion rupees

Ranawaka said a 10 billion rupee Letter of Credit/Guarantee has been fully utilised. Only a standby letter of credit facility of 18 billion rupees has not been utilised.

As a temporary measure, the CEB had approached People’s Bank for a term loan facility, to partly settle the CPC and the independent power producers.

However, People’s Bank had rejected the request since it goes above the single borrower limit enforced by the Central Bank of Sri Lanka.

“Hence Minister Ranawaka wants his ministerial colleagues to approve his request to ask the Governor of the Central Bank to increase the single borrower limit to the CEB to 74.2 billion rupees,” the report said.

Ranawaka said the CEB was in “severe financial crisis” despite imposing a fuel surcharge between 15 percent to 40 percent in February to trim losses.

The minister said there were broadly four reasons for the financial crunch:
1. Increase of cost of independent power producers and CEB fuel due to increase of fuel prices by CPC and increase of thermal generation due to prevailing drought situation in the country.
2. Additional revenue on Fuel Adjustment Charge is not sufficient to cover the increased fuel cost.
3. Non-receipt of subsidy from the Government for 2011.
4. Use of CEB funds for capital works for which Government funds were not received.

Ranawaka’s shocking disclosure comes as CEB trade unions are once again demanding a substantial pay hike.

http://www.lbo.lk/fullstory.php?nid=445303843

The Minister's crusade to thwart rampant corruption in the CEB and check wastage have met with resistance from the all powerfull CEB engineer's union. Now he want even talk about it.

It will be a futile exercise putting huge sums of public money into this abyss. If a bank is preasurised to grant loans to the CEB, system collapse is inevitable or else the Govt. will be compelled to rescue them.

If CEB engineers sitting on high posts in the CEB cannot come out of this mess & turn-around they should resign forthwith. ?What right these engineers have to occupy high seats of management & distroy a public institution so important to the economy.

It is high time that the restructuring plan is expedited before committing billions of public funds to this mess. If this Govt. cannot do this with all its strength, no other Govt. will be able to do it. Don't miss this opportunity Hon. Champika.

K.Haputantri wrote:The Minister's crusade to thwart rampant corruption in the CEB and check wastage have met with resistance from the all powerfull CEB engineer's union. Now mhe want even talk about it.

It will be a futile exercise putting huge sums of public money into this abyss. If a bank is preasurised to grant loans to the CEB, system collapse is inevitable or else the Govt. will be compelled to rescue them.

If CEB engineers sitting on high posts in the CEB cannot come out of this mess & turn-around they should resign forthwith. ?What right these engineers have to occupy high seats of management & distroy a public institution so important to the economy.

It is high time that the restructuring plan is expedited before committing billions of public funds to this mess. If this Govt. cannot do this with all its strength, no other Govt. will be able to do it. Don't miss this opportunity Hon. Champika.

Agreed. Time all the responsible people pull of their socks up to put country before self and come up with a solid plan to rescue CEB to escape curses of so many who love the country still. The average persons specially do not have to pay for the follies of the management their entrusted to do their job. If they can't time to go home.

http://forum.srilankaequity.com/t21316-sri-lankas-debt-ridden-power-utility-seeks-more-loans

Redbulls wrote:http://forum.srilankaequity.com/t21316-sri-lankas-debt-ridden-power-utility-seeks-more-loans

Thanks for your concern but this one need not be merged as they are in different sections and discussion has started .

Topics Merged.

@Hapu: Did you read the article fully? Look at the reasons (for the crisis) the minister has outlined. Do you think CEB engineers are the ones responsible for the drought???

IMO there has always been a serious problem in SL power generation sector (a shortage), we are too dependent on hydro power. I actually thought the Coal power plantation might help resolve this issue up to some degree, but that plantation is not working. What we may want to do is punish those idiots (engineers and authorities alike) who have completely failed the project.... what a waste of money.

I wonder what other power sources we can turn to:

- Solar power: Government can provide a subsidy for installing solar panels and related equipment in households and thereby limit national grid access. This is done in UK where it rains / is cloudy the whole damn year (but they are a rich country). But we have a lot of sunlight.... may be the government should seriously look into this as a long term plan.

- Nuclear power: OK, we can't produce it, but is it not possible to buy power from India? (they have a couple of Nuclear plants right?)

- Anything else?

Cheers!

anubis wrote:@Hapu: Did you read the article fully? Look at the reasons (for the crisis) the minister has outlined. Do you think CEB engineers are the ones responsible for the drought???

IMO there has always been a serious problem in SL power generation sector (a shortage), we are too dependent on hydro power. I actually thought the Coal power plantation might help resolve this issue up to some degree, but that plantation is not working. What we may want to do is punish those idiots (engineers and authorities alike) who have completely failed the project.... what a waste of money.

I wonder what other power sources we can turn to:

- Solar power: Government can provide a subsidy for installing solar panels and related equipment in households and thereby limit national grid access. This is done in UK where it rains / is cloudy the whole damn year (but they are a rich country). But we have a lot of sunlight.... may be the government should seriously look into this as a long term plan.

- Nuclear power: OK, we can't produce it, but is it not possible to buy power from India? (they have a couple of Nuclear plants right?)

- Anything else?

Cheers!

Have not done a feasibilty study but
importing nuclear power
solar power ( this is a good option to promote in a country like SL)
Wind power
tidal power

are some other things to note

Yup, wind power is also another good option for a country like SL. But as you said, not sure of it's feasibility / scalability.

Cheers!

anubis wrote:
- Solar power: Government can provide a subsidy for installing solar panels and related equipment in households and thereby limit national grid access. This is done in UK where it rains / is cloudy the whole damn year (but they are a rich country). But we have a lot of sunlight.... may be the government should seriously look into this as a long term plan.
Cheers!

Solar power is a good option. I am not sure how much it would cost initially for the installation. It would be costly, which cannot be afford to install in every households. If I am not mistaken, there is an option to sell to the national grid when you produce more electricity than your need.
http://www.solartherm.lk/#!/page_pv2

@Monster: Indeed, I heard that more than the panel itself, the battery to store electricity (excess produced during daytime is backed into the battery to be used at night) is more expensive. In UK (as I heard from a friend), they only install the panel initially and feed the excess back into the national grid (since there is no battery) and households get paid for that!!!

Cheers!

Anubis, yes one of the reasons for the present crisis is drought. Hence, they should address that issue with available facilities. Almost all reservours are heavily silted due to bad agricultural practices in the catchment area. Their water retaining capacity has been reduced over the years and during the rainy season water is sent down the river due to reduced capacity of the reservours. The remedy would be to increase the water storage capacity with constant maitenance of the reservours. I dont think any of these reservours have been de-silted after their construction. This is a simple solution to store water wasted during the rainy season.

Likewise, there are hosts of other remedies outside the areas of an electrical engineer that could improve the power generation. The issue here is they are unable to think out of the box as such remedies were not taught to them in the university.

Apart from that very few undertake research in this very important area. As you are aware new knowledge & new inventions are required to improve the efficient usage of this scarce resource but none is interested on that aspect.

Grid connected home solar power units are operating successfully in USA. Though they introduced this in SL too they are not prepared to pay if usage is lesser than the amount added to the grid. The excess generated has to be given to them free. ?What a foolish decision - they really want to discourage people to invest. As a result there is no incentive for a household to invest due to this adamant stance of the CEB management.

They have developped a liking for foreign funded projects where perks are available and tenders can be flouted.

In addition, they grab administrative duties where decision making on planning admin & monitory matters are involved thus making the entire institution an inefficient loss making white elephant.

Moreover, they have been the stumbling block that slow down the new minor hydraw power generating projects over the years. Many projects mooted by private parties have not been granted approval citing various issues.

They resisted restructuring plan by the Government as they know that they cannot play this game after the restructure. These are just a few that comes to my mind.

@Hapu: You have highlighted some good points. It's not impossible that some of the responsible engineers have lost their ethics. However, I think it's a mix of bad governance and loss of engineering ethics. Overtime the system may have clogged down... as aj pointed out sometime back (but his views were too extremist).

Cheers!

Better to create a method to use sea water to produce electricity as sea ?never gets affected by drought or silting or polution but there are obstacles to overcome.

Whitebull wrote:Better to create a method to use sea water to produce electricity as sea ?never gets affected by drought or silting or polution but there are obstacles to overcome.

Yes that is a viable idea.
See the below link
http://www.ee.cityu.edu.hk/~rtbrad/wave%20gen.pdf

I believe we all ae saying the same . I also did mention Tidal Power above.

Redbulls wrote:

Whitebull wrote:Better to create a method to use sea water to produce electricity as sea ?never gets affected by drought or silting or polution but there are obstacles to overcome.

Yes that is a viable idea.
See the below link
http://www.ee.cityu.edu.hk/~rtbrad/wave%20gen.pdf

Redbulls wrote:

Whitebull wrote:Better to create a method to use sea water to produce electricity as sea ?never gets affected by drought or silting or polution but there are obstacles to overcome.

Yes that is a viable idea.
See the below link

Seems to be worthwhile to read.Thanks for sharing.