Amidst wide-ranging consultations to revise electricity prices by the Public Utilities Commission of Sri Lanka (PUCSL), the next most challenging task of the regulator appears to be fixing prices from petroleum profits, probably from the third quarter of this year, Mirror Business learns.

A top Commission official who did not want to be quoted said, once the law is passed in Parliament, it is most likely to be enacted by the third quarter of this year, empowering the Commission to regulate pricing, licensees, transportation and storage of petroleum products.

“Anticipating the legislations will be passed by the Parliament at least by 3Q’13, we are now in the process of developing templates for granting licenses for the existing operators, because once legislations are enacted, even the Ceylon Petroleum Corporation (CPC) becomes an illegal entity,” he said on the grounds of anonymity.

The development will most likely to be welcomed by a vast majority of stakeholders, particularly the consumer due to increased transparency, as PUCSL will develop a methodology for price regulated petroleum products in consultation with relevant industry stakeholders.

At present the pricing of the petro products are determined by the CPC and Lanka Indian Oil Company PLC with neither regulatory oversight nor public consultation.

According to the Commission, once the pricing methodology is established they will be in a position to ensure that price regulated petro products are priced by market participants. It is believed that such a mechanism will protect consumer interest and also ensure financial viability to the operations of licensees, exempted and authorized persons.

Besides, the Commission will develop templates for granting of licenses, exemptions and authorizations with respect to the importation, supply distribution and sale of petro products.

The Commission said that once the templates had been developed and issued, it would be in a position to regulate the operations of licensees, exempted and authorized parties in the industry.

The latest developments taking place in the country’s energy sector are well received by the analysts contacted by Mirror Business and commended the authorities for embarking on a constructive dialogue which is paramount in the post war era, particularly to ensure sustainability in the sector without straining the country’s budget and creating imbalances in the banking sector.

The petroleum products (Special Provisions) Amendment Act and the Ceylon Petroleum Corporation (Amendment) Act drafted i n consultation with the Legal Draftsman’ Department and the Attorney General’s Department are expected to be presented to the Parliament this year.