Power sector to receive fresh support with ADB’s US $ 100mn policy-based loan

Sri Lanka’s power sector will receive fresh support from the Asian Development Bank (ADB), to facilitate reforms, as it approved this week a US $ 100 million policy-based loan.
The Power Sector Reforms and Financial Sustainability Programme will complement the International Monetary Fund’s Extended Fund Facility arrangement and bolster the operational efficiency and competitiveness of the country’s power sector. 
The programme will help create a conducive environment for private investments, boosting renewable energy development and modernising power grids.
“Developing cost-competitive renewable energy and providing reliable and affordable electricity supply—with a transparent and independent power sector regulatory framework—will help Sri Lanka drive economic growth and address the current financial and economic crisis,” said ADB Principal Energy Specialist Jaimes Kolantharaj. 
Accordingly, the programme will support the reforms in the power sector, introduced under the Electricity Act, including institutional and regulatory reforms and improve operational sustainability of the electricity sector. It will also support the development of renewable energy to accelerate the country’s transition to clean energy as envisaged under Sri Lanka’s nationally determined contributions.”
The ADB support will enable the government to undertake institutional reforms in the electricity sector by establishing independent companies, with defined functions and support, strengthening their corporate governance and financial sustainability. It will support regulatory reforms with the implementation of the new national tariff policy that will improve financial sustainability of the sector through cost-reflective tariffs.
To help accelerate investments in renewable energy, the programme will assist multiple initiatives under the renewable energy expansion plans for 
2023-2030.