Electricity Tariffs should be reduced by at least 27%: PUCSL Chairman

By Chaturanga Pradeep Samarawickrama  

There is a possibility of reducing electricity tariffs by  27 per cent but the Ceylon Electricity Board (CEB) has submitted a  proposal to reduce the tariffs by only 3 per cent, concealing the correct  cost data, Public Utilities Commission of Sri Lanka, (PUCSL) Chairman  Janaka Ratnayake said.  

Addressing a media briefing yesterday, he said that CEB had  informed to submit the corrected data to reduce the electricity tariffs  on par with the actual cost reduction.  

“Compared to the decrease in electricity demand, the cost  of providing electricity should also decrease. The CEB initially  estimated an expenditure of Rs.392 billion for the period from July to  December 2023. But the CEB now says that Rs. 285 billion will be spent  for the next six months. According to our calculation, the actual cost of  electricity supply will be reduced by Rs.107 billion. If that is the  case, the electricity tariff should be reduced by at least 27 per cent as  a whole for the upcoming period. Otherwise, by reducing tariffs by 3 per cent only for a limited number of customer groups based on fake data,  will not do the justice for all electricity consumers. Also, the CEB  would not get the expected income,” he said.  

“The electricity tariff was increased by 66 per cent February this year based on fake data. At that time, the tariff should have been  increased by only 35 per cent. In the last tariff revision, we pointed  out that the electricity demand of 16,550 gigawatts estimated by the CEB  was incorrect. Our estimate was that electricity demand this year would  be limited to 15,050 gigawatt hours. In April, CEB realized that our  estimate was correct and that their demand was overestimated.  Accordingly, they informed in writing that the estimated demand for the  coming period of the year is 15,264-gigawatt hours,” Mr Janaka  Ratnayake, Chairman of Public Utilities Commission of Sri Lanka said.  

Ratnayake pointed out that if electricity tariffs were set  and implemented according to his estimates, the situation electricity  consumers are facing today would not have arisen.   In a revision of electricity tariffs, all the proposals  should be submitted in accordance to tariff methodology (equation)  approved under the Sri Lanka Electricity Act. According to this methodology,  only the reasonable cost of supplying electricity can be charged from  the electricity consumer. Mr Ratnayake pointed out that contrary to the  approved method, CEB is trying to implement the tariff revision proposal  even this time, by including proposals to recover the loans received by  CEB from the electricity consumers.  

“According to the tariff methodology, all data should be  submitted correctly. Only approved costs recoverable from the customer  can be included in the total cost. But this proposal has not been  submitted with the data approved under tariff methodology, he said.