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CEB Highlights Serious Errors in PUCSL Report on Cost Estimate for Delays of Power Projects

The Public Utilities Commission of Sri Lanka (PUCSL) has recently released a report titled “Financial Delay in Implementation of Power Plants” which estimates the financial losses due to power plant delays between 2018 to 2020 period at 50.6 billion. CEB had replied to PUCSL stating that the report has over estimated losses by 650% and “has serious calculating errors and major omissions and is prepared without an in-depth analysis”.
This is the second occasion in the recent past where PUCSL had published reports giving figures that carry serious errors as per later CEB findings. In this latest CEB reply, the General Manager CEB had stated that PUCSL’s calculation of the delay to proposed 300MW Kerawalapitiya LNG power plant is a 1300% overestimate. As per CEB calculations the estimated financial losses should be 2 billion and not 28 billion as per PUCSL report. CEB highlighted the major mistakes committed by PUCSL in its estimation, which includes considering the power plant to operate on Liquid Natural Gas (LNG) from 2019 whereas the plant is to be partially operated on Oil in 2019 due to lack of availability of LNG supply infrastructure by then. CEB reply further highlights other mistakes by the commission such as considering the cost of Rooftop Solar as Rs 11.86 per unit whereas the current price paid for a unit of Solar rooftop is Rs 23 per unit. As 60% of current solar additions are from rooftops, such omissions create serious overestimations.
CEB reply also extended CEB assistance to commission staff and states “We accept the need to have an independent, professional regulator and would fully extend our support for your staff to develop such knowledge and skills required. We do acknowledge that electrical power systems is a highly specialized subject area and long years of experience in the fields of power planning and system operations is required to properly understand the intricacies. We cordially invite your staff to develop a close communication with the ministry, CEB and other agencies and understand the practical realities of power plant implementation in the country beyond the ideal, theoretical, isolated world within which they seem to operate.”
The CEB reply concludes by stating “However, if your staff fail to do so, their conduct not only would make timely development of power plant even more difficult to CEB and to the ministry but also would lead to develop a general distrust of reports and figures published by the commission.”

CEB Reply

PUCSL Report