A few weeks ago, the Ceylon Electricity Board (CEB) posted a ‘wanted’ advertisement for a Financial Consultant ‘to provide guidance on investment decisions, cash management and dy-to-day organisational expenses. The expanded responsibilities include, ‘forecasting costs and revenues, conducting risk analysis for financial plans, evaluating capital expansion options and to provide guidance and recommendations to the Chairman and the Board on all finance related matters.'
On the face of it, this is a good move. In fact all state owned enterprises, statutory bodies, state institutions including ministries ought to be regularly monitored and evaluated, inefficiency and incompetence determined and action taken against those responsible if that be the case. The flip side — and we say this taking into consideration the history of such exercises — is to place an agent or set of agents in such positions with an informal but specific brief: deliver ‘findings’ that can justify policy directions already envisaged.
In any event, Minister Kanchana Wijesekera has been saying a lot about cost-reflective pricing, amending legislation and restructuring. All good, except that there’s more than one way to skin the cost reflecting pricing cat and he’s opted to kick the poor and cushion the rich, ensuring that Sri Lanka adds to dollar-expenses for oil and coal to keep the latter satisfied. Except that he seems to believe that restructuring is about kicking non-engineering unions in the teeth and turning a blind eye to inefficiencies, over-staffing and the shady schemes related to the engineers. Except that we are yet to hear him talk specifics in relation to legislative enactment in relation to doing away with archaic clauses which in the name of energy security ensure continued dependence on dollar draining imports.
Sri Lanka, not too long ago, was ahead of India in terms of national coverage. India at the time was heavily dependent on coal and thermal energy. Power cuts were normal. In 2015 Prime Minister Modi essentially told the Indian counterparts of CEB officials that India will go for solar power. They were required to fall in line or else.
Today most of India’s state grids are completely self-sufficient and that country is even exporting electricity to Bangladesh. Modi’s drive in fact had a significantly positive impact on the global solar scenario. India believes that a KWH of electricity could be generated at a cost of just 4 US cents!
What’s Sri Lanka’s story? Given the relative total generating potential, scale, population and demand, Sri Lanka could have produced a surplus. Had the CEB got its act together (a tough ask given entrenched personal interests of high-ranking officials and the complicity of politicians), looked at global trends and technological development, Sri Lanka wouldn’t have ended up in this pathetic dollar-deficient, import-dependent situation.
Numbers. Sri Lanka needs 4,000-4,500 MW of installed capacity to meet currebt peak demand. Now Bangladesh’s current requirement is 20,000 MW, projected to at least double by 2050. They don’t have major renewable resources and will have to look to fossil fuel thermal and nuclear energy well into the future. The CEB? To put it bluntly, it’s a matter of monkey-sees, monkey does. No working or innovative expertise, no vision, no compulsion; not since Wimalasurendra.
The CEB, Wijesekera must know, cannot be ignorant of the fact that Sri Lanka has tremendous renewable generation potential well in access of even projected increase in local demand. Today countries such as Indonesia, Singapore and Malaysia are talking of importing solar based electrical energy from Australia via an undersea cable almost 4,200 km in length called the 'Sun Cable.' Sri Lanka is just 1,800 km away from Bangladesh, a fact that can only become significant if Sri Lanka aggressively pursued the eminently logical option of developing the renewable sector inclusive for export purposes.
It seems logical because even today, the general rule of thumb for the CEB to meet peak demand is to depend on thermal energy. ‘Emergency power,’ when required all the time, year on year for over a decade, makes the adjective meaningless. The CEB has no plan to reduce reliance on emergency power which translates in practical terms to that which a preferred supplier can deliver upon a quick call. Greasing of palms then? Kanchana’s Financial Consultant (FC), if appointed and if possessing any integrity, may find out.
The CEB, it is well known, fought hard to scuttle plans for enhancing the contribution of renewables which, theoretically could satisfy the entire demand for electricity and even double it for export. The CEB grudgingly agreed to a plan to bump the slice to 70% but this hasn’t moved from policy to implementation. Another question that the FC could address. Interestingly, no other country in the world has quibbled over numbers related to targets.
Engineers simply say ‘more expensive, it’s not worth it.’ And they point to archaic related to unwarranted concern about energy security which, interestingly, goes against the economic thinking of this government, namely the limitation on maximum installed capacity by a private sector power producer, 50MW. So, ‘Mega Solar’ is out of the question.
The CEB sites ‘inertia,’ as an inhibiting factor. In other words, thermal energy is generated more or less at a constant, whereas solar is dependent on factors that cannot be controlled, bad weather days, cloud cover etc. Inconsistency plugged into the grid is harder to balance and could trigger it to trip, this is correct. However the concern of instability is easily addressed and indeed has been addressed in countries with worse an ‘inhibiting factor’ not just those that are developed, but by countries in Latin America as well. Maybe the CEB is ignorant, lack sector working expertise or, worryingly, know very well that such transformation could trip cutbacks.
Perhaps this is why the CEB seems to be so averse to digitising the grid. The know-how and technology exists, however, to put in place a highly digitised oversight and dispatch control system based on predictive artificial intelligence on both the generation and demand side, capable of even a 15 minute dispatch interval. Instead, someone has to make a manual intervention to a power generator, is able to fiddle with choice of who and numbers, scaremonger governments to submission and make a sweet deal with a supplier cutting into Sri Lanka’s exchange reserves. Digitisation would make things algorithm driven. transparent. Accountable. Good for all except whoever is making bucks by blocking the move towards renewables. Maybe Kanchana could hire an FC who is well versed in technologies used in other countries. Indeed there are probably many Sri Lankan expatriates who would fit the bill. Would the CEB embrace such an option and if not, why not? Would Kanchana ask his buddies in the World Bank and IMF to facilitate digitisation? Would they say ‘no’? Unlikely.
The CEB has also talked of the problem posed by grid infrastructure or lack thereof, e.g. ‘we need to build more high tension transmission lines.’ This is a barefaced lie. To put it crudely, no transformer on the planet will argue about the source of generation. Doesn’t know, doesn’t care. As long as you feed the electricity to the specification the transformer is built to receive.
For example, if floating solar panels were installed in all the reservoirs currently producing hydropower, ensuring that less than 15% of the relevant surfaces are used in order not to infringe upon environmental concerns, the very same transformers could be used. The same high tension grid as it is for hydro. The hydropower could be used as back up or to address inertia issues, again based on a system of AI-based generation governance and balance that is transparent and accountable and greasing-free.
The truth is that we would not be needing any backup or ‘emergency power generation’ if we utilised the existing hydro-generation reservoirs, Negombo, Kalpitiya, Batticaloa, Trincomalee and Jaffna lagoons, all locations there are currently touched by transmission lines. No additional infrastructure expenditure, but enabling massive solar generation even at using just 15% of the surface so that there are no environmental concerns.
And that’s just solar. There’ also wind. The CEB, it must be mentioned, has never spent mega bucks on developing the sector to any degree of success. Failure perhaps, success no. The Treasury provides the money, the CEB operates and maintains, spending only for these functions.
Back to numbers. The current peak demand is projected to double by 2030, requiring an additional 15,000 GWhrs annually (4,000-4,500 MW installed capacity) to be provided to the grid. As is, the lagoons and the Mahaweli reservoirs could generate 8,000 MW, meaning that at any given time there’s at least 4,000-4,500 MWs for export, provided of course that there is investment for installation of under sea cables. Do not restrict ones self to existing transformer capacity/ grid connectivity network and more can be exported.
Currently peak demand is 4000-4500 MW or around 15,000 GWhrs a year. By 2030, demand is projected to rise 30,000 GWhrs and therefore an additional 15,000 needs to be provided to the grid. The lagoons and the Mahaweli System at minimum can generate 8,000 MW (as is). At any given time we can export 4000-4500 MW for export. MINIMUM. If we exploit the full solar potential only on floating solar capacities, we can be a dominant net energy exporter in the region. CEB will never be a bankrupt institution, never be a dollar-demanding institute but actually a dollar-earning institute.
Yes, there are costs. Floating solar panels don’t fall from the sky or drip along with sunbeams. If, say, the installation cost is 1.5 million USD per MW, the total cost would be in the region of 6 billion USD. Obviously, it should be opened to private investors. If Kanchana and this government is truly ok with that kind of economic policies, then, why not? We would not be needing a single dollar on imports to produce coal or thermal power. Bad idea? What would the FC say? It can't be done by limiting maximum generation to 10MW by the private sector. Mega solar is the answer.
As of now, neither Kanchana nor anyone in the CEB seem interested. If no one is, it means that rank idiocy and corruption could be the main reasons. Or rank incompetence. The FC could tell us, of course. And maybe we will have meaningful change which of course requires the necessary restructuring of thinking-ways, frames of reference and of course overall, long-term objectives of energy security and insulation against dollar-dependency.
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