Chambers hail significant lowering of electricity tariffs by 25%

The Chambers hailed the significant lowering of electricity tariffs by over 25% and said that it will help to increase economic activity and also help create more employment and bring about several other economic benefits.

An official from Sri Lanka Tea Factory Owners Association said that one of their highest costs of the industry is for energy. “Due to the heavy machinery that needs high voltage the option of moving to solar energy is not practical. Hence the decision by the Government to reduce the electricity tariff will give us a good saving which we can reinvest for the industry. This will also give us a better advantage to lower some prices and once again compete with a better price tag in the export sector.”

Secretary National Chamber of Commerce Dr. Lakmal Fernando (Pictured) said that they have been making representation in the Public Utilities Commission (PUCSL) Public Hearings for many years.

“Even last time when the Public Hearing was held, we reasoned out for a 30% discount across board to the consumer tariff. However, our voices were not heard. As a result, CEB ended up making a massive profit at the expense of suffering of the general public and businesses.”

This year too, we made very strong representations and demanded a similar price discount. In my opinion getting a reasonable reduction for the industry sector tariff was the biggest milestone we achieved.

“Industry sector was proposed to give zero reduction originally by CEB. However the representations were so strong, we achieved a 25.3% reduction.” Currently the PUCSL is entrusted with determining the Solar Rooftop tariff. The President is also of the same view that Solar Rooftops tariff must continue until 2030 in order for the country to reach our international commitments and develop a strong energy security. There are attempts to hinder the RE sector in Sri Lanka by some officials.

“We strongly believe, the same way we won a cost reflective tariff for the consumer, the PUCSL and the Government will eventually decide what is right for the general public and decide on a financially acceptable rupee tariff for the rooftop sector as well.”

Electricity tariff reduction allows Sri Lankan material manufacturers to reduce prices, said President- Ceylon Institute of Builders (CIOB) Dr. Rohan Karunaratne. (Pictured)

“During the last few years, construction material cost has risen by about 300%. Now, with the recent announcement by the Public Utilities Commission of Sri Lanka who approved an electricity tariff reduction of 25.3% for industries and an overall reduction of 22.49%, the local manufacturers can pass this benefit to the industry.

“Locally manufactured materials being high have left many developers and big-time contractors to depend on important materials. Therefore, we believe that the ball is their court, for manufacturers who shall benefit from reducing their prices, increasing sales and widening their market reach.

Industries like steel, cement, tiles, bathroom fittings, paints, PVC, roofing etc. have the esteemed responsibility of reducing their prices, which can help bring semi-luxury construction cost to 15-16,000 sq.ft and luxury to 20,000 sq.ft. Thus, Sri Lanka can be on par with our neighboring countries and attract FDIs.

The Asian Development Bank (ADB) has recently approved a $100 million loan to support the power sector in Sri Lanka.This program shall aid power sector reforms under the Electricity Act. ADB will provide an additional $1 million technical assistance grant to support program implementation, capacity building of electricity companies, development of their business plans and overall development plans.

This gives further hope for manufacturers for price reduction, and subsequently the advancement of Sri Lankan Construction Industry as a whole.

An official from the condominium association said that due to high electricity prices people were reluctant to purchase new apartments. “Due to lower tariff we expect the sale to go up once again.”

Meanwhile the Tourist Hotels Association (THASL) President Shanthikumar said the traffic reduction is a welcome move that would help the sector to lower some of their overhead.

“What we now need is hassle free and uninterrupted policies in visa and also a better and more focused marketing campaign.”

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