The Ministry of Power and Energy has sought cabinet approval to increase tariffs on electricity yet again. If approval is granted, consumers will see their electricity bills go up by twenty percent. On an average a consumer paying a monthly bill of Rs. 1000 would have to pay Rs. 200 more, if approval is granted.
Ceylon Electricity Board General Manager Ranjith Fonseka said the CEB had proposed various adjustments to the tariff structures to recover the cost arising from excessive thermal electricity generation. One such suggestion was the removal of the subsidy given to domestic consumers.
This move comes in the wake of the Ministry of Power and Energy seeking a Treasury advance of five billion rupees to run the cash-strapped institution. The CEB at present has financial burdens of more than 80 billion rupees, of which it has on the short term, unsettled bills amounting to more than six billion rupees. The CEB`s creditors include the Ceylon Petroleum Corporation and the independent power producers.
A ministry official said if the Treasury bailout did not come on time, they would not be able to pay the private power suppliers. This might result in the power suppliers stopping supply to the national grid and lead to power cuts.
In addition to the five billion rupee advance, the ministry has also asked the Treasury for a restructuring plan for their financial burden of eighty billion. If this happens the Treasury would take over the eighty billion financial burden and the CEB would have to pay the Treasury back in installments. The Power and Energy Ministry is yet to receive a response from the Treasury on this matter.
Ministry sources said that at present the CEB was losing between 35 and 40 million rupees a day largely as a result of supplying electricity at subsidised rates.