The three rupee hike per litre of diesel, which came into effect on April 19, has put the Ceylon Electricity Board into dire straits.
The CEB was purchasing a litre of diesel at a subsidized price of Rs 55. However, the CPC now insists that the CEB should buy at the increased new price of Rs 63, an increase of Rs 8 per litre, CEB sources said.
Under the Rs 55 price structure, the CEB was still incurring a loss of Rs 2 per unit of electricity supplied. The CEB spent Rs 12.80 to generate one unit of electricity and was selling it at Rs 10.80. This resulted in the CEB incurring a loss of Rs 57 million a day.
The eight rupee increase has pushed the CEB into a deep crisis and its top management is now working volume of loss the heavily indebted institution would incur.
CEB General Manager R Pulleperuma has appointed a committee to study the matter and recommend any price revision to the Treasury and the Cabinet.
The electricity consumption in the country is around 28.5 million units per day and on weekends its between 22 and 25 million units
Before the price hike on diesel the CPC Chairman Asantha de Mel told a press conference on April 18 that the Government had done away with the subsidy granted to the Corporation from April last year. He said the CPC was incurring a loss of Rs 60 million a day.