Sri Lanka to have LNG power plants, no unsolicited bids: CEB chief

ECONOMYNEXT – Sri Lanka’s state power utility will go for liquefied natural gas power plants in the future to improve its generation mix, now largely reliant on coal, but is prohibited from accepting unsolicited bids, a senior official said.

With LNG prices coming down, the Ceylon Electricity Board is considering building LNG power plants, but needs large units to justify the high cost of an unloading and re-gasification terminal, Anura Wijayapala, chairman of the Ceylon Electricity Board, said.

“Yes, we’re considering LNG,” he said in response to a question at a recent forum held by the Ceylon Chamber of Commerce in collaboration with the Public Utilities Commission of Sri Lanka.

“In 5-7 years, we will consider getting LNG into our system mostly because of operational issues – we can’t run with coal alone.”

The island’s grid now relies on a 900MW coal power station for its base load, the CEB’s first experience with coal power, which has contributed to grid instability along with renewable energy like wind and solar.

Wijepala was questioned about a proposal for a $1.2 billion 300MW LNG power plant at Hambantota port where the investor reportedly is offering to sell at 9 US cents per kilowatt hour.

“We got many unsolicited proposals but the electricity act prohibits us from accepting them,” Wijepala said. “Some proposals offer power even at 7 US cents.”

The CEB intends going for two 300MW gas power plants to be on competitive bidding, Wijepala said.

“Let this party participate. If they are so cheap, I’m sure they will get it.”
(Colombo/May 03 2016)

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