ECONOMYNEXT – Sri Lanka’s Public Utilities Commission has failed to hike tariffs for nine years leading to financial crisis and a steep hike in 2022, raising questions about the role of a regulator, Power and Energy Minister Kanchana Wijesekera said.
“The electricity price was revised after 2013,” Wijesekera told parliament. “It is after nine years that the prices were revised. In 2013 electricity bills were raised in 2014 the bill was cut by 25 percent.
“When Mahinda Rajapaksa was President, when the Norochcholai coal plants was connected, because costs were reduced, the price was cut.
In the ensuing years the required policy decisions were not taken and those that were taken was not carried out, by successive administrations, he said.
“There is a regulatory agency here – the Public Utilities Commission,” Wijesekera said. “The minister cannot reduce or raise the electricity price when he wants. The government also cannot raise it.
“The main regulator of the power sector is the PUCSL. When the PUCSL has done its job is question in the minds of the people.
“Most of the time we say that it is good to have independent commissions. But in this case I think it would have been better not to have it.”
The PUCSL’s objective has not been met, but he does not point fingers at all officers in the agency he said.
After 9 year the recent price rise in August was also not enough to make the sector viable, he said.
From 2013 to 2022 the central bank had printed money to mis-target rates and depreciated the rupee from 131 to 360 to the US dollar.
A hurried fuel surcharge was put under the IMF program to avert a currency crisis in 2012 as part of a float that led to a collapse of the rupee from 113 to 131 to the US dollar.
In Pakistan, which has the second worst central bank in the region after Sri Lanka, the power sector has also been in crisis for many years, with never ending price hikes, losses, arrears to independent power producers and load shedding (Pakistan Electricity outages, power shortfall increased).
In 2022 there were up to 8 hours power cuts in some areas of Pakistan. Committees are also formed to inquire into sudden blackouts of the rickety grid. (Colombo/Nov25/2022)
The Sri Lankan Government including its various ministers need to accept responsibility for the way they managed their financial budgets.The former regime came into power seemingly promising concessions by assuring the voters that by voting for them they would be recognized, honoured and trusted by running the country. It’s time this present government got its ACT together by being honest with themselves and the public. The present government must recognize the difficulties ordinary person has with feeding their families and being able to pay off their debts.