Sri Lanka’s power sector is bracing for a steep electricity tariff hike, with senior officials confirming that a revised proposal seeks an additional 53% increase, just weeks after the last revision took effect on 01 April.

The move follows a deepening cost crisis, triggered by substandard coal imports and ongoing fossil fuel supply constraints, which, officials say, have already imposed a burden exceeding Rs. 20 billion for the April–June period.

“The numbers are alarming. This is not a marginal adjustment but a structural cost shock,” a senior energy sector official told The Island. “The tariff filing reflects a requirement of around Rs. 40 billion, and roughly half of that is directly linked to the coal issue.”

According to internal estimates, coal-based generation has dropped by nearly 250 gigawatt-hours (GWh) during the three-month period due to poor-quality fuel, forcing greater reliance on costly diesel generation.

“Replacing that lost capacity with diesel costs in the region of Rs. 25 billion,” another official said. “Even after accounting for about Rs. 4.5 billion in reduced generation costs, the net additional burden exceeds Rs. 20 billion.”

The National System Operator (NSO) has projected a total additional cost of approximately Rs. 42 billion for the quarter, forming the basis of the latest tariff application now under review.

Former Energy Minister Eng. Patali Champika Ranawaka also weighed in, warning against transferring the burden to consumers.

“To increase tariffs by Rs. 41 billion under these circumstances is deeply concerning. Around Rs. 20 billion of that is due to the coal issue,” Ranawaka said.

He urged the Public Utilities Commission of Sri Lanka not to approve measures that would pass inefficiencies and losses directly onto the public.

Ranawaka called on the government to take firm action against those responsible instead of deflecting accountability. “The focus must be on accountability and recovery, not on shifting blame or burdening the people,” he said, in an apparent reference to past attempts to attribute power sector failures to external or trivial causes.

Officials acknowledged that the proposed increase, if approved, would place additional strain on households and businesses already grappling with high living costs.

“What is particularly concerning is the contradiction between assurances and actual filings,” a senior official noted, referring to earlier claims that losses from the coal issue would not be passed on to consumers. “The tariff submission clearly suggests otherwise.”

The crisis is expected to intensify in the coming months. Diesel prices are likely to rise, further escalating generation costs, while high-priced heavy fuel oil (HFO) shipments expected from April will add to overall expenditure.

“These pressures are cumulative,” an official said. “The system has very limited capacity to absorb them without tariff adjustments.”

Questions have also been raised about the feasibility of recovering losses from the coal supplier. Officials pointed out that the estimated financial damage is nearly equivalent to the total invoiced value of the first 11 coal shipments—around Rs. 21 billion—making full recovery unlikely.

Energy analysts warn that the financial impact could extend beyond June, as the affected coal stocks are expected to remain in use until at least August, prolonging inefficiencies and elevated costs.

The unfolding situation has intensified calls for transparency and accountability in the energy sector, with growing concern that consumers may ultimately bear the cost of systemic failures.

“This is about the credibility of the system,” a senior official said. “Without accountability, these crises will continue—and the public will keep paying the price.”

By Ifham Nizam