Budget 2022 energy and renewable energy

In the Budget speech for 2022, the Minister for Finance has said ‘Leveraging on the strategic positioning Sri Lanka also has potential to become Asia’s energy hub, through import of Crude Oil and export petroleum products. The unutilised Trincomalee Tank Farm with a storage capacity of 8 million barrels of oil is extremely crucial in this context. Two more Refineries focused on exports are planned to be established in Hambantota and Trincomalee. At the same time, potential to generate electricity from renewable sources, such as wind, ocean waves and solar, exceeds Sri Lanka’s energy requirement. As such, Sri Lanka has the opportunity to produce and export Green hydrogen from surplus renewable energy’. A lofty thought, indeed, when compared to the present situation where the oil refinery at Sapugaskanda is to be closed down for 50 days for want of crude oil, due to foreign exchange not being available. It is hoped the financial situation in Sri Lanka, during 2022, will improve to solve the problem, which is very unlikely due to heavy repayment of loans taken on unproductive schemes undertaken by previous governments. However, hope for the best and prepare for the worst to stand in queues for kerosene, petrol and diesel.

The Budget proposal for tapping Ocean Wave [OTEC] energy reminds me that in 1987, a foreign firm with the backing of politicians wanted to set up an OTEC plant in Sri Lanka in partnership with the Ceylon Electricity Board [CEB], On inquiries made, it was found that an OTEC plant, off Hawaii Islands, had been abandoned. Seeing the political backing and not to commit the CEB on this project, the then Secretary to the Ministry for Power and Energy, Prof. K. K. Y. W. Perera, in his wisdom, recommended that the foreign company set up such a plant at its own expense and the CEB would purchase electricity at a negotiated price. This was not to the liking of the foreign company and they took the next available flight home. Speaking of Ocean Wave Energy, in my eagerness I contacted several companies and I received a letter, about two /three years back, from one company which said- ‘Regarding current status of OTEC there has still not been a commercial OTEC plant built.

Our 105 Kw system in Hawaii is still considered the largest grid connected OTEC plant. The only two operational plants are our system in Hawaii and another in Japan. Both these systems are at a small, non-commercial scale approximately 100 Kw output. The huge capital cost of OTEC and the low cost of oil and other renewable energies such as solar and wind has kept people from investing in OTEC. That being said the technology has been proven and is technically feasible to build an OTEC plant but the economics do not work out for any system smaller than 10-100 Kw scale’ I am not aware of any advancement in the technology now and it is best the authorities get the information updated. Strangely, the monetary provision set apart for Renewable Source in the national Budget is a measly Rs.500 million perhaps expecting the private sector to come in a big way, granting them tax relief and also the CEB to provide funds under its own budget.

As one, when in service submitted information concerning the energy sector to be included in the Budget Speech [ once called Throne Speech] the organisations under the ministry – CEB, CPC and Gas Co – were consulted and proposals sent. I wonder whether this practice has been observed.

It is hoped the energy authorities are aware of severe dry years following heavy rainy years, as we experience now, and the cancellation of the additional Coal Plant at Norochcholai by the President and doing away with Coal Power Generation completely, in time to come, be in readiness to face a power crisis, worse than what we experienced in 2004 before dreaming of exporting electricity to India and later far off Singapore. Be mindful that electricity is a vital utility for socio-economic development of a country and mishandling this utility will bring disaster as the saying goes, “In the correct hands electricity can provide illumination but in wrong hands electricity can be highly destructive.”

G. A. D. Sirimal

BORALESGAMUWA,