President’s Energy Directive ignored by the Power Ministry – II

A reply to Dr Tilak Siyambalapitiya

Dr Janaka Ratnasiri

The piece written by Dr Tilak Siyambalapitiya (Dr TS) appearing in The Island of 24.02.2021, in response to my letter on 19.02.2021 is wide of the mark. The Power Ministry officials responsible for not taking any action on the President’s directive for over five months are fortunate that they are living in Sri Lanka where there is still some sort of democracy prevails. In a country like China or North Korea, they would have been probably summarily executed.

PRESIDENT’S DIRECTIVE ON ENHANCING RE SHARE

The President wanted his target of 70% of electricity generation from renewable energy (RE) sources achieved by 2030, that is in 10 years’ time. While this is not something impossible, it can be achieved provided the relevant authorities make a concerted effort beginning today (see writer’s pieces in the Island on 28^th and 29^th December 2020). In this exercise, it is not possible to make even a loss of 4-5% of time. That was why the President summoned a second meeting on 15.12.2020 when he found that no action was taken by the Ministries and their officials since his first meeting, he had with them 3 months before on 14.09.2020.

He categorically stressed at the second meeting that officials should be honest in their attitudes and expedite the exercise. Soon after, he appointed a former Army Official as the Vice Chairman of the Ceylon Electricity Board (CEB) to expedite CEB working on this matter. He even invited the Board of Investment Chairman to the second meeting and directed the CEB officials to work in collaboration with BOI to expedite granting approval for Foreign Direct Investment (FDI) proposals submitted by investors.

RELUCTANCE OF OFFICERS TO FOLLOW PRESIDENT’ VERBAL DIRECTIVES

Though the President has said at a number of meetings he had at village level and also in his Independence Day speech that the public officers should act within the authority vested on them, without referring them to higher authorities, and that they should treat his announcements as circulars, there have been instances recently when officers who were attempting to do so being pulled up by their seniors. The case of the Deputy Conservator of Forests in Gampaha District who stopped felling a rare species of a tree is one such instance.

Another is a report appearing in the Island of 26.02.2021 that “Senior officers of the Department of Wildlife Conservation and Forest Department yesterday expressed concern over a directive that they should seek the State Ministry Secretary’s approval prior to taking legal actions against those who harm protected areas”. Hence, the President’s word will alone not move officers into action because they could fall into trouble after the present regime changes.

NEED TO AMEND THE GUIDELINES FOR ELECTRICITY INDUSTRY

Therefore, the President’s verbal directive has to be translated into a written memorandum drafted by the Power Ministry Secretary and presented to the Cabinet under the signature of the Power Minister enabling amending the current Guidelines to Electricity Industry by raining its present RE share to be achieved by 2030 from 50% to 70%. The Public Utilities Commission (PUCSL) will then be able to direct the CEB to prepare its Long-Term Generation Expansion (LTGE) Plan accordingly. This is the first step to be taken in planning for achieving the President’s target.

The question I raised in my piece in the Island of 19^th was why hasn’t the Power Ministry done anything about it over the last 5 months. Was there any unseen hand holding back either the Secretary or the Minister from attending to this simple assignment? Was it the CEB management or its trade unions? Without addressing my question, Dr TS now talks about cost escalation if renewables are adopted in the future based on archaic PUCSL tariff. Isn’t this a “Yanne Koheda? Malle Pol” response?

NEW SOURCES OF FUNDNG FOR RENEWABLE PROJECTS

Everyone knows that electricity from clean RE sources, other than major hydro, costs more than from dirty fossil sources, despite the fact that RE projects do not burn any costly fuel and their average specific capital costs today are of the same order of magnitude as those of thermal power plants. This is because the average plant factor or the percentage time the plant operates during the day for RE plants such as solar and wind, is in the range 20-30% while for thermal power plants, it is in the range 70-90%. The low PF for RE plants is beyond our control as it depends on the geography and location of the country.

Solar power plants generate electricity only when sun shines on them and wind power plants generate electricity only when wind blows turning their turbines which could be internment both diurnally and seasonally. There is no such limitation in the case of thermal power plants. In working out the levelized cost of electricity (LCE), the power industry including experts like Dr. TS still uses the formula that LCE is the sum of the amortized capital cost, fuel cost and operation & maintenance (O&M) costs and divided by the total generation. So even if the fuel cost is zero with RE projects, the fact that their generation is low make them non-competitive compared to thermal power plants.

Now, if a third party meets the capital cost with no interest or any other pay back, the host country will have to meet only the O&M costs which will make RE projects financially viable. Dr TS regrettably appears to be not aware of this latest development in funding of renewable energy projects available today for developing countries, particularly after adoption of the Paris Agreement on Climate Change in 2015.

KYOTO PROTOCOL ON

CLIMATE CHANGE

The 15^th Conference of Parties (COP15) of the UN Convention on Climate Change (UNCCC), met in Copenhagen in November 2009 to decide on the future of the Kyoto Protocol on Climate Change (KPCC) adopted in 1997 which made it mandatory for the developed countries to mitigate their emissions of Green-house Gases (GHGs) by specified amounts ranging up to 5% relative to their 1990 emission levels, within the five-year period 2008-12. The developing countries on the other hand were exempted from such a requirement except that they are required to adopt social and economic policies leading to GHG mitigation.

Several Parties including USA, Japan, Canada and Russia later withdrew from the KPCC on the grounds that industrialized developing countries like China and India who emit the major share of GHGs are exempted from any commitments to mitigate. However, at every COP meeting, both China and India vehemently objected to any attempt to draw them into KPCC commitments, saying that on per capita basis, both China and India rank at the bottom. At one COP meeting, the Indian delegate said their emissions are emissions of survival rather than emissions of affluence as in developed countries.

At the COP15, there were several resolutions submitted by various Parties proposing the extents by which developed country Parties should be made to mitigate their emissions and the time frames. As is done in similar instances, the Chair appointed a small group comprising Brazil, Russia, India, China and South Africa (BRICS) to study the proposals and make recommendations to the Plenary for adoption by it, after debate. After lengthy negotiations, the Group came to an agreement that EU Parties will enhance their commitments, but all developing countries will remain uncommitted.

PARIS AGREEMENT ON CLIMATE CHANGE

When the meeting which was held behind closed doors was about to close towards mid-night of the last day of COP15, an unprecedented event took place. America’s President Barack Obama barged into the room unannounced (which only President Obama could have done), where he did not even have a chair to sit. He intervened to say that he was willing to mobilize USD 100 billion annually up to 2020 from developed countries, both public and private sector, for assisting developing countries to undertake RE projects, provided they agree to make voluntary commitments both in amounts and time frames.

He further told others that even the developed countries need not undertake mandatory commitments but only undertake voluntary commitments. Both China and India who were members of the BRICS Committee fell for this carrot, who were hitherto vehemently protesting making any mitigation commitments, gave their consent to Obama’s offer. That event gave birth to the Paris Agreement on Climate Change (PACC). However, it took 6 more years for the text of the Paris Agreement to get adopted by Nations at COP21 held in Paris. The motive for President Obama making his proposal came out during his speech he made at the Plenary of COP21 when he said that America would undertake emission reductions the way they wanted to and not the way others wanted to.

GREEN CLIMATE FUND

During the COP21 itself, many heads of states pledged for providing finances during 2016-2020, totaling USD 48 billion. Among the key contributors were Japan (USD 10B), EU (USD 11B), UK (USD 8.7B), France (USD 6.6B), Italy (USD 4 B) and USA (USD 4B) (UNFCCC website). It is noteworthy that USA which spearhead the abolition of mandatory emission reductions by developed countries and getting developing countries on board with them, made only a paltry USD 4 billion contributions up to 2020. Though USA withdrew from the PACC during President Donald Trump’s tenure, President Joe Biden has assured USA’s commitment to PACC.

The UNFCCC established the Green Climate Fund (GCF) in 2010 to collect funds from developed countries and disburse them among developing countries on the basis of proposals submitted by them for adaptation and mitigation projects, following their guidelines. The GCF has disbursed funds among 150 projects up to end of 2020 for both adaptation and mitigation projects. Some of the recent disbursements for mitigation projects are given in Table 1.

Table 1. Some recent disbursements made by GCF for mitigation

CountryProjectGrant

USDGHG saved

MtCO₂Approved DateIndia250 MW R/T solar 250 M5.2March 2018Zambia200 MW Solar PV154 M4.0March 2018Congo300 MW Solar PV with storage89 M0.51Oct 2018Nigeria400 MW solar PV467 M9.5Feb 2019Six in Africa214 MW solar PV150 M4.82019BangladeshEnergy efficiency in apparel industries340 M14.5Nov 2020

In addition, several multilateral banks operating in Asia, Africa and globally pledged finances up to USD 160 billion by 2020. Only a few projects are listed to save space. An interested reader may visit GCF website for a complete list at .

SRI LANKA’S SITUATION

To date, Sri Lanka has received funding from the GCF only for two adaptation projects described in Table 2.

Table 2. Adaptation Projects approved by GCF for Sri Lanka

Implementing AgencyProjectGrant

USDAffected CommunityApproved DateUNDPImproving resiliency of small holder dry zone farmers cultivating under village irrigation schemes52 M2.0 MJune 2016IUCNImproving resiliency of subsistence farmers in Knuckes Mountain Range49 M1.3 MMarch 2020

As for mitigation projects, Sri Lanka has not even prepared a country programme identifying projects to be submitted seeking funding even though discussions were being held during past few years. It is indeed a sad situation, which the President should look into, as this directly affects implementation of RE projects necessary to achieve his target. The responsibility for submitting project proposals to the GCF seeking funding lies with the Ministry of Environment which serves as the national focal point for UNFCCC.

It is a pity while least developed countries in Africa have managed to secure hundreds of million Dollars funding for implementing RE projects from international sources, Sri Lanka has not even identified suitable projects to seek funding. One reason could be that the country has too many organizations handling RE projects and sourcing funding and there isn’t any coordination among them. These include the Power Ministry, Renewable Energy Ministry, Environment Ministry, CEB, SLSEA, PUCSL and AG Department. The writer has written extensively on their conflicts both in the Island and other media and do not wish to repeat them here.

CONCLUSION

Dr TS has totally misunderstood the problem I posed in my letter to the Island of 19.02.2021 and writes a nonsensical response. He seems to turn a blind eye to the happenings at the Power Ministry and CEB for reasons best known to him. He should also be aware of the sources of funding available for implanting RE projects before making such statements that with losses incurred in selling electricity below cost for 10 years will surpass the money required to purchase COVID vaccines.

Since sourcing of funds for RE projects is critical for achieving the President’s target, he should look into the affairs of these organizations to streamline their activities with a view to expediting sourcing of funds. He should offer golden hand-shake to those who decline to cooperate.