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Dark side of the energy picture in Sri Lanka

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The “rural energy crisis” has been receiving increasing attention from development policy makers because it affects the very survival of the vast majority of the world’s population, who live in the rural areas of the developing countries, and is also deeply inter-linked with the whole concept of sustainable development. The linkages between rural energy and sustainable development, however, need to be understood in the overall context of the energy situation in the developing countries. This also falls extremely well with SDG 7 of Agenda 2030 as an essential and a vital strategy of achieving the same.

The key message for policymakers is: Give wood energy a fair chance in the energy mix of your country in order to make the world a more sustainable and more environmentally friendly place.

Deviating from the conventional classification of energy as fuel sources which hides many development issues ,the Sri Lanka energy demand can be identified as consisting broadly of two major groups of energy (1) Centralized Commercial Energy consisting of electricity, fossil fuels and commercial renewable energy sources (2) Decentralized non commercial energy consisting of mainly biomass and other indigenous energy resources.

According to Sustainable Energy Authority (SEA) data, the largest component of energy demand in Sri Lanka in 2018 is for biomass energy amounting to 46.2.followed by 41% petroleum and 12.3% electricity (energy balance 2018). Biomass is also the main source of energy in household and industry comprising of 64..9% and 74..7 % respectively which highlights its importance as the life blood of the rural sector comprising of 81% of the total population and the industrial sector.

It is evident that burden of meeting the energy needs of group 1 has been carried out not by the government but by the rural people themselves led by the women to secure the sustenance and the livelihoods of the rural people for which government has not shown any appreciation or any interest. The mundane fact is that 191.4 PJ of energy amounting to 46.2% of the energy mix has never been the concern of the energy sector planning. What matters should not be the type of the energy source or fuel but the energy service provided which are the heat, light, mechanical and digital energy requirements.

While the energy sector should be congratulated for achieving 100% electrification in Sri Lanka which is a remarkable achievement, the present portfolios of Ministries in the energy sector focus only on Petroleum, Power and Renewable Energy Solar, Wind and Hydro Power Generation Projects Development . The major source of noncommercial biomass is overlooked . It is also observed that the term energy has been violated by identifying petroleum under the ministry of energy which is a misnomer which can create contradictions in policy matters as the term energy is used to encompass all energy resources.

The energy sector has incurred Rs 699 billion in foreign exchange almost 32% of the export earnings and an enormous expenditure to maintain a strong organizational infrastructure to cater for the commercial energy needs while neglecting the non commercial energy needs of the rural and estate poor.

This trend of depending on biomass has prevailed through out the last four decades and considering the present inequality in income distribution, it is likely to continue since affordability of modern fuels for the poor will not be a reality in the near future. This is evident from the fact that 30% of poorest get nine percent, the middle 40% get 29% and the richest 30% get 62% of the government income(Central Bank 2017 data) . A World Bank study states, at today’s prices that world LPG prices, regular users of LPG would likely need monthly household income in excess of US$350 and require at least 15 USD/month.

The Role of Liquefied Petroleum Gas in Reducing Energy https://openknowledge.worldbank.org › )

Nevertheless, presently there is a lack of focus on biomass energy by the government particularly due to the need for heavy focus on modern fuels for development of the country In contrast the important role played by biomass energy for the subsistence and economic development in the rural sector is not visible due to the decentralized and noncommercial nature of uncoordinated informal activities consisting of large number of stakeholders in the non-energy sector with a multitude of objectives not directly related to energy per se. Biomass energy is really not produced by the energy sector but a by product of activities carried out by the forestry, agriculture and plantation sectors which is not their main objective thus making biomass no one’s baby.

It is observed that this complication of uncoordinated, informal relationships and lack of insensitivity of the government which have contributed towards lack of governance within the energy sector in Sri Lanka have further isolated the low income rural sector to find their own solutions for survival. Non-cognizance on low-cost, improved biomass solutions has led to a scenario where biomass energy is negatively perceived with detrimental effects on sustainable development. It is totally unwelcoming to see that there is no appropriate mechanism devoted to the management of indigenous energy resources which still serves as the energy backbone of Sri Lanka.

The negative image of biomass, tends to be associated with deforestation, climate change under-development,  poverty and negative health effects. This image steers policy makers towards the replacement  of   biomass by other fuels, instead of improving  sustainability of the sector with integrated and holistic approaches.

In spite of the focus on alternatives, it is unlikely that biomass use will decrease in absolute terms over the coming decades. There is no evidence to show that firewood use is contributory factor to deforestation. Main four reasons for deforestation in Sri Lanka are encroachments due to agriculture, gem mining and settlements, infrastructure development projects, commercial agriculture ventures and several localized drivers like cattle grazing, cardamom cultivation and forest fires. (Kariyawasam, Ravindra, and Chinthka Rajapakse).

However, despite of the fact that, firewood is underestimated and ridiculed as a primitive fuel, the use of firewood by a majority of the population of Sri Lanka has not deprived but contributed towards the wellbeing of Sri Lanka in achieving many development indicators in moderation compared to many middle income countries. For an example according to world rankings, Sri Lanka’s rankings are Human Development Index 71, health 48, social capital 33, prosperity 84 and education 62. Moreover, a female born in Sri Lanka can expect to live 80.1 years (despite using firewood for cooking ) as oppose to 79 years in America). Infant Deaths/1000 in Sri Lanka is six, where it is six in America and 27 in India .

In the name of good governance and justice it is high time that the Ministry of Power and Renewable Energy (Sustainable Energy Authority) take action to avoid a looming disaster in the near future due to the informal nature of biomass supply and use of biomass is allowed to continue without inputs from the government which not only create social instability also hamper the efforts of achieving sustainable development goals.

The scope for the government is to facilitate the availability of supply, provide low cost technology support for efficient use by improving access to ventilation and efficient use through improved stoves and mitigate negative impacts on health and climate as alleged by the international community. Nearly eight million tons of firewood is required annually for cooking and livelihoods and four million tons of firewood for the industrial sector. Each house would require nearly two tons/year. Meeting this target would require the coordination and integration of the various stakeholder activities already providing informal facilitation in unofficial ways.

Although negative perceptions of biomass energy are widespread, biomass is not necessarily an unsustainable or backward fuel. Sustainability depends on the practices applied in the value chain; for example forest management techniques and the efficiency of conversion and use. These commonly held misconceptions tend to associate biomass fuels with deforestation, indoor air pollution and underdevelopment.(European Union Energy Initiative and GIZ, Germany ). http://www.euei-pdf.org/fr/node/3880.

In the name of governance in the energy sector in Sri Lanka, the objective of this article is to request the Sustainable Energy Authority which has been given the mandate to promote renewable energy (not only commercial energy) to take the leadership and initiative to invite the relevant stakeholders, donors, NGOs for a consultative meeting with a view to identify stakeholders and cross cutting activities, linkages and capacity and make aware the importance of rural sustainable energy interventions which needs the formation of a network of organizations to be established under the local government ministry facilitated by the sustainable energy authority comprising of specially dedicated staff to biomass energy development.

R.M.Amerasekera. Eng

Executive Director, Integrated Development Association (IDEA)

Energy Advisor to Former Minister of Local Government Admiral Sarath Weerasekara

Project Manager, National Fuel Wood Conservation Programme

Electrical Engineer (Alternative Energy Development Unit, CEB)

Retired Director, Sustainable Energy Authority

Short term Consultant to the UNDP(Sudan), World Bank and FAO

Recipient of First Ever Sri Lanka Energy Efficiency Award(2015), Awarded by HE the President

for bringing sustainable energy solutions to people

Recipient of Mohan Munasingha Award (1985) for Energy Conservation Efforts

Nominee for World Clean Energy Award(2007)



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Pacific Textiles chairman Masaru Okutomi appointed Director of Teejay Lanka

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Teejay Lanka PLC has announced the appointment of Masaru Okutomi, the Chairman and CEO of Pacific Textile Holdings Limited of Hong Kong, as a non-executive Director of the Company with immediate effect.

Okutomi replaces Wan Wai Loi on the Board of Teejay Lanka PLC, consequent to a change in the latter’s role on the Board of Pacific Textiles, which has a 28 per cent stake in Teejay Lanka, the Company said.

Okutomi has a Bachelor’s degree in Law from Hitotsubashi University, one of Japan’s top universities, and held senior management positions including Managing Director of Toray Industries (South China) Co. Ltd. and of Toray Industries (Hong Kong) Ltd., Deputy Managing Director of Toray Industries (China) Co. Ltd. in the past.

He was re-designated from Vice-Chairman to Chairman and CEO of Pacific Textiles, a leading manufacturer of customised knitted fabric with an annual production capacity of approximately 87 million kg, on 1st October 2021, and leads the Group’s management team, overseeing overall production and operations, providing corporate direction and formulating business strategy.

Welcoming Okutomi to the Board of the Company, Teejay Lanka Chairman Bill Lam said his extensive experience in the management of a globally-significant textiles business would be an asset to Teejay’s own growth and expansion aspirations as it progresses towards its target of becoming a US$ 300 million business. “We also thank Wan Wai Loi, for his exemplary service as a Board member of Teejay Lanka PLC,” Lam said. “He has done yeoman service shaping the journey of Teejay Lanka for the past 11 years and his guidance and wealth of knowledge was greatly appreciated by all his peers on the Board.”

Sri Lanka’s largest textile manufacturer and the first textile manufacturer in the country to receive membership of the US Cotton Trust Protocol, Teejay Lanka PLC is a public quoted company with 39 per cent public ownership. The company is backed by Sri Lanka’s largest apparel exporter Brandix Lanka which has a 33 per cent stake. Pacific Textiles of Hong Kong whose key shareholder is the Tokyo Stock Exchange listed Toray Industries Inc., owns 28 per cent of Teejay Lanka.

The Company has been adjudged the Best Textile Exporter in Sri Lanka at the Presidential Export Awards presented by the Export Development Board (EDB) and has been named among the 100 Most Respected Companies in Sri Lanka by LMD.

An ISO 9001:2015, ISO 14001:2015 and OHSAS 18001:2007 compliant company and the first in the industry to develop green fabric, Teejay has been listed on the Colombo Stock Exchange (CSE) since 2011 and was included in the S&P Top 20 Index in Sri Lanka. The Company has also been named among the Forbes ‘200 Best under a Billion in Asia’ and been recognised as the ‘International Textile Firm of the Year’ and the ‘International Dyer and Finisher’ by World Textile Institute, London.

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Sri Lanka ranks 2nd at Allianz World Run, contributing towards countries in need

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Allianz Lanka once again partnered with other Allianz offices from around the world to raise much needed funds to mitigate critical issues facing countries ravaged by the COVID-19 pandemic, via the Allianz World Run, an initiative that seeks to inspire Allianz team members as well as their friends and family to undertake recreational physical activity that ultimately helps tackle pressing global issues.

The Allianz World Run, this time in its 6th edition, took place throughout both the Olympic and Paralympic Games, thus motivating participants to give of their best, embracing the true Olympic spirit. Held over 90 days, the program saw a total of 12,418 participants from 69 teams contribute 2,531,091 KMs, at an average of 203 KMs per participant, being active for a total of 55,080,546 minutes. Sri Lanka contributed with 975 participants running 201,423 KMs, an average distance of 207 KMs per participant for a total of 118,509 minutes, a feat that placed the island nation 2nd in terms of participants and 3rd in terms of contribution of KMs

Speaking at the conclusion of the event, Gany Subramaniam, Chief Executive Officer, Allianz Insurance Lanka Limited said, “We are very proud to maintain our standing at the Allianz World Run this year, which is testament to the resilience and spirit of our Sri Lankan people to never back down and to keep fighting for the sake of our fellow man. Even as we grapple with our own issues and uncertainties caused by the global pandemic, I am truly amazed at the outpouring of support for this initiative and can only say thank you to everyone who participated. I humbly hope this serves as an inspiration to everyone, across the globe, that with courage and determination there is no obstacle humanity cannot defeat.”

In keeping with the Olympic & Paralympic Games and bearing in mind the deadly pandemic facing the world, this year the Allianz World Run introduced a Digital Workout Challenge to ensure participant safety, whereby all runners joined the Allianz World Run community and all their active minutes contributed to Allianz World Run Charity Milestones. Participants could join any activity they chose, so long as it was tracked in the ‘Well Together’ app.

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Tile sector counters in positive performance

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By Hiran H. Senewiratne

CSE trading witnessed some volatility because the market noted profit -taking on the previous day. But tile sector counters performed positively yesterday, stock market analysts said. Further, with the month end being reached, the profit takings were noted during the day.

The stock market remained buoyant with high turnover. Royal Ceramic share price appreciated by five percent or Rs.2.70. Its share price started at Rs 54.10 and at the end of the day it shot up to Rs 56.80.

The indices continued their record-breaking streak on the back of stronger-than-expected financial results reported by a string of companies in the ongoing earnings season.

“As successive record highs were recorded, the ASPI breached the 10,100 level for the first time and ended in green for the seventh consecutive session while the S&P SL20 index also closed higher to surpass its previous peak recorded on Monday, stock analysts said.

Amid those developments both indices moved upwards. All Share Price Index went up by 17.16 points and S and P SL20 rose by 36 points. Turnover stood at Rs five billion with a single crossing. The crossing was reported in Distilleries, which crossed 10 million shares to the tune of Rs 176 million and its shares traded at Rs 17.50.

In the retail market top five companies that mainly contributed to the turnover were; Expolanka Holdings Rs 1.1 billion (4.9 million shares traded), Browns Investments Rs 752 million (6.6 million shares traded), Royal Ceramic Rs 315 million (5.6 million shares traded), ACL Cables Rs 275 million (four million shares traded) and HNB Rs 184 million (1.1 million shares traded). During the day 194 million share volumes changed hands in 36000 shares.

Sarvodaya Development Finance (SDF) recently announced its Initial Public Offering (IPO) proposition and will be allowing potential investors the ability to submit applications for the IPO, which will open on November 23, 2021.

SDF is a dynamic financial services provider that aims to uplift and empower rural masses across the nation by facilitating development opportunities with the prime goal of securing equitable economic growth and driving national development.

Investors stand to gain a range of benefits related to the forecasted highly positive company performance levels in the near future, offering investors the chance to invest into empowering Sri Lanka’s village entrepreneurs, while securing consistent returns, observers said.

Managed by NDB Investment Bank, Sarvodaya Development Finance will offer up to 45,454,546 ordinary voting shares at a price of Rs 22.00 per share through its IPO, resulting in a projected market capitalization of Rs 3.29 billion assuming full subscription at the Issue Price. This translates into an estimated forward PER of 16.17 for FY22 and implied TTM PER (as at August 31, 2021) of 11.02x.

Yesterday the US dollar was quoted at Rs 202.20, which was the controlled price of the Central Bank to prevent price escalations in essential food items in the country.

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