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Electricity tariff hike raises questions over fuel pricing transparency

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Electricity power lines in Sri Lanka’s countryside. (File photo

The much discussed latest electricity tariff debate has taken a controversial turn, with senior power sector officials and independent energy analysts questioning whether opaque fuel pricing mechanisms are artificially inflating the cost of electricity generation while shielding politically sensitive petroleum losses.

At the centre of the controversy is the widening gap between diesel pricing and the steep increases imposed on Heavy Fuel Oil (HFO) and naphtha — two fuels heavily used by the Ceylon Electricity Board (CEB)⁠� for thermal power generation.

Energy analysts argue that while electricity tariffs are officially calculated on a “cost reflective” basis, the fuel pricing structure feeding into those calculations appears far from transparent.

A senior CEB official told The Island Financial Review that the present fuel pricing pattern raises “serious economic and policy concerns.”

“The entire electricity tariff framework is built on the assumption that fuel supplied to the power sector reflects actual import costs. But if fuel pricing itself is distorted, then tariff calculations become distorted too,” the official said.

According to CEB operational data reviewed by sector analysts, the utility regularly consumes nearly two-and-a-half times more HFO than diesel for thermal generation. Yet recent fuel revisions saw diesel prices rise only marginally — despite allegations that diesel cargoes had been procured at extraordinarily high dollar values.

Industry analysts pointed out that diesel imported at around USD 286 per barrel resulted in only about a Rs. 10 domestic price increase, while HFO prices surged by nearly Rs. 42 per litre and naphtha by around Rs. 34 — increases estimated at roughly 25 percent.

“This creates the impression that losses on diesel are being absorbed by overpricing HFO and naphtha,” an energy economist said.

“If CPC is maintaining artificially low diesel prices for political or inflation management reasons, the burden appears to be transferred to electricity consumers through thermal generation costs.”

The analyst noted that because the CEB relies heavily on HFO for regular dispatch operations, even relatively small increases in HFO pricing can translate into billions of rupees in additional annual generation costs.

In dollar terms, the implications are substantial.

Power sector officials estimate that every major upward revision in HFO pricing adds several billion rupees to annual generation expenditure, particularly during periods of low hydro availability. Given the depreciation pressures on the rupee and the dollar-denominated nature of fuel imports, the resulting tariff burden on consumers becomes even more severe.

A second senior CEB official expressed concern that institutional checks and balances within the energy sector appeared to be weakening.

“There is growing concern within the industry that the electricity sector regulator is no longer functioning with the level of independence expected of it,” the official said, referring to the Public Utilities Commission of Sri Lanka (PUCSL)⁠.

“The regulator’s responsibility is to independently scrutinise cost submissions, fuel assumptions and tariff calculations. But many in the sector now feel there is inadequate challenge or verification of the numbers being presented.”

The official warned that if regulatory independence is perceived to be compromised, public confidence in tariff revisions could deteriorate further.

A senior engineer attached to the CEB said the issue goes beyond tariff formulas.

“What is missing is cost transparency. There is no publicly accessible breakdown showing actual landed fuel costs, financing charges, hedging exposure, exchange losses, or refinery margins. Without that, nobody can independently verify whether the fuel pricing is truly cost reflective.”

Analysts also questioned the apparent disparity between crude oil acquisition costs and refined fuel pricing adjustments.

“If crude was purchased at almost the same price range, why are HFO and naphtha seeing disproportionate hikes while diesel remains comparatively protected?” one analyst asked.

Several observers believe the answer may lie in broader political and financial calculations.

Keeping diesel prices artificially low helps contain inflationary pressure across transport, logistics and food supply chains. However, critics say it may also help suppress scrutiny over controversial diesel procurements carried out at elevated international prices.

Energy sector sources further alleged that maintaining a lower diesel benchmark may also indirectly soften calculations linked to the long-running coal procurement controversy, where comparative generation cost modelling often references diesel-based thermal pricing.

“This has major political implications because lower diesel benchmarks can influence public perception regarding coal generation economics,” an analyst said.

By Ifham Nizam



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Malaysia courts more Sri Lankan travelers as ‘Visit Malaysia 2026’ gathers steam

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Malaysian H.C. Badli Hisham Adam: ‘Fresh biz opportunities

Malaysia is intensifying efforts to attract more Sri Lankan travelers by promoting its diverse tourism offerings, strong air connectivity, Muslim-friendly facilities and expanding business partnerships ahead of the ‘Visit Malaysia 2026’ (VMY2026) campaign.

Addressing the Tourism Malaysia product presentation yesterday in Colombo, Malaysian High Commissioner to Sri Lanka Badli Hisham Adam said tourism remains one of the strongest pillars of the long-standing bilateral relationship between Malaysia and Sri Lanka, helping strengthen cultural understanding, business links and people-to-people ties.

The event, organised by Tourism Malaysia Chennai in collaboration with the High Commission of Malaysia in Colombo, brought together Malaysian tourism stakeholders, airline representatives, Sri Lankan travel industry professionals and members of the media to explore new business opportunities.

The High Commissioner said Sri Lanka continues to be an important source market for Malaysia, with growing numbers of Sri Lankan travelers seeking destinations that combine diversity, affordability, quality experiences and convenient connectivity.

“As part of ‘Visit Malaysia 2026’, we warmly invite Sri Lankan travelers to discover the richness of Malaysia, he said.

Highlighting Malaysia’s tourism strengths, the envoy said the country offers a wide range of attractions, including multicultural cities, UNESCO World Heritage Sites, pristine beaches, tropical rainforests, cool highlands and unique wildlife.

These are complemented by world-class shopping, family-friendly attractions, educational opportunities, wellness and medical tourism, business events and internationally renowned hospitality.

He also stressed Malaysia’s position as the world’s leading Muslim-friendly destination, supported by an extensive halal ecosystem with internationally recognised certification, halal-certified restaurants, easily accessible prayer facilities and family-oriented amenities across the country.

Despite ongoing geopolitical uncertainties around the world, the High Commissioner said Malaysia remains a stable, peaceful and welcoming destination for international travelers.

He urged Sri Lankan travel agents to strengthen collaboration with Malaysian tourism providers by developing innovative travel packages targeting leisure travelers, business visitors and event participants.

The presentation featured leading Malaysian tourism partners, including Wyndham Ion Majestic, Lotus Desaru, Key Term Holidays representing the Sabah Tourism Board and Asian Overland representing The PULSE Group, showcasing Malaysia’s diverse tourism experiences and investment in the Sri Lankan market.

The envoy also acknowledged the contribution of airline partners and the media in enhancing Malaysia’s visibility and improving travel connectivity between the two countries.

Looking ahead to ‘Visit Malaysia 2026’, he said the future growth of tourism would depend on stronger collaboration, innovation and meaningful partnerships between industry stakeholders.

He expressed confidence that closer cooperation between Malaysia and Sri Lanka would generate fresh business opportunities while encouraging more Sri Lankan visitors to experience Malaysia’s culture, diversity and hospitality.

The High Commissioner concluded by expressing hope that the networking session would lead to stronger commercial partnerships and contribute to the success of ‘Visit Malaysia 2026’, further deepening tourism and economic ties between the two friendly nations.

By Ifham Nizam

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Women Empowered Global launches ‘Leadership Lab’

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Senela Jayasuriya, Founder and CEO of Women Empowered Global.

Women Empowered Global (WEG), a network of award‑winning female leaders, corporate CXOs and entrepreneurs, experts and thought leaders dedicated to empowering women from six continents, unveiled the ‘WEG Leadership Lab’, a 24‑week virtual intensive programme, commencing 26 September. The programme is designed exclusively for women leaders who are ready to accelerate their careers, amplify leadership visibility, and drive transformational growth.

The women‑only leadership experience breaks the mould of conventional training, offering a powerful blend of masterclasses, mentorship, and practical leadership tools tailored for rising leaders, managers, and senior professionals. Participants will gain international exposure, sharpen essential skills, and the opportunity to join a vibrant knowledge‑sharing community which fosters confidence, resilience, and impact.

“The WEG Leadership Lab is not for casual growth. It is for women who are serious about transforming their leadership journey,” said Senela Jayasuriya, Founder/CEO, Women Empowered Global. “By combining global expertise with local delivery, we are creating pathways for women across manufacturing, trading, finance, marketing, technology, and management, as entrepreneurs, business owners, fractional executives, or corporate leaders, to thrive and build a more inclusive leadership landscape.”

WEG’s platform facilitates international exposure and career development for professionals and connects more than 4,000 members worldwide. The Leadership Lab builds on WEG’s flagship initiatives, including the 1 Million Women in Power campaign, the African Women Leadership Forum, the Business Hub, and the Global Online Academy. The programme aims to deliver a transformative journey equipping women to step boldly into leadership roles locally and internationally.

Led by Senela Jayasuriya (MBA, UK), an internationally recognized and awarded leadership & empowerment coach and innovation partner, keynote speaker, and certified expert, WEG collaborates with DEI specialists, corporate boards, Business and HR leaders, to design programmes which advance women’s careers, leadership visibility, equity, and inclusion. To date, she has successfully delivered leadership development programmes to more than 20,000 professionals.

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JKCG Auto and Green EV join forces to build Sri Lanka’s most expansive EV charging network

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John Keells CG Auto (JKCG Auto), the authorised distributor of BYD and Denza in Sri Lanka, has launched a strategic partnership with Green EV on 26th June 2026 to significantly expand the charging infrastructure available to its customers across the island. The collaboration, formalised through a Memorandum of Understanding (MOU), marks a pivotal step in JKCG Auto’s ongoing commitment to building a comprehensive and reliable New Energy Vehicle (NEV) ecosystem in Sri Lanka.

Through this partnership, BYD and Denza owners will gain seamless access to Green EV’s public charging network of 100+ DC fast chargers and 70 AC chargers, spanning 20 districts and all nine provinces of Sri Lanka, from Jaffna in the north to Hambantota in the south, and from Puttalam on the northwest coast to Trincomalee and Ampara on the eastern seaboard, encompassing a mix of 40kW, 60kW, and 120kW fast-charging infrastructure. The network has been designed to ensure that customers can charge conveniently and confidently, whether in the heart of Colombo or in suburban and outstation communities, removing one of the most commonly cited barriers to EV adoption in Sri Lanka. Further strengthening customer confidence, Green EV has partnered with SLIC to provide a comprehensive insurance cover of LKR 100 million for every Green EV charging station, offering protection against potential damages and ensuring complete peace of mind for every user.

The initiative reflects JKCG Auto’s broader strategy to invest in the foundations of sustainable mobility, ensuring that the transition to electric vehicles is supported not only by world-class vehicles, but by a dependable ecosystem that addresses the practical needs of everyday ownership.

“If the future of mobility in Sri Lanka is going to be electric, success will hinge on how accessible we are able to make the actual vehicles, as well as the enabling infrastructure around them. JKCG Auto is proud to partner with other visionaries like Green EV to ensure that we eliminate range anxiety, so that every customer – whether in Colombo or anywhere in Sri Lanka will have the confidence to go electric,” JKCG Auto Chief Executive Officer, Charith Panditharatne.

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