The NPP government’s coal procurement process has once again come under scrutiny following allegations by the Frontline Socialist Party (FSP) that substandard coal has been imported for power generation and that tender procedures were manipulated to favour a specific supplier.

Addressing the media after a party meeting in Maharagama on Saturday, FSP Education Secretary Pubudu Jagoda said a test report issued by the government laboratory at the Lakvijaya Power Plant had confirmed that the latest coal shipment unloaded in Sri Lanka did not meet the required quality standards. According to the report, the coal’s calorific value ranged between 5,600 and 5,800 kilocalories per kilo, below the 5,900–6,200 kCal/kg range specified in tender requirements.

Jagoda warned that lower calorific value coal would require higher volumes to generate the same amount of electricity, increasing costs significantly. Preliminary estimates, he said, indicated an additional financial burden of around Rs. 7,500 million, which might eventually be passed on to consumers through higher electricity tariffs.

The FSP also accused the government of tailoring procurement rules to benefit the Indian supplier, which has deposited bonds for long-term coal supply for the upcoming season. Jagoda alleged that tender conditions had been altered to accommodate the company, pointing to changes in coal reserve requirements. Under the 2021 Sri Lanka Coal Registration Document, suppliers were required to maintain a minimum reserve of one million metric tonnes with a gross calorific value of 5,900 kCal/kg. This threshold, he said, had been reduced to 100,000 metric tonnes in the 2025 document which is a 90% reduction raising serious concerns.

He further cited past allegations against the Indian company, including findings in a 2016 Auditor General’s report that the company violated procurement guidelines regarding a rice supply contract with Sathosa in 2014. Jagoda also referred to legal issues involving individuals linked to the company, and the suspension of a representative by the International Cricket Council in 2019 over match-fixing allegations.

Beyond company-specific concerns, Jagoda criticised what he described as systemic manipulation of the coal tender process. He questioned why the coal tender, typically called in February or March, was delayed until July, despite electricity being declared an essential service. He also alleged that the tender submission period had been progressively shortened from the internationally accepted six weeks to five weeks, and now reportedly to three giving an unfair advantage to suppliers with existing stock.

The Ministry of Energy has recently issued an amended tender to procure 4.5 million metric tonnes of coal for the Lanka Coal Company for the 2025/26 and 2026/27 periods, following the cancellation of an earlier tender.

Jagoda warned that delays and irregularities could lead to coal shortages, higher spot market purchases, increased electricity costs, and even power cuts if hydropower generation falls short. He called for urgent investigations into the procurement process, insisting that the burden of alleged mismanagement and corruption must not be transferred to the public.

by Chaminda Silva ✍️