Business
‘The devil is in the details’ in electricity sector reforms
By Ifham Nizam
Sri Lanka’s electricity sector is undergoing a seismic transformation with the proposed amendments in the Electricity Act No. 36 of 2024. With the primary aim of restructuring the Ceylon Electricity Board (CEB), these reforms promise to reshape the country’s energy landscape. But experts, including Professor Asanka Rodrigo from the Department of Electrical Engineering at the University of Moratuwa, caution that while the reforms hold potential, they could also lead to unintended consequences if not executed with clarity and precision.
The Institution of Engineers, Sri Lanka (IESL) initiated an open dialogue on the Ministry of Energy’s proposed amendments to the Electricity Act. Aiming to engage diverse stakeholders, the workshop titled ‘Power Sector Reforms: IESL Perspective’, was held last Friday at the IESL auditorium.
Rodrigo said that the proposed changes seek to restructure the current CEB into 12 independent entities, including four generation companies, a 100% government-owned National System Operator (NSO), a National Transmission and Network Service (NTNS) company, and four independent distribution companies. This restructuring intends to pave the way for a competitive wholesale electricity market within five years. However, despite the Act’s ambitious goals, the transition remains murky, with critics arguing that it lacks the comprehensive guidelines needed to ensure smooth implementation.
Rodrigo, an authority on electrical engineering, acknowledges the need for reform but emphasizes the importance of strategic planning. “The reform is undoubtedly necessary to foster competition and improve operational efficiency. But the devil is in the details, and right now, we lack the specifics on how to achieve these lofty objectives,” he states. One of his key concerns is the weak clauses within the Act regarding the transformation process, which could potentially undermine the very competition the reforms aim to establish.
In addition to restructuring, the Act also calls for the formation of a National Electricity Advisory Council tasked with advising the minister on energy policy. However, Rodrigo warns that certain provisions may allow for direct ministerial interference in regulatory affairs, raising concerns about the independence of the sector. “While governance should certainly be accountable, excessive ministerial control over the National System Operator is troubling. The sector needs an independent regulator to ensure impartiality and the long-term sustainability of the market,” he says.
The complexities deepen with the concept paper’s more intricate proposal, which suggests creating 14 state-owned companies instead of the initial 12. These include holding companies for generation, transmission, and distribution, along with a company for the CEB fund. Yet, questions remain about the necessity of additional holding companies that do not engage in core electricity sector operations. “Introducing more layers of bureaucracy without clear functions risks complicating the system instead of simplifying it,” he notes. “We need to ensure that each new entity has a distinct role and contributes to sector efficiency rather than creating redundancy.”
Perhaps one of the most contentious proposals is the reduction of the standardized power purchase agreement (SPPA) limit to plants not exceeding 1 MW, down from the current 10 MW. This decision has raised alarms among renewable energy advocates, who fear it will hinder the integration of solar, wind, and other renewable sources into the grid. “Renewable energy investments require stability and long-term planning, says Rodrigo. “By reducing the SPPA limit too drastically, we risk stalling progress and discouraging future investments in renewable energy.”
Rodrigo believes that the country must maintain a balanced approach to renewable energy integration. “While the reduction of the SPPA limit is intended to support smaller-scale projects, it should not come at the expense of larger, more impactful renewable energy investments, he advises. A gradual approach to reducing the SPPA limit, with clear incentives for renewable energy developers, would create a more favorable environment for long-term investment.
The Central Bank of Sri Lanka (CBSL) launched the Sustainable Finance Roadmap 2.0 on 05 May 2025 at the Atrium of CBSL, marking a key milestone in its continued efforts to foster a climate-resilient and socially inclusive financial system.
Recognising the growing implications of climate-related risks on price stability and financial system stability, CBSL introduced the first Sustainable Finance Roadmap in 2019, which provided foundational guidance to financial institutions on managing environmental, social, and governance (ESG) risks while encouraging financing for green and inclusive economic activities.
In light of evolving global developments, increasing access to climate-focused financing, and broader recognition of the social dimension of sustainability, CBSL developed the Sustainable Finance Roadmap 2.0 for the period 2025–2029, with technical and financial support from the International Finance Corporation (IFC) in partnership with the European Union, under the Accelerating Climate-Smart and Inclusive Infrastructure in South Asia (EU-ACSIIS) programme.
The Roadmap 2.0 was crafted in close collaboration with key stakeholders, including Securities and Exchange Commission of Sri Lanka (SEC), the Insurance Regulatory Commission of Sri Lanka (IRCSL), the Colombo Stock Exchange (CSE), the Sri Lanka Banks’ Association (SLBA), The Finance Houses Association of Sri Lanka (FHA), financial institutions and government bodies.
Focusing on Sri Lanka’s financial sector, the Roadmap 2.0 outlines a comprehensive set of prioritised actions for banking, non-banking, capital market, and insurance sectors. These actions are geared toward financing sustainable development, strengthening the management of environmental and social risks, enhancing reporting and disclosures, and improving governance and coordination across institutions.
The launch event was attended by distinguished guests including Gevorg Sargsyan, Country Manager for World Bank and IFC in Sri Lanka; officials of IFC and EU; Ministerial secretaries and senior officials of government institutions; national and international experts on sustainability; representatives of financial institutions and partner agencies.
Communications Department 05.05.2025 2 Delivering the keynote address, Dr. P. Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka, emphasised that the launch of Sustainable Finance Roadmap 2.0 marks a vital step in strengthening the resilience and inclusiveness of Sri Lanka’s financial sector amid growing climate and social challenges. He highlighted the need for urgent, coordinated action to integrate climate risk into financial decision-making and called for strong stakeholder collaboration to ensure effective implementation of the Roadmap 2.0.
Speaking at the event, Gevorg Sargsyan, Country Manager for World Bank and IFC in Sri Lanka, noted that as Sri Lanka strives for resilient and inclusive growth, sustainable finance will be crucial in creating jobs and driving economic expansion, while also positioning the country to be investment ready. He further highlighted that building a truly sustainable financial ecosystem in Sri Lanka is a collective endeavor – one that IFC has been a part of from inception, and remains committed in working together with the Central Bank of Sri Lanka and industry stakeholders to bring the shared vision of the Sustainable Finance Roadmap 2.0 to fruition.
The keynote was followed by a session providing an overview of the Sustainable Finance Roadmap 2.0, led by Ms. W. A. Dilrukshini, Assistant Governor of CBSL, and Ms. Wei Yuan, ESG Officer of IFC. A panel discussion on “Rolling Out the Sustainable Finance Roadmap 2.0” featured Dr. Thusitha Sugathapala, National Technical Expert on Sustainability; Ms. S. Ketawala, Additional Director of the Bank Supervision Department of CBSL; Thimal Perera, Chief Executive Officer of DFCC Bank; and Ms. Nilupa Perera, Chief Regulatory Officer -Designate of CSE.
The Sustainable Finance Roadmap 2.0 can be accessed using the following link:
https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/sustainable_finance_roadmap_2.0.pdf
Browns Investments PLC (BIL), the investment arm of the LOLC Group, has announced a significant expansion of its plantation portfolio with the acquisition of FLMC Plantations (Pvt) Ltd (FLMC). The acquisition was completed on May 5, 2025, through a Share Sale and Purchase Agreement with Damro Manufacturing (Pvt) Ltd and Piyestra Furniture (Pvt) Ltd, for a total consideration of LKR 4.8 billion.
FLMC Plantations serves as the holding company and managing agent for Pussellawa Plantations Ltd (PPL) and Melfort Green Teas (Pvt) Ltd. PPL operates over 11,500 hectares of land across 24 estates, managing 5,400 hectares of tea, 5,900 hectares of rubber, and 200 hectares of minor crops. The estates collectively produce 4.3 million kilograms of made tea and 2.3 million kilograms of rubber annually. Strategically located in Sri Lanka’s renowned tea-growing regions, including Pussellawa, Udupussellawa, Nuwara Eliya, Kandy, Ruhuna, and Sabaragamuwa, these estates will further enhance BIL’s presence in the country’s agricultural landscape.
Commenting on the acquisition, the Group Managing Director/ CEO of LOLC Holdings PLC, Kapila Jayawardena stated, “Over the past two decades, LOLC Group has been guided by a bold vision of expansion and diversification, positioning ourselves as a global powerhouse across multiple sectors. Our acquisition of FLMC Plantations through Browns Investments PLC is another key milestone in strengthening our leadership in agriculture and plantations. With the addition of Pussellawa Plantations and Melfort Green Teas, we are not only expanding our footprint in Sri Lanka’s premier tea-growing regions but also enhancing our ability to supply premium-quality tea to global markets.’’
Business
VFS Global acquires majority stake in CiX Citizen Experience to create a centre of excellence
Supercharged Growth: VFS Global’s partnership will accelerate CiX’s expansion across Brazil, Latin America, and beyond.
Global Powerhouse: With VFS Global’s capital, technology, talent and scale, CiX Citizen Experience will bring new products and technology to the global marketplace.
Quality of Life Commitment: Both companies are dedicated to innovative solutions, including the use of AI, that improve citizens’ quality of life
Local Impact with Wider Reach: Collaboration to modernise services for citizens of Brazil by creating a centre of excellence that stands as a global example.
VFS Global, the global leader in trusted technology services, empowering secure global mobility for governments and citizens, has completed the acquisition of a majority stake in CiX Citizen Experience, a leading provider of digital and physical citizen services based in Brazil. This strategic acquisition marks a pivotal step in VFS Global’s expansion journey—particularly across Latin America (LATAM)—as it continues to broaden its capabilities and deepen its impact in the public service delivery space.
With nearly two decades of pioneering innovation in citizen services, CiX has established a strong presence in Brazil. This success will be further scaled across LATAM and other global markets, leveraging VFS Global’s international reach and operational excellence.
This acquisition is centred on driving transformation through advanced digital technologies, including AI and data-driven platforms. By uniting CiX’s cutting-edge digital capabilities with VFS Global’s extensive global infrastructure and expertise in managing complex service ecosystems, we are positioned to deliver next-generation, integrated solutions to public and private sector clients around the world.
For both companies’ client governments and partners, this will lead to enhanced, tailored solutions that improve citizen engagement, access, and satisfaction.
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