Power purchases from Ace Power caused losses to CEB: JVP

Friday, 21 June 2019 00:00 - - {{hitsCtrl.values.hits}}

Ravi K says unfavourable power purchase agreement in place since 2005
Agreement extended since April 2016 as no solutions for power shortage

Extending a power purchase agreement with Ace Power Embilipitiya Ltd. has led the Ceylon Electricity Board (CEB) to incur a considerable loss over the years, Opposition lawmaker Sunil Handunnetti held in the Parliament yesterday.

Even though the agreement was entered during the Government of Opposition leader Mahinda Rajapaksa, with the plans for CEB to own the Ace Power Embilipitiya after a certain period of time, the final valuations have failed to meet the expectations of Aitken Spence, the holding company. As a result, the CEB has continued to purchase power from Ace Power Embilipitiya, a power plant technically owned by the Government. Power, Energy and Business Development Minister Ravi Karunanayake, explaining the facts that led to the unfavourable situation based on the power purchase agreement, which has been in place since April 2005, said: “A total amount of Rs. 120,996,861,298.26 has been paid to Ace Power Embilipitiya for the entire period. The company’s investment in the power plant was $ 61,155,144.”

Due to the disagreement and the bureaucracy within the CEB, the power purchase agreement has been extended in April 2016, March 2017, and in April last year. “The approval for the extension was obtained from the Public Utilities Commission for the first extension. According to section 15.1 of PPA the term can be extended by written agreement of the parties or in accordance with express provisions of this agreement. A no objection letter from the Public Utilities Commission was also in place for the extension on April 2016,” explained Minister Karunanayake. (AH)