By the Daily FT News Desk
The Government has assured the country’s apex court that it will not pursue a coal-fired power project in Sampur due to opposition by environmental groups, a decade after Sri Lanka signed a joint venture with India to construct the plant.
When the case against the Sampur coal-fired power plant filed by the Environmental Foundation Ltd. (EFL) was taken up in the Supreme Court yesterday, Additional Solicitor General Sanjaya Rajaratnam told the court that the Ministry of Power and Energy had decided a coal power plant would not be constructed in Sampur in the Trincomalee District.
As a result of the assurances by the Government, EFL has informed the Supreme Court that it was withdrawing its fundamental rights petition. “EFL then told the court it would not proceed with the petition and the proceedings were terminated,” EFL Head of Legal Gayani Hewawasam told Daily FT. However, EFL reserves the option to return to court if the Government changes its policy.
Power and Energy Ministry Secretary Dr. B.M.S. Batagoda noted India had already agreed to a Sri Lankan proposal to build a LNG power plant. President Maithripala Sirisena earlier this year had proposed the change during a tour of India during which he met with Prime Minister Narendra Modi.
“The Ceylon Electricity Board (CEB) does not want the LNG plant to be set up in Sampur. They prefer the plant be constructed in Kerawalapitiya. So there will be no coal power plant in Sampur,” he said.
The Public Utilities Commission of Sri Lanka (PUCSL), the regulatory body of the CEB, believes any alternative to the Sampur coal power plant has to be included in the CEB’s long-term generation plans that have to be submitted by April 2017, giving them about eight months to iron out details of the proposed LNG facility.
Environmentalists and residents have protested about the adverse impacts of coal-fired power generation in proximity settlements and its impacts on the marine ecosystem and flora and fauna of the region.
In 2006, the Ceylon Electricity Board signed a joint venture with the National Thermal Power Corporation Ltd. (NTPC) of India. The MoU was a tripartite agreement between the NTPC, CEB and Government of Sri Lanka.
In 2011, the Trincomalee Power Company, jointly managed by the CEB and NTPC, was instituted to produce and sell power generated by coal-fired technology to the state energy provider. The jointly managed company was to establish two coal-based power plants with a total generation capacity of 500 megawatts, covering 505 acres of land in Sampur. The project was set to be commissioned by the end of 2017.
The Sampur coal power project has political and diplomatic implications, due to agreements with the Indian firm that stemmed from a bilateral agreement between Sri Lanka and India signed in 2005. The Government has not immediately made it clear if it was unilaterally abrogating its agreement with the Indian firm.
The Indian Government maintains it has received no official notice from the Sri Lankan Government about the cancellation of the project.
“We have not received any updates on the Sampur issue from the Government of Sri Lanka,” Indian High Commission Spokesperson Esha Srivastava said responding to yesterday’s court proceedings.
Speaking to Daily FT, Director Development of Power and Energy Sulakshana Jayawardane said the Attorney General had queried the Ministry’s position on the Sampur project after EFL filed legal action. “The Secretary of the Ministry informed the AG that the Ministry was categorically not going forward with the Sampur coal-fired power plant,” Jayawardane said.
According to Jayawardane, the Power and Energy Ministry had held discussions with the Indian thermal power company with regard to the Government’s green energy policy. “Discussions about dropping the coal power project have been held between the two Governments at higher levels as well,” he added. The Ministry official did not indicate if the Government’s formal discussions with NTPC on changing the type of fuel for the proposed Sampur plant from coal to a greener source of energy had reached a conclusion before the Ministry provided assurances to court.
The Joint Venture project was estimated to cost $ 612 million. Jayawardane said the CEB and the NTPC would have to jointly bear the cost of environmental and technical assessments obtained for the project so far. “If there is no coal power plant, then we have to bear the cost,” he said. The Ministry was unable to assess that cost immediately, he added.
Jayawardane defended the Government’s position on the coal power project, saying that environmentally friendly energy was the global trend.
In the Supreme Court in July 2016, Counsel for the EFL K. Kanag-Isvaran PC said his client would drop its fundamental rights action if the Government provided assurances to court that it would not go ahead with the coal power project.
Kanag-Isvaran PC informed court that the Government had made a policy decision to pursue green energy projects and intimated that it would swap the coal-fired Sampur plant for a power generation plant run on Liquefied Natural Gas (LNG).
The EFL filed its fundamental rights petition in the Supreme Court on 31 May 2016.
Respondents in the case included the CEB, the Central Environmental Authority and the Ministry of Power and Energy. According to the fundamental rights petition, EFL grievances were on the basis of discrepancies in the Environmental Impact Assessment as well as the long-term environmental and health impacts that a coal power plant would invariably cause. The focus of the legal action was the unsuitability of coal in terms of health, highlighting the impacts already felt in Norochcholai and the economic benefit of coal vis-à-vis LNG.
In his submissions to court in July 2016, Kanag-Isvaran PC said that residents in the Norochcholai area were already suffering from illnesses due to coal dust and fumes from the Lakvijaya plant. He also submitted to court that if coal was used to generate power in Sampur, the seawater required annually to cool the proposed plant would be equal to the volume of water in the Randenigala Reservoir.
EFL’s legal team was led by Kanag-Isvaran PC and environmental lawyer Wardani Karunaratne. The case was taken up before a Supreme Court bench comprising Chief Justice K. Sripavan and Justice Priyantha Jayawardane.