Adani Wind Power Project to become Sri Lanka’s lowest power tariff to benefit citizens
Ada Derana: Adani’s wind power tariff of 24.78 LKR per unit is the lowest in the country, cheaper than the CEB’s 100 MW Wind power plant at Thambapavani and significantly lower than oil-based power at 80 LKR per unit.
By replacing higher-cost, import-dependent fossil fuel power, Adani’s project will save Sri Lanka over US$ 270 million annually in foreign exchange, potentially up to US$ 5.4 billion over the project’s lifetime.
Adani’s project, with a tariff of 24.78 LKR per unit, is notably lower than the tariffs of other renewable energy projects recently approved, and significantly cheaper than fossil fuel-based power generation.
Generating about 1,500 million units of green power annually, the project will meet the energy needs of 590,000 households and help Sri Lanka achieve its Renewable Energy Target of 70% by 2030. This green energy production will avoid 1.06 million tons of CO2 emissions annually, offering an economic benefit of up to US$ 100 million per year.
Targeted for completion by 2025, the project will reduce the government’s electricity purchase costs by approximately US$ 83 million per year (about LKR 25 billion), leading to a reduction in consumer electricity tariffs by 17 LKR per unit.
OSL take:
Sri Lanka’s ongoing economic expansion and the target of becoming a hub in the South Asian region have resulted in the growth of the power industry due to the increasing demand. With the Sri Lankan government’s policy to increase renewable energy generated power to 70% of the country’s total power mix, there’s a growth in business/investment opportunities in Sri Lanka’s renewable energy generation sector. These opportunities range from direct to indirect opportunities. The growth and business potential in Sri Lanka’s renewable energy generation sector has attracted large-scale foreign businesses like India’s Adani Green Energy. Also, the profits recorded by local businesses engaged in the renewable energy generation sector are also indicative of the lucrative nature of investments in the sector. Given Sri Lanka’s growth path, foreign businesses/investors could confidently explore the expanding business/investment opportunities in Sri Lanka’s renewable energy generation sector. Foreign businesses could also look at forming joint ventures or partnerships with local businesses engaged in the renewable energy generation sector with the aim of expanding businesses.