Tuesday, 16 July 2013

Two gas turbines to CEB for USD $ 60 million despite a controversy

The Ceylon Electricity Board (CEB) has decided to  set up two gas turbines to produce 400 megawatts (MW) of electricity. The estimated cost for the project is USD $ 60 million. The 200 MW first turbine is  scheduled to be commissioned in 2015 and the second one  in 2017.

However, an engineer questioned why the CEB should taken steps for such turbines, when agreements with other power plants like the Puttalam Heladanvi 100 MW–the cheapest plant in the system–and the 100 MW Embilipitiya, though currently producing only 70 MW, could be extended. "The contracts for both those plants expire at the end of 2014. Why on earth should the CEB go for gas turbines paying a staggering sum, when a unit of electricity produced by them will cost between Rs. 6.00 and Rs. 7.00 per unit more than that produced by Embilipitiya and Helandanvi apart from their construction cost?.

Meanwhile, some experts are of the view that the CEB should renew contracts to get 75 MW from the Lakdanavi, Sapugaskanda and ASCE plants (in Horana and Matara) all three contributing 25 MW each. Though the CEB could now manage due to water in reservoirs being at spill level, the 75 MW would be crucial for the national grid during a crunch situation, officials of the CEB’s System Control Division said. Officials of the CEB, while agreeing that the three plants run with heavy sulphur oil, which is the cheapest when compared with other combined cycle plants, said renegotiating with the Independent Power Producers (IPPs) was crucial and the regulatory body, the Public Utilities Commission of Sri Lanka (PUCSL) should spell out the methodology.

Energy expert, Dr. Anil Cabraal, who is currently a Director of Energy Forum, after serving more the 15 years with the World Bank, pointed out at the 2013 Economic Summit, which concluded last week, that he did not see many benefits from gas turbines.