ADB grants $ 200 million to Sri Lanka to develop 100 MW wind park to boost renewable energy

Oct 24, Manila: The Asian Development Bank's (ADB) Board of Directors has approved a loan of $200 million with sovereign guarantee for Ceylon Electricity Board to develop Sri Lanka's first 100-megawatt wind park, the Asian lender said today.

The Ceylon Electricity Board will provide $56.7 million toward the total project cost of $256.7 million. The estimated completion date for the project is the end of 2021.

“The new Wind Power Generation Project will not only provide access to a clean and reliable power supply in Sri Lanka, but also create an environment for further wind power development through future public-private partnerships,” said Mukhtor Khamudkhanov, an ADB Principal Energy Specialist. “Diversifying the country's power generation through clean, renewable energy sources will improve the country's energy security and environment.”

Sri Lanka boosted its national electrification from 29% in 1990 to more than 99% in 2016. Yet the power sector continues to struggle to meet the growing demand for an affordable and reliable electricity supply.

With the share of thermal (coal and oil-fired) power still accounting for two-thirds of power generation in 2016, there is an urgent need to develop clean energy sources such as wind and solar energy, reduce losses in the system, and boost energy efficiency.

While the remaining third of total generated power in 2016 was from renewable sources, most of this was accounted for by large hydropower facilities. Only about 8% comes from nonconventional renewable energy sources such as mini hydro, wind, solar, and biomass. The country's goal is to increase the share of these nonconventional renewable energy sources to about 20% of the total generated power by 2020.

Besides the wind farm, to be constructed on Mannar Island in Northern Province, the project will provide the associated infrastructure, such as internal cabling and access roads, energy dispatch control center, and reactors to manage voltage levels.

More generally, the project will also establish the procedures to enable the Ceylon Electricity Board-the executing and implementing agency for the project-to act as a wind park developer that can attract the private sector in future wind power generation. These include establishing cost benchmarks and conducting competitive bidding for future wind power projects, and managing the flow of intermittent wind energy through the power system.