At present, it is estimated that 77% of the households have electricity with grid connections whilst 3% are served by off-grid facilities. The annual increase in demand for electricity is around 7%-8%. Therefore, around 200MW needs to be added to the system annually.

Electricity generation in Sri Lanka depends heavily on crude oil. Thus, the power generation cost has increased. In order to overcome this situation, low cost electricity generating facilities, such as coal and hydro electric power plants are being constructed.

As mentioned in 'Mahinda Chintana', President Mahinda Rajapaksa has given high priority to energy security and energy conservation in the country.

Upper Kotmale hydropower project

This project was delayed due to various reasons under several governments until the present government took a firm decision to commence the project in 2006.

It is expected to add 409 GWh to the national grid annually and help meet the future electricity demand of the country. The (UK) dam will be located near Talawakele and an underground powerhouse at Niyagammodara. These will be linked by a tunnel. The project area covers around 540 square kms of the upstream catchment of the Kotmale Oya. The total estimated cost of the project is Rs. 38,219 million. It is expected to be completed by December 2010.

This project will save foreign exchange that is currently utilized for importing diesel for thermal power generation. The Ceylon Electricity Board (CEB) spends approximately Rs. 16,000 million on importing diesel for power generation. A considerable portion of this expenditure can be saved as a result of the Upper Kotmale hydropower project. It is also expected to provide direct and indirect employment and income earning opportunities to many unemployed persons during its construction period.

The electricity generated by this power plant can be utilized to better serve the demands of the Industrial Sector. A reliable and efficient power supply will ensure safety for investors who hope to invest in industrial development projects. This in turn will lead to development of the Industrial Sector in the country.

The power from this project will be useful to provide electricity to regions where electricity supply is currently not available. At present 20% of the total households in the country does not have access to electricity. A part of this population will receive electricity through this project.

The contract for preparatory work between CEB and Maeda Corporation, Japan was signed in July 2005. Under this, access roads and permanent facilities for re-settlers are in progress. The construction of permanent facilities for employees and engineers is complete. Two 33 KV transmission lines have also been completed, while laying concrete for the intake dam and river bank protection work are in progress.

In addition, the excavations for the access tunnel and cable tunnel have been completed, as well as the coffer dam in the outlet area is also completed, while the excavation of lower inclined penstock pilot tunnel is in progress. The construction of 220 Kv transmission line is also in progress.

Kerawalapitiya Thermal Power Plant

Adding another power source to the national grid, the Kerawalapitiya Thermal Power Plant was opened in December 2008 by President Mahinda Rajapaksa.

The 200 megawatt power plant, built at a cost of US$ 300 million, expanded production to 300 megawatts within a year, and also promotes socio- economic development in Kerawalapitiya and neighbouring towns.

Development and Improvement of Transmission Systems

The implementation of transmission development activities is expected to ensure a reliable power supply and reduce transmission losses of the national grid. The key components of the project are the construction of Katunayake Grid Sub-Station, improvement of the Valachchenai Transmission Project, augmentation of Colombo A Grid Sub-Station, augmentation of Colombo 1 Grid Sub-Station, installation of 220Kv/132 Kv inter-bus transformer at Rantembe PS and the installation of the 3rd 220/132 Kv inter-bus transformer at Biyagama.

Under this project the electrification level of the country increases with the expansion of the existing power distribution capacity and improvement of transmission facilities. It reduces transmission and distribution losses from 15.5% to 12% of net generation, and save an additional capacity of electricity which is equal to 360Gwh annually. These improved transmission facilities provide opportunities to connect renewable energy power plants to the national grid. This will encourage private investors who will positively contribute towards developing the renewable energy sector of the country. It will also improve the provision of power supply to the industrial sector, which will in turn attract investments.

Norochcholai Coal Fired Power Plant

Sri Lanka is expected to give a major boost to its power sector with the completion of the Norochcholai coal power project.

The first phase of the construction was completed in 2009 while the second and third phases of the project, aimed at generating over 600MW will commence soon with financial assistance from the Chinese Government.

300 MW is added to the national grid with the completion of the first stage and 600 MW will be added in the second and third stages. The project is expected to make a significant contribution towards meeting the country's electricity needs by 2015. The cost of power generation from coal fired power plants is relatively low compared to oil fired power plants. Thus, this project will result in saving a considerable amount of foreign exchange and reduction in the cost of power generation.

The project is expected to contribute towards the expansion of the industrial sector as well as other development sectors. It will thus contribute to increased employment as well as income generation opportunities. The tariff for electricity can be reduced due to cost effective power generation.

Trincomalee Coal Fired Power Plant

This project aims to construct a 500 MW power plant in Trincomalee, in the East in order to generate electricity at a low cost for the national grid.

The cost of power generation from this plant is relatively low compared to other oil fired power plants. Therefore, those benefits can be transferred to its consumers. The low cost of electricity and reduced cost of power generation will meet the increased demand for electricity. The generated electricity of this power plant can also be utilized to meet the demand of the Industrial Sector. A reliable and efficient power supply is a precondition for the present development process.

The project will consist two phases and the first phase is expected to be completed by 2012.


Through these projects the government expects to provide electricity to the entire nation especially rural areas to uplift the living standards of the people. These projects will no doubt speed up the development process as well so that all communities, irrespective of ethnicity, class, religion or region will reap its benefits.