Cabinet granted approval to a memorandum of understanding submitted by the Minister of Power and Energy, W.D.J. Seneviratne for the implementation of rural electrification project with assistance from the Islamic Republic of Iran.

The 10 year Horizon-Development Framework -2006-2016 envisages the expansion of coverage of electricity in the country up to 96% by 2016 of which 88% from grid connected electricity and 8% from off grid connected electricity with the aim of reducing total generation, transmission and distribution losses up to 12% of net generation by 2015. By 2010 it is expected that coverage of electricity in the country increase to 85% to 90%.

The investment of the project is USD 65.8 million.