United NationsDepartment of Economic and Social Affairs Sustainable Development

Sri Lanka

Sri Lanka - Country Statement CSD 14
Sri Lanka?s current economic development policy framework (Mahinda Chintana) is a
consolidation of Pro-poor growth strategies based on private and public sector
participation in economic and social development. The policy framework is developed on
a market friendly, export oriented and competitiveness basis to sustain eight (8) percent
economic growth in the GDP during the medium term. The Millenium Development
Goals are also incorporated in the economic development policy framework.
Energy security has become an important factor in achieving the objectives articulated in
the economic policy framework. Supply of reliable, affordable and clean energy during
the medium term for industries, individuals and othe r sectors are extremely important in
this regard.
The industry sector has contributed 27 percent to the GDP in 2005 while the services
sector contributed 59 percent. The agriculture sector contribution was 14 percent showing
a declining trend compare to previous years. Of the industry sector manufacturing,
factory, industries, and construction are the major contributing areas. With regards to the
services sector trade, hotels, restaurant and transport are the major ones. Energy is a key
input in all of these sectors.
Biomass, hydropower, and thermal power (fossil fuels), are the conventional energy
sources in supplying energy. The utilization of renewable resources such as solar, wind,
dendro, and mini-hydro are relatively small. The transport sector ent irely utilizes energy
sources such as gasoline and the diesel.
The steep rise in the oil prices in the recent past has resulted a great burden to the
economy in supplying of these conventional energy sources without fluctuations. The
absence of petroleum resources deposits in the country has aggravated the situation. This
has created to explore avenues immediately to ease the energy problem. The available
options are the utilization of renewable energy sources and efficiency improvement in the
current use. The renewable resources are also important in reducing air pollution,
mitigating adverse climate effects and the provision of clean energy.
The improvement in efficiency in energy resource is also useful to ease the problem.
Several measures such as reducing system losses, use of low energy consuming
equipment, saving energy through changing behaviors, etc. have been introduced and
used at present.
Following table shows the theoretical potential of renewable energy sources in Sri Lanka.
Table 1.1 Theoretical Potential of the Renewable Energy Resources
Type of the Energy Source Estimated Quantity (KTOE/year)
Biomass 16,000
Hydro power 360
Solar power 8600,000
Wind Power 3440
The solar power is the largest renewable energy source in terms of quantity and also
useful in providing electrification in rural people in remote areas. The provision of
electricity from the national grid is not possible due to capacity limits and cost
effectiveness. The utilization of large hydropower projects has been limited due to the
carrying capacity limits and absence of hydropower sources. The future hydropower
expansion will be therefore mainly composed of introducing mini hydropower schemes.
The wind power is also a useful energy source in providing energy supply to the national
grid in future.
The Dendro power has become increasingly popular among the renewable energy sources
at present. It utilizes wood (biomass) to generate electricity. The cultivation of fuel wood
species in marginal/uneconomic lands will generate employment opportunities as well as
additional income to the rural population which in turn address the rural poverty. The
direct output of Dendro power is the supply of electricity which ease the energy problem.
The Present Situation and Constraints
The efficient use of energy has been a priority area and the World Bank assisted
renewable energy programme will provide further development of renewable energy
sources. The use of solar power at present is far below its potential.
The high price of purchasing photovolatic cells has become a constraint. The
unavailability of adequate financial resources therefore is the major constraint in the
expansion of solar power utilization. The power generated from the solar power is not
strong as from the national grid. Therefore, a technological improvement plays a key role
in popularising the use of solar power. The number of local companies/entities involves
in establishing solar power units also a few and need to be expanded.
With regards to wind power the initial establishment cost are high. Some institutional
problems such as land acquisition in suitable areas to establish wind power plants have
been observed. Many of the wind power potential areas are located far from the
transmission lines.
The markets of the renewable energy sources are ill-developed (thin markets).
The Dendro power is becoming more and more popular but the utlilization at present is
sub-optimal. The awareness programmes, release of marginal lands for fuel wood
cultivation, and private sector involvement is inadequate.
Sri Lanka has introduced cleaner development mechanism (Waste minimization,
pollution prevention and clean industrial production) is being progressed.
With regards to the implementation of CDM mechanism under the Kyoto Protocol
Climate Change Secretariat has been established and it serves as the national focal point
of the UNFCC activities. It also provides one stop facility to disseminate information
relating to the implementation of the decisions taken at the parties meetings. The
Secretariat promotes research studies on impacts, mitigation, adaptations etc. The draft
policy on CDM has been prepared.
The Clean Air 2007 has been prepared. Development of a coordinating body for all air
quality improvement and management activities with stakeholder partnership, reducing
the emission of harmful and toxic air pollutants through implementation of regulatory
programmes in association of the stakeholders etc. are the major objectives of the
programme. Actions have also been taken to implement the carbon finance mechanism.
The Way Forward
Renewable energy sources can be viewed as the most appropriate solution to mitigate the
energy problem. The operation and maintenance cost are very low with compared to the
conventional energy plants. To accelerate and utilize renewable energy sources following
measures are envisaged.
· Transferring technology to Sri Lanka by developed countries in improving the
utilization of renewable energy sources.
· Providing assistance in research and development in the renewable resources area to
improve the quality and output.
· Providing financial assistance to purchase machinery and equipment and to develop
Co-financing mechanism in the renewable energy sources sector.
· Encouraging private sector for investments in the renewable energy sector.
· Removing institutional, legal and other constraints with regards to the development of
renewable energy sector and incentives to develop the renewable energy market.
· Popularizing the use of renewable energy use through awareness campaigns.