Déjà vu

Operating losses at the Ceylon Electricity Board is threatening to snowball to Rs. 18 billion by year end, as costs of generation soar with no new power plants in sight. Operating losses at the Ceylon Electricity Board is threatening to snowball to Rs. 18 billion by year end, as costs of generation soar with no new power plants in sight.

The state monopoly power utility has notched up a Rs. 13.5 bn operating loss for the first nine months this year, but that could exceed Rs. 18 bn by year end, senior officials with the CEB said.

Total operating losses hit Rs. 15 bn last year, but use of more thermal power coupled with high oil prices and no change in electricity tariffs is blowing holes in its balance sheet.

The CEB generates 24 million units of electricity a day and since June this year, about two thirds of that has been from expensive diesels, both the CEB’s and from Independent Power Producers.

“The average cost of electricity generation was Rs. 9.52 per unit, while the average tariff was Rs. 7.70 per unit during the first eight months of 2005,” the Central Bank said in its Economic Highlights and Outlook for 2006, released on Tuesday.

Attem