Fuel Switch

Dec 09, 2010 (LBO) – Sri Lanka is looking closely at using liquefied natural gas (LNG) for power generation and transport, according to a note by the island’s petroleum and power ministries.

LNG is cheaper than diesel and LPG and also cleaner, producing less harmful emissions, and its high purity results in higher thermal efficiency reducing generating cost, the statement said. The move aims to reduce the use of more expensive petroleum products whose prices are rising.

The entire thermal energy generation of the state power utility, Ceylon Electricity Board, depends on liquid petroleum as fuel at the moment.

The note said 35 percent of the thermal generating capacity uses the most expensive form of the liquid fuel, auto diesel.

A total annual savings of 572 million US dollars is estimated from the switch to LNG, with over half coming from electricity generation, the document said.

The use of LNG as a fuel is not in the CEB’s long-term power generation plan, which has recommended the cheapest option, coal.

A steering committee of senior government officials is to be appointed to oversee the switch and the petroleum industries ministry is to arrange for long-ter