Cabinet Spokesperson Mangala Samaraweera said Thursday that Cabinet approval for an electricity tariff hike was deferred, after no agreement was reached on how much.
“Cabinet didn’t want tariffs for the first 90 units to be raised, but the Ceylon Electricity Board wanted a flat increase. It will be taken up again in about two weeks,” Samaraweera said.
The Ceylon Electricity Board (CEB) has been recommending about a 23 percent hike to cover the cost of subsidised tariffs, but after political considerations, a five percent hike has been on the cards.
Translated, that works out to just an added 38 cents on a unit, "which is nothing and not enough to cover any costs," a senior official at the CEB said.
The Cost of production of a unit of thermal power is in the region of Rs. 10.00, supplied to domestic customers at Rs. 7.70 a unit. Industrial and commercial rates are not subsidised.
"The CEB is losing Rs. 2.00 on every unit supplied. A tariff increase of about 22 to 23 percent is need