The energy sector is strongly correlated with all other sectors of the economy including production, commercial and services. Therefore, energy planning has to always be made in a sustainable manner, within the framework of current and future energy demand against available energy resources.

While ensuring a continuous supply of electricity, managing a strategic balance between indigenous energy resources and imported fossil fuels and coal is a major challenge faced by the Sri Lanka’s power sector. Ceylon Electricity Board has an ambitious capital investment plan for next 10 years to maintain 100% electrification while improving supply quality and reliability.
In this background, it is expected to implement the tranche 2 of the Green Power Development and Energy Efficiency Improvement Investment Program which will include three major components; i.e. (i) Transmission infrastructure enhancement; (ii) Efficiency improvement of medium voltage network and (iii) demand side management improvent for energy efficiency through development of a smart grid and metering pilot subproject. AFD has already provided financing of Euro 22 million for the implementation of Tranche 1 of the Programme.
Total cost of this project is estimated at US$ 260 million. Asian Development Bank has already provided USD 150 million loan to finance a part of the project. French Agency for Development (AFD) will provide Euro 30 million loan to finance a part of the total project cost and the balance will be borne by the Ceylon Electricity Board.
In this connection, Dr. R H S Samaratunga, Secretary of the Ministry of Finance and Mass Media on behalf of the Government of Sri Lanka and Mr Martin Parent, Country Director of AFD Sri Lanka Resident Mission on behalf of AFD, signed a Credit Facility Agreement relevant to the above loan on 17th October 2018 at the Ministry of Finance and Mass Media.