The Ceylon Electricity Board (CEB) is considering a 25 to 35 percent electricity tariff increase, with the International Monetary Fund (IMF) urging Sri Lanka to implement revised rates.
CEB sources confirmed that the proposed hikes align with a pricing formula agreed upon by the CEB and the Public Utilities Commission of Sri Lanka (PUCSL).
The new rates will require PUCSL approval before implementation.
Amid ongoing discussions, CEB Chairman Tilak Siyambalapitiya has resigned, reportedly due to political and regulatory interference in setting cost-reflective tariffs. Earlier this year, the PUCSL approved a 20 percent tariff reduction against the CEB’s advice, leading to renewed financial losses.
A senior CEB official revealed that after January’s reduction, losses began rising again.
In 2023 and 2024, tariff hikes had helped the CEB post profits of Rs. 61 billion and Rs. 141 billion, respectively, reducing accumulated losses from Rs. 473 billion to Rs. 271 billion. However, losses have climbed since February.
The IMF had set two key conditions: cost-reflective pricing and an automatic 10 percent hike if monthly cash flow falls below Rs. 15 billion.
The official noted that without January’s reduction, a 5 percent increase would have been needed in Q2.
The IMF has warned Sri Lanka twice in recent weeks for breaching cost-recovery benchmarks, raising fiscal risks.
A scheduled April tariff revision was skipped, with authorities offering unclear explanations.
The proposed hike aims to stabilize CEB’s finances while meeting IMF demands for sustainable energy pricing.
