Sri Lanka may reach out to Adani Green Energy Ltd to understand the factual position on the entities intent to exit the green projects in the island nation. According to sources, the Power and Energy Ministry of Sri Lanka had not heard from the Adani Group company directly but communication to Board of Investment was shared with them.
Meanwhile, recently the new Cabinet of Sri Lanka has given its nod to constitute a committee that will take up the contentious issue of tariff. According to sources, the tariff which Sri Lanka was looking at was around 6 cents a unit.
There is also a fear among the Sri Lankan business fraternity that if large projects get called off it will send wrong signals to the investors confidence.
A letter from Adani Green dated February 12 addressed to Arjuna Herath Chairman Board of Investment Colombo, Sri Lanka, has created this uncertainty on the future of the projects. The letter said that Adani Green has been under protracted discussions with Ceylon Electricity Board and various Government departments since past more than two years, in respect of establishing 484 MW Renewable Energy Wind Farms at Mannar and Pooneryn, Sri Lanka, along with its associated Transmission system, as also additional 220 KV and 400 KV Transmission network expansion to carry electrons to consumptive centers in the southern part of Sri Lanka.
These projects, according to the letter, were to collectively see investments of about $ 1 billion in Sri Lanka, based on build own operate concept. “In pursuit of said proposal, Adani Green teams had several rounds of discussions with state appointed committees and after more than 14 rounds of discussions, approval was accorded on Tariff, fixed for 20 years, for the Power Purchase Agreement,” the letter said.
Adani Green also worked on all clearances and licenses, it said adding that “With the exception of Mannar Environmental approval and an associated Supreme Court case, we have procured almost all clearances. Similarly, we have worked on lands for the project, as well as associated transmission system. Till date, the company has spent about $ 5 million on the pre-development activities,” it said.
$ 5 million claim
However, industry experts in Sri Lanka are questioning the $ 5 million claim. According to them “Not sure about the $ 5 million, as there is no such expense till the energy permit is given. The environment impact assessment would cost about $ 40,000.”
According to sources, the procedure for issuing a power purchase agreement for large projects is – Application, Provisional approval by a committee of government officials, Environment Impact Assessment, Letter of Intent from Ceylon Electricity Board, Energy Permit and Power Purchase Agreement.
Meanwhile, sources in know of the developments in Adani Green said that the Indian major has not heard anything as yet from Sri Lanka and they are open for any discussion.
