The Asian Development Bank (ADB) has approved a $300m dual-tranche loan to help Sri Lanka boost increase its use of clean energy while reducing reliance on costly petroleum oil for electricity generation.
ADB principal energy specialist Mukhtor Khamudkhanov said the heavy dependence of the country on expensive imported petroleum oil hurts the economy, undermines energy security, and harms the environment.
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"This loan will help Sri Lanka expand the use of renewable energy for power generation and have major benefits both for poor communities and the broader economy," Khamudkhanov added.
Sri Lank will use the trench of $150m to finance a 30MW, run-of-the-river hydropower plant at Moragolla in Central Province as well as to expand and upgrade transmission lines and other infrastructure in needy areas, including the former conflict-affected Northern and Eastern Provinces.
Capable of generating an additional 97.7 million units of hydropower for the grid, the hydropower plant will save about 72,300 tons of carbon dioxide (CO2) emissions every year while improved transmission lines will further reduce annual CO2 emissions by 98,400t.
Salted to be delivered in 2016, the second tranche will be used for expanding the 33 kilovolt medium voltage network to improve distribution of electricity to consumers.
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By GlobalDataThe second trench amount will also be used for the development of transmission network facilities to allow power delivery from two 100MW wind parks due to be built in the Northern Province in 2017 and 2020.
Additionally, assistance will be given for demand-side energy efficiency improvements such as the use of smart grid and metering technologies, the retrofitting of buildings with energy saving features, and the installation of cold thermal storage in selected buildings.
The program will also support wider energy investment road map of Sri Lanka which include its plan to increase the share of grid power generated from nonconventional renewable energy sources, such as mini-hydropower, wind power, and solar power, to 20% of the total by 2020.
