CPC blames CEB for oil price hike

The Ceylon Petroleum Corporation (CPC) today blamed the Ceylon Electricity Board (CEB) for the recent hike in fuel prices and said it could no longer sustain the high cost involved in the supply of fuel for thermal power generation.

The CPC increased the price of diesel by Rs.8 a litre, petrol by Rs.12 and kerosene by Rs.10 from Sunday.

It said the price increase was imposed as a means of recovering at least a certain percentage of the losses in the supply of fuel to the CEB at subsidised rates.

CPC Chairman Harry Jayawardane said the government continued to control fuel prices in the local market despite increases in the world market.

He said the government had to depend more on thermal power for electricity generation because the capacity for hydroelectric generation had dropped drastically after the prolonged dry spell. He said the fuel prices were surging in the world market due to the crisis in Europe and the Middle-East. When asked to comment on this matter, Power and Energy Minister Patali Champika Ranawaka said the CEB had passed down the fuel price concessions given by the CPC to the industrial and public sectors by supplying electricity at lower rates.

Minister Ranawaka said electricity is sold to the export-oriented industrial sector at Rs.8 a unit despite generation costs being as high as Rs.13 a unit. He said that the public sector was also given electricity at concessionary rates.

“We give concessions to consumers who use less than 90 units a month. We charge only 60 percent of the cost from such consumers. If we are given fuel at subsidised rates, we have passed down the benefits to the industrial and public sectors. Other than that we have not got the benefit,” he said. (KB)