government orders closure of PUCSL

• Says move based on a budget proposal to reform laws of PUCSL and CEB
• CEB and Consumer Affairs Authority expected to perform key objectives of PUCSL

In an unexpected move, the government has decided to shut down the Public Utilities Commission of Sri Lanka (PUCSL) based on a budget proposal to reform the laws governing the country’s power sector regulator and the utility, the Ceylon Electricity Board (CEB), according to 
informed sources. In a letter dated December 1, 2020, Secretary to President Dr. P.B Jayasundara instructed Finance Ministry Secretary S.R. Attygalle to move ahead with the necessary procedural steps to close the PUCSL and take steps to absorb the technical staff to the National Planning Department and also deploy such staff to the 
Power Ministry.

The PUCSL was established by the Public Utilities Commission of Sri Lanka Act No. 35 of 2002 and operated as the economic, technical and safety regulator of the electricity industry, with powers vested by the Sri Lanka Electricity Act No. 20 of 2009.

Jayasundara in his letter stated that the Public Utilities Commission of Sri Lanka Act would be replaced in due course and certain relevant provisions in the act could be incorporated in the Consumer Affairs Authority Act and Ceylon Electricity Board Act.

In a Twitter message, Opposition MP Harsha de Silva yesterday lamented the decision to disband the PUCSL while alleging that the CEB and private power producers are behind the move.

Some power sector experts expressed reservation over the ability of the CEB and Consumer Affairs Authority in performing the key objectives of the PUCSL, which includes ensuring quality, service and fair competition in the industry as well as the monitoring role.

Further, they warned that the move could also potentially impact the funding by key multilateral organisations such as the Asian Development Bank and World Bank in the country’s power sector in the absence of an independent regulatory body.

The PUCSL is also the designated regulator for petroleum and water services industries and has also been assigned as the shadow regulator for the lubricant market in Sri Lanka.

A tug of war was seen brewing between the PUCSL and CEB during last few years over the long-term power generation plan for Sri Lanka, with the regulator favouring liquefied natural gas (LNG) and renewable energy sources over coal.