The two major thrust areas entrusted with the Sri Lanka Sustainable Energy Authority are energy conservation and renewable energy. Among other
major barriers for projects in these two areas, lack of funding
has been a major obstacle for achieving targets in these two
areas. Through the programme of Fund Management, it has been
targeted to develop facilitation mechanisms for funding energy
conservation and renewable energy projects. Three such programmes
have already been initiated which are described below.
Sustainable
Guarantee Facility (SGF)
In spite of
the fact that energy efficiency services sector of the
country has completed more than 20 years, and also energy
audit programmes are being conducted by the state and
private sector to a considerable extent, implementation
of energy conservation projects is not at a satisfactory
level. The difficulty faced in mobilization of funds
is a major problem here and the Sustainable Guarantee
Facility initiated by the Sri Lanka Sustainable Energy Authority was
targeted at addressing the above issue. It was introduced
at policy level through a Cabinet Memorandum in the
year 2004 and after that a comprehensive mechanism was
developed through a series of meetings of the relevant
stakeholders, namely participating financial institutes,
energy services companies, Sri Lanka Sustainable Energy Authority
and the consultants of USAID, who provided technical
assistance for developing the mechanism. This came into
being with the official launch of the Sustainable Guarantee
Facility by the Minister of Power & Energy on 30th June
2005. A 3-day workshop covering all the relevant technical
and financial aspects was held from 1st to 3rd December
2005 and project proposals were expected from energy
services companies by 31st December 2005. It has been
planned to carry out facilitation for the first 3 to
5 projects in the first quarter of the year 2006.
The goal of the SGF mechanism is to improve the end-use
energy utilization efficiency in bulk energy consumers
and thereby, to reduce the wastage in the respective
sectors.
Energy
Conservation & Efficiency Improvement (ECEI) Project
Sri Lanka Sustainable Energy Authority took measures for absorbing funds for energy conservation
projects from international donor agencies. A comprehensive
study was carried out in the year 2004 with the technical
assistance of Japanese Bank for International Cooperation
(JBIC). Consequently, yen loan from JBIC and technical
assistance from JICA for capacity building was sought.
Preliminary work in line with this and also for setting
up a Project Management Unit (PMU) was carried out in
the year 2005. Financial assistance is expected in the
year 2006 supporting bulk energy users to find necessary
fund for investments in energy conservation projects.
Sri
Lanka Energy Fund
Facilitation
of renewable energy based power generation projects is
very important, especially at the initial phase of such
projects, to add to capacity in the country. Sri Lanka Sustainable Energy Authority took initiatives to develop a funding scheme with
a view to grant production subsidies and meeting ancillary
costs of renewable energy projects. As the first step,
payment of a subsidy for dendro based power generation
was expected and preliminary work in line with that was
carried out through deliberations with the Treasury and
other related agencies. Establishment of this funding
scheme is expected in early part of year 2006.
