FINANCIAL CHRONICLE – Sri Lanka’s Energy Minister, Aruna Karunathilaka, announced in parliament that the government plans to completely settle the nearly 15 billion rupees owed to renewable energy developers by the end of June.
Karunathilaka highlighted that the National System Operator (NSO) has expedited the payment process, having already disbursed 2 billion rupees on May 19, with an additional 1 billion rupees expected to be paid to renewable energy facilities in the coming week.
The delay in payments has significantly impacted 386 renewable energy developers across the nation.
Earlier this month, the Federation of Renewable Energy Developers (FRED) cautioned that the local sector was on the verge of collapse due to the lack of payments. They noted that the stoppage of payments from the NSO since December 2025 has led to a surge in unpaid dues for small and medium-sized developers, putting 389 energy plants at risk of operational shutdown.
In response to criticism, Karunathilaka stated that the government has not been intentionally delaying payments to support the more costly fossil fuel-based thermal power. “The government does not prioritize thermal power supply; our main focus is on ensuring stability,” he asserted.
Karunathilaka further explained that the NSO’s top priority has been to maintain a consistent electricity supply amidst soaring demand, rising fuel prices, and challenging hydro conditions.
Data shared by the minister indicated that major hydro power remains the most economical energy source, averaging 2.05 rupees per unit. This is followed by mini-hydro at 14.67 rupees, wind energy at 17.40 rupees, and solar power, whether rooftop or ground-mounted, at 25.13 rupees per unit.
In contrast, the anticipated average unit cost for thermal power generation is projected to reach 31.99 rupees per unit in the third quarter of 2026. Karunathilaka emphasized the need for strict cash flow management to ensure a reliable fuel supply for thermal plants, which is essential to avoid widespread blackouts during periods of drought and high demand.
