Policy coherence between climate risk mitigation and energy sectors in Sri Lanka - Key highlights an

Developed by: A.M.Aslam Saja, Minuri Perera, Aravinda Bellanthudawa

Climate Action Champions Network (CACN) - Sri Lanka Cohort Members

Energy sector overview in Sri Lanka

The energy sector in Sri Lanka presents a diverse landscape with various facets that shape its operations and policies. A notable entity in this sector is the Ceylon Electricity Board (CEB), which has historically provided comprehensive data on the energy sources and mix used in the country's electricity generation. This data has been crucial for understanding the energy landscape up to 2022. Besides, electricity, the Sustainable Energy Authority plays a pivotal role in capturing data on petroleum imports and usage within Sri Lanka. The authority also provides insights into the energy balance, which encompasses allocations to the transport, industrial, and primarily the power generation sectors. This holistic approach to data collection helps in understanding the energy consumption patterns across different sectors of the economy.

In Sri Lanka, the agricultural industry stands out as a significant consumer and producer of energy sources. The sector consumes considerable amounts of energy while also contributing to the production of various energy sources. This interplay between agriculture and energy underscores the importance of considering all sectors when formulating energy policies. A critical aspect often overlooked is the substantial usage of non-electrical energy in industries across Sri Lanka. While electricity plays a vital role, it forms a smaller percentage of the overall energy mix. This highlights the need to address non-electrical energy consumption to comprehensively tackle the country's energy challenges.

When discussing energy, the focus tends to gravitate towards electricity, yet thermal energy plays a crucial role, particularly in industries. Industries in Sri Lanka utilize a significant amount of thermal energy alongside electricity. This dual usage underscores the importance of a multi-faceted approach to energy policy. Transportation emerges as one of the largest energy consumers in Sri Lanka, alongside electricity. The nation relies on various fuel sources such as diesel and petrol for transportation needs. The discussion on energy in Sri Lanka is incomplete without considering the energy requirements of transportation, both motorized and non-motorized.

In addition to transportation, electricity plays a pivotal role in various sectors, including residential, commercial, and agricultural. From lighting to powering household appliances, electricity is integral to everyday life. The services sector primarily relies on electricity, while industries often utilize a mix of energy sources, including electricity and others. It is clear that the Sri Lanka's energy sector is multifaceted, encompassing electricity, thermal energy, and various fuel sources. Understanding the energy consumption patterns across sectors such as agriculture, industry, transport, and services is crucial for formulating effective energy policies. As the country continues its efforts towards sustainability and energy security, a comprehensive approach that addresses all facets of energy usage remains essential.

Energy utilization and potential technologies in Sri Lanka

The energy landscape of Sri Lanka showcases a blend of renewable and thermal power sources, with a focus on harnessing renewable energy to meet the country's energy needs. Renewable sources, particularly large hydro plants, contribute significantly to the energy production in Sri Lanka. However, during dry seasons, the reliance on hydro power decreases, leading to an increased dependence on thermal energy sources.

Thermal energy sources, primarily coal power and heavy fuels like diesel, play a crucial role in meeting the country's energy demands when renewable sources are insufficient. Interestingly, the daily cost of energy production is significantly lower when relying mostly on renewable sources, highlighting the economic advantages of such a strategy. Conversely, a shift towards increased use of thermal energy could triple the daily costs of energy production. Hydroelectric power stands out as a major player in the renewable energy sector, providing approximately half of the renewable energy in Sri Lanka. The remaining share comes from sources such as wind, solar, and solid waste. Wind energy, in particular, shows considerable potential for further development, with both private companies and the Ceylon Electricity Board (CEB) actively involved in its expansion. Solar energy also holds significant promise for future development, with initiatives focusing on solar farms and rooftops for net metering.

In terms of other energy sources, Sri Lanka also utilizes diesel generators and has a coal power plant. The country is exploring the potential of nuclear power, albeit on a smaller scale, with researchers studying its feasibility. The concept of "energy stacking" is gaining traction in Sri Lanka, emphasizing the use of multiple energy sources such as biomass, LP gas, biogas, and electricity to meet energy needs. This approach is particularly beneficial when local energy resources are available. Additionally, there is a growing emphasis on improving indoor air quality, with initiatives such as the introduction of better cook stoves meeting national standards. However, there is room for further improvements, such as the adoption of wood gasifier stoves to reduce biomass use and emissions inside homes.

Solar energy has seen notable advancements in Sri Lanka, with solar PV systems introduced for off-grid areas through World Bank projects in the late 1990s. Initially used mainly for lighting, solar rooftops have become popular for net metering. Traditionally, Sri Lankans have utilized solar energy for direct purposes like drying fish, fruits, and clothes. In areas without access to the main grid, micro and mini grids powered by solar or hydro energy have proven successful. The country has a history of electrifying villages through micro hydro schemes, although some of these initiatives were later abandoned after the main electrification efforts. Looking ahead, Sri Lanka's energy sector holds immense potential for further development and innovation, particularly in the expansion of renewable energy sources, the adoption of efficient technologies, and the improvement of energy access for all citizens.

Challenges and opportunities in transitioning to renewable energy sources

When considering the cost-effectiveness of renewable energy sources such as wind and solar power in Sri Lanka, several factors come into play. The country, known for its biodiversity hotspots, faces challenges in finding suitable sites for these energy projects without compromising important habitats. Some argue that the most optimal locations for solar or wind farms might be ecologically sensitive areas, raising concerns about the environmental impact versus the cost-effectiveness of such ventures.

Wind power, for instance, finds potential in places like Kalpitiya and around the Ambewela area. However, the availability of suitable sites for wind farms remains limited, leading to considerations about the ecological effects of their construction. There have been instances, like the proposed wind farm in Wangkale, where the potential disturbance to migratory bird patterns has raised concerns. Due to these limitations, solar power emerges as a prominent option for Sri Lanka's renewable energy ambitions. The country experiences intense sunlight across various regions, making solar energy a feasible and attractive choice. However, challenges exist in terms of the initial costs of solar technology, especially when considering the need to import technology from elsewhere.

The transition to solar power presents a significant challenge, particularly for smaller countries like Sri Lanka. Questions arise about the long-term sustainability of solar panels and their disposal after their lifespan, typically around 30 years. This aspect highlights the need for comprehensive planning and policies to address the lifecycle management of solar technologies. Sustainable energy plays a crucial role in bridging the gap between urban and rural electrification in Sri Lanka. In many rural areas, solar or hydropower solutions are implemented independently from the national grid, ensuring access to electricity. However, the affordability and competitiveness of solar energy, especially in comparison to coal, which still dominates the energy mix, remain pressing concerns.

Looking ahead, the potential of hydrogen power is also considered, with discussions revolving around its cost-effectiveness, technological feasibility, and resource availability. The hope is that if hydrogen power proves cheaper and viable, it could naturally replace other energy sources. Efforts are being made to tap into Sri Lanka's renewable energy potential, with identified areas for wind and solar energy projects. Initiatives such as the Clean Energy Summit organized by the Presidential Secretariat have opened doors for investment from renewable energy companies, both domestically and internationally.

Increasing energy demand and GHG emissions

Sri Lanka, when viewed from a global perspective, presents itself as a relatively low emitter of greenhouse gases (GHGs) on a per capita basis. The country's contribution to the global climate change scenario is notably small due to its modest size and historical reliance on hydroelectricity. The majority of Sri Lanka's energy needs have been met through hydroelectric sources, although challenges have emerged, particularly concerning sedimentation in existing dams and the limited availability of untapped rivers for further hydroelectric projects.

In the process of diversification of energy, Sri Lanka has looked towards solar and wind energy options. Solar energy, in particular, presents a viable solution that requires suitable land but doesn't pose the challenge of adverse impacts on biodiversity. However, selecting appropriate sites for solar and wind farms becomes a significant challenge, often complicated by political considerations and potential social impacts on local residents. Economically, Sri Lanka faces the reality of a shrinking economy, which has led to a decline in power demand. This decline in demand has had a mitigating effect on carbon dioxide production, as the country's power needs are not as high as they were in previous years. Unlike some countries where peak power utilization occurs during the daytime due to industrial and manufacturing activities, Sri Lanka experiences its peaks typically in the evening around 7-8 p.m.

The country is exploring alternatives to its current reliance on thermal oil for energy generation. While thermal oil can be costly and environmentally damaging due to its GHG emissions upon burning, natural gas emerges as a potential solution. Converting existing thermal oil-based power plants to natural gas could reduce emissions by a third and offer more competitive costs. However, the infrastructure for handling natural gas is still underdeveloped in Sri Lanka, requiring it to be transported in liquid form.

Despite these challenges, Sri Lanka recognizes the need to transition towards more sustainable energy sources to reduce its environmental footprint and contribute positively to global efforts against climate change. The government has taken steps to explore renewable energy options and improve energy efficiency while balancing economic considerations and environmental impacts. As the country continues to develop its energy infrastructure, the focus remains on finding the right balance between economic growth, environmental sustainability, and social considerations.

Energy transition supporting climate change mitigation targets

The use of energy for electrical power generation should be reflected in terms of grid emission factor, which will take into account the GHG emission due to climate change. The grid emission factor will vary based on the energy mix for electricity generation. In order to meet the increasing future energy demand, it is important to not only increase the generation but also to increase energy efficiency and energy saving practices. Further, the policy makers need to work on the energy humility aspects to make the behavioral characteristics of energy use. Such interventions need to be reflected in the sustainable consumption and production policies of the country. A clear link should be made to promote sustainable consumption and production goal (SDG 12) with the climate change mitigation targets that are articulated through Sri Lanka’s Nationally Determined Contributions (NDCs). 

Challenges and myths in energy transition:

1. Higher cost of electrical energy production 

Energy transition to achieve the net zero targets by 2050 has been a challenge and it will continue to be a challenge due to slow progress in the policy making. For example the reduction of the cost of electricity production has been the key focus as opposed to the reduction of GHG emission from the electricity generation that will help to mitigate the climate change. There has been not much studies at the national level that determined the benefit to cost ratio of using cheap fossil fuel as opposed to the use of renewable energy source while factoring the loss and damage due to the climate change impact. 

1. Stability and reliability of the energy infrastructure 

One of the key challenges in increasing the renewable energy mix through most abundant renewable energy sources in Sri Lanka such as solar and wind is reported to main a higher stability and reliability of the integrated electrical energy grid network. Since the availability of solar and wind are highly seasonal and time varying, an additional investment in the energy infrastructure is required to maintain the system stability. However, the new technological advancements can overcome this challenge and it will be much more cost effective if the cost of loss and damage due to the climate change impacts using non-renewable traditional energy sources is quantified and compared with the cost of introducing advanced technology to improve the system stability using renewable energy integration. 

1. Promoting waste to energy, biomass and bio gas energy generation projects

If the sustainably sourced biomass can be used in the industry and households to meet their energy requirements, the net effect on the climate change is going to be zero as it is a carbon neutral energy source. The biogas technology at small-scale also has many benefits. 

Further, Sri Lanka can still produce more energy from waste as it has 65-80%% of organic waste in general waste composition. However, due to lack of efficient waste collection mechanisms and the amount of total waste generated throughout the country may not be that significant and economically viable to set up waste to energy power plants. Further this may not contribute significantly to alter the energy mix at national level, although such an initiative can help to solve the waste management problem. 

Structural Integration of Institutions

1. Political Interference and Expert Consultation

1.1 Pledges without Expert Input

Sri Lanka’s energy and climate targets have been pledged without adequate consultation with domain experts. While politicians are well-intentioned, their decisions often lack the technical depth required for informed policy formulation in this complex landscape. Consequently, targets are set forth without considering feasibility, practicality, or the intricate trade-offs involved. The absence of expert input leaves the energy-climate nexus vulnerable to ill-conceived policies that may ultimately hinder progress.

1.2 Politicisation of the Energy Sector

Globally, the energy sector is highly politicized, often leading to extreme social trade-offs in pursuit of short-term financial gains. Sri Lanka is no exception. The government’s reluctance to transition toward greener and more sustainable energy sources stems from a desire to maintain popularity with the masses. As politicians prioritize immediate electoral appeal, long-term environmental concerns take a back seat. This myopic focus perpetuates an unsustainable energy sector, hindering progress toward the ambitious targets.

2. Ministerial Instability and Accountability

2.1 Frequent Ministerial Changes

Sri Lanka grapples with frequent ministerial reshuffles, resulting in ministers who lack familiarity with their assigned portfolios. These transient appointments hinder continuity and prevent sustained efforts toward achieving energy and climate goals. Ministers, often unacquainted with the intricacies of their ministries, fail to provide consistent leadership. Consequently, policy shifts occur without a comprehensive understanding of the sector, exacerbating institutional weaknesses.

2.2 Lack of Accountability

Ministers operate with minimal accountability for their actions. The absence of repercussions encourages errors and prevents corrective measures. When ministers are shielded from consequences, they may prioritize short-term gains over long-term sustainability. This lack of accountability perpetuates inefficiencies and undermines the state’s ability to drive meaningful change.

3. Siloed State Institutes and Coordination Challenges

3.1 Fragmented Approach

State institutes working on the energy-climate nexus often operate in silos. Isolated decision-making prevents holistic planning and obstructs progress. Departments responsible for energy, environment, and climate change rarely collaborate effectively, leading to disjointed efforts. Without coordinated action, achieving the ambitious targets becomes an uphill battle.

3.2 Strengthening Interagency Cooperation

Efforts must focus on breaking down silos and fostering collaboration. Interagency coordination is essential for aligning policies, sharing expertise, and pooling resources. Establishing cross-functional teams and promoting knowledge exchange can bridge gaps and enhance the effectiveness of energy and climate initiatives.

4. Monitoring and Evaluation Deficits

4.1 Inadequate Oversight

Government institutes lack robust monitoring and evaluation mechanisms. Without rigorous assessment, progress remains elusive. External organizations, such as the Asian Development Bank (ADB) and the United Nations Development Programme (UNDP), step in to fill the void left by an inert state mechanism. The state’s role becomes marginalized, rendering it ineffective in driving change.

4.1 Addressing Monitoring Gaps

Investing in monitoring capacity within government agencies is crucial. Regular evaluations ensure transparency, identify bottlenecks, and guide corrective actions. By bolstering monitoring and evaluation capabilities, Sri Lanka can hold itself accountable and make informed adjustments to achieve its energy and climate targets.

 

Recommendations

1. Mainstream Climate Change into Energy Policies

• Integrate Climate Considerations: Energy policies should no longer operate in silos. Crucial elements like climate change must be mainstreamed into decision-making processes. Policymakers, technical experts, and stakeholders should collaborate to ensure that energy strategies align with climate goals.

• Cross-Sectoral Coordination: Establish mechanisms for cross-sectoral coordination. Energy ministries, environmental agencies, and climate bodies should work together to harmonise policies, share data, and jointly address challenges.

• Prioritize Climate Impact Assessments: Before advancing energy policies, conduct rigorous assessments of their climate implications. Evaluate how each policy contributes to emissions reduction, resilience, and adaptation. Transparency in these assessments is crucial.

2. Enhancing Transparency and Accountability

• Accessible Data: Make energy-related information available to the public. Publish data on energy production, consumption, emissions, and renewable sources. User-friendly platforms, such as online dashboards, can enhance transparency.

• Annual Reports: Regularly release comprehensive reports detailing progress toward energy and climate targets. These reports should be accessible to all citizens, researchers, and civil society organizations.

• Public Consultations: Involve citizens in decision-making processes. Seek public input on energy policies, projects, and investments. Public consultations enhance accountability and ensure that diverse perspectives are considered.

• Independent Audits: Conduct independent audits of energy projects and expenditures. External bodies can assess whether funds are allocated efficiently and whether projects align with climate objectives.

3. Capacity Building and Training

• Invest in Training: Strengthen the capacity of energy professionals. Provide training on climate science, renewable technologies, and sustainable practices. Well-informed experts can drive evidence-based policymaking.

• Climate Literacy: Educate policymakers, administrators, and the public about climate change. Foster a deeper understanding of its implications for the energy sector. Climate literacy empowers decision-makers to make informed choices.

4. Monitoring and Evaluation

• Establish Monitoring Mechanisms: Develop robust systems to track progress toward energy and climate goals. Monitor renewable energy capacity, emissions reductions, and adaptation measures. Regular updates should be publicly accessible.

• Learn from Success Stories: Study successful cases from other countries. Understand how they achieved their targets and adapt relevant strategies to Sri Lanka’s context.