Discussions on CEB crisis

Eng. M. V. R. Perera

CEB CRISIS: Seeing some false statements in the media I give my independent opinion on my varied experience.

There are several discussions on CEB crisis with so called experts but none of them appear to have even read the CEB Act but discussing some vague reasons for breaking up CEB into several companies.

However, should not all these people and chairmen and directors of CEB from 2000 to date be prosecuted for violating section 38 of the CEB Act and bringing CEB to bankruptcy, in other countries such persons are prosecuted and sent for almost life imprisonment.

Section 38 of CEB Act state thus "It shall be the duty of the Board so to exercise its powers and perform its functions under this Act as to secure that the total revenue of the Board are sufficient to meet its total outgoings properly chargeable to revenue account including depreciation and interest on capital and to meet a reasonable proportion of the cost of development of the services of the Board."

Also should not all the above persons be persecuted for deceit, in order to establish the myth that private companies are profitable, after CEB incurring such losses which can easily be estimated at 17 billion rupees per year subsidising LECO another licensee, not a consumer, to the tune of Rs. 2.5 billion a year by selling to LECO electricity at a loss to CEB. This has encouraged LECO to such waste and corruption which cannot be imagined compared with the so called corruption in CEB, only an investigation of LECO by the Auditor General will reveal these.

It should be noted the amount of Rs. 7 billion that the government is expecting to get from ADB is less than three years subsidy given to LECO by CEB and is only 41 per cent of the annual loss of CEB due to CEB violating section 38 of CEB Act.

If a very impartial investigation is made it could easily be established the one and only cause for the CEB crisis is the delay in construction of Coal Fuelled Thermal Power which delay will cause a loss of over Rs. 400 Billion to CEB and country and will cause more losses if another two Coal Fuelled Thermal Power Stations of 900 MW capacity each do not come on bars by 2013.

The estimate for the loss to CEB and the country in the delay in Coal Power It is assumed the cost of an Oil Fired Unit is Rs.10 and a Coal Fired Unit is Rs. 4.50. The difference is Rs. 5.50. However, in 2000, the difference would have been Rs. 2.50 and since there can be a further increase in the price of oil the difference is taken as Rs. 4.50. The average Hydro unit generated is taken as four billion units per year.

In 2000 the gross generation was 6.7 billion units.

The Total units generated up to 2013 which year Norochcholai Coal Fired Thermal Power Station is expected to be commissioned giving seven Billion Units per year at plant factor 90 per cent is 6.7 (1.08 13-1)/1.08-1 billion units increasing every year by 1.08.

= 6.7(2.72-1)/0.08 = 6.7x1.72/0.08 = 144 billion units

The Total Hydro units is 4 x13 = 52 billion units

The Oil Fired Units 144-52 = 92 billion units

The loss to CEB and country is 92 x 4.50 = 414 billion Rupees

In 2013 the gross generation requirement is

6.7 x 2.72 billion units

= 18.2 billion units Hydro is 4 billion units

The 14.2 Oil Fired Units at Norochcholai will give seven billion units. The balance 7.2 billion units will be expensive Oil Fired Units, as such how can Norochcholai be sufficient. Another 900 MW of coal will have to come up by 2013 to take up the 7.2 billion units of expensive Oil Fired Units.

Also a 3rd coal powered unit also should come up to cater for the yearly increase of about (18.2 x 1.08 - 7 - 4 -7) = 19.7 - 18 = 1.7 billion units. This is assuming the 2nd coal fired station is in full operation. This should be worked out to an accuracy as possible and then only the full effects of the delay in coal power will be felt. Can any organisation loose 400 billion rupees and should also have altogether 3 Coal Fired Power Station fully operational by 2013 to stop further losses and this delay not been identified as the only cause of the present crisis is unthinkable.

However, it is hoped at least CEB Engineers will work out the loss due to the delay in coal power for their plans.

Coal power should have come up by 2000 and by 2013 two more should have come up. This lag of two Coal Power Stations by 2013 may put the country into bankruptcy with a price of a unit going up to 12 to 15 rupees and also cooking by gas also becoming very expensive with no alternate cheep coal fired electricity to be used for cooking as well as electrification of railways.

As such it is important that the loss due to the delay in coal power be identified and action taken to keep the loss to at least 400 billion rupees by constructing another two coal power stations.

CEB is doing this only to get the balance 70 million dollars from the ADB which is about seven billion rupees which is less than three years subsidy given to LECO by CEB and only 40 per cent of the annual loss to CEB because CEB is contravening section 38 of CEB Act.

The writer has been the Chief Engineer Thermal Generation in the CEB in 1978 was trained in a Coal Power Station at Basin Bridge Madras in 1960 was trained in garbage disposable power station in Stutgat in Germany in 1972, was also the Engineering Manager of LECO up to 1995 now long retired.