LECO targets Rs 796 m profit

Ministry aims to reduce transmission loss :

Dharma SRI ABEYRATNE

Lanka Electricity Company (LECO) has targeted to increase its profit to Rs 796 million this year against last year’s profit of Rs 264 million, LECO Chairman Chandana Haputantri said.

LECO which is a Government owned institution, is engaged only in electricity transmission. With an ownership of 50 percent shares, the Ceylon Electricity Board (CEB), had become the main stakeholder of LECO, while the Treasury has become the next stakeholder, obtaining 44 percent stakes.

The UDA and other Government institutions own the remaining six percent shares. LECO is engaged in electricity transmitting activities in the Western and the Southern coastal areas to 469,000 customers.

In accordance with the profitability analysis, LECO has estimated an annual revenue of Rs 18.5 billion this year, as opposed to the 2010 revenue of Rs 14 billion. LECO intends to achieve this record profit through the new management and administrative reforms introduced by Power and Energy Minister Patali Champika Ranawaka.

The new management and financial discipline introduced recently, had been highly successful. Under this initiative, LECO could reduce its expenses significantly. In line with this success, LECO expects to improve further the quality of its services including reducing the transmission loss. However, LECO is maintaining the transmission loss to around 5 percent even though the CEB transmission loss is around 15 percent. In accordance with the world electricity criteria, the transmission loss of around 7 percent, is considered a unique achievement.

“As a people owned entity, LECO has no idea to go for a profit maximisation. But it has to be kept above the break even point by making a certain amount of profit,” Power and Energy Minister Patali Champika Ranawaka said. The Minister said that the Power and Energy Ministry would renovate the electricity transmission system this year aiming to reduce the transmission loss.