National assets in the power sector

The Yugadhanavi Power Plant in Kerawalapitiya is much in the news at present. There is an allegation that 40% of the shares of this national asset are to be sold to an American Company and there are those who insist that this National Asset must not be sold to the private sector.

It is interesting to examine the facts first as to how the Yugadhanavi Power Plant became a National Asset.

In 2005, when the new government was elected to office, it was apparent that a serious power crisis was looming, and that immediate action was required. The government decided to call for proposals from a subsidiary of Lanka Transformers Ltd, Lakdhanavi Ltd which had already constructed two power plants at that time in the country. The CEB owns 63% of the shares of Lanka Transformers Ltd.

Lakdhanavi Ltd gave a proposal to build and hand over a 300MW Combined Cycle Power Plant at Kerawalapitiya. Two related companies from Japan and China also gave similar proposals.

A CANC was appointed to evaluate the proposals and the CANC was divided on the matter. Lakdhanavi Ltd had given the cheaper offer, but had not done a similar project before.

After the intervention of the then Secretary, Ministry of Power, sanity prevailed, and the government took a decision to award the contract to the local party.

Thus, the present Yugadhanavi Power Plant was designed and built by local engineers of Lakdhanavi Ltd, in less than three years, proving their capability. If not for the intervention of the then Secretary to the Ministry of Power, this Sri Lankan Asset would have been a Chinese Asset.

In 2016, tenders were called for the construction of a 350MW Combined Cycle Power Plant at Kerawalapitiya and the lowest evaluated tender was from Lakdhanavi Ltd.

Then the Secretary of The Ministry of Power at that time, with the support of the minister, decided to award the contract to a Chinese company who had submitted the second highest bid. Lakdhanavi had to battle this matter in the Courts for 04 years. Unfortunately, persons who are now raising several issues about the disposal of National Assets were silent at that critical time.

Again in 2020, on the intervention of Gotabaya Rajapakse the contract was awarded to Lakdhanavi Ltd. Now Lakdhanavi Ltd is in the process of building the power plant. Thus, for the second time, a Sri Lankan Asset is being created instead of a Chinese one – history is repeating itself!

LTL Holdings (PVT) Ltd Staff Union