The Asian Development Bank (ADB) has approved a $100 million policy-based loan to support Sri Lanka in advancing reforms in its power sector, building on previous efforts to ensure a financially sustainable and efficient electricity system.
This financing, part of the second subprogram of ADB’s Power Sector Reforms and Financial Sustainability Program, will accelerate the unbundling of the Ceylon Electricity Board (CEB) into independent successor companies for generation, transmission, system operation, and distribution, as mandated by the Electricity Act of 2024 and its 2025 amendment. The phased approach prioritizes financial sustainability while ensuring a structured transition.
“Sri Lanka has made important progress in stabilizing its economy. A well-functioning power sector is vital for sustainable growth,” said ADB Country Director for Sri Lanka, Takafumi Kadono. “This initiative will strengthen governance, foster private sector participation, and accelerate renewable energy development.”
The program will support cost-reflective tariffs, debt restructuring, competitive procurement of renewable energy projects, and social inclusion measures such as lifeline tariffs and women’s leadership programs.
ADB will also provide a $2.5 million technical assistance grant to build the capacity of successor companies and develop business and power system development plans.
