The Energy Ministry is drafting an electricity tariff formula that would be revised only once a year, replacing the current structure in which prices are reset every three months, a senior ministry official told the Sunday Times.
Talks are ongoing with the Finance Ministry to finalise the mechanism before it is submitted to the Public Utilities Commission of Sri Lanka for approval.
The proposed formula would build seasonal weather patterns into a single annual rate. Under the existing system, tariffs rise during the dry early months of the year and fall during the rainy second half as hydropower output expands. The official said the Ceylon Electricity Board would run a financial loss over the first six months but recover in the wetter second half, allowing the net tariff to stay fixed for the year.
Consumers and businesses would be able to plan without the quarterly price shocks that have dominated recent cycles, the official argued, adding that the change would have “comparatively less impact on the cost of living” because many goods and services currently reprice with each electricity revision. Similar formulas operate in other countries, he said.
The announcement arrives while the regulator is still reviewing the NSO’s 15 percent Q2 tariff hike request and a separate 53 percent filing linked to the Lakvijaya coal crisis. It also sits alongside the automatic fuel and electricity tariff mechanism announced earlier this year.
