Sri Lanka Seeks to Cut Costs in Adani Wind Power Deal

Sri Lanka's government intends to renegotiate the power purchasing agreement with Adani Green Energy for a wind power project to lower costs under USD 0.06 per unit. The previous agreement was contested due to higher prices compared to local offers. Adani remains committed to a USD 1 billion investment.

Sri Lanka's government plans to renegotiate its power purchasing agreement with Adani Green Energy, aiming to slash the cost per unit to less than USD 0.06. This move comes amidst disputes over a prior agreement that locked in prices at 8.2 cents per unit, significantly higher than local bids. The new government of Sri Lanka has shown commitment to revising deals set by its predecessors, aligning projects with current priorities.

The previous administration faced criticism for its decision to approve a 20-year agreement at competitive test rates while local companies offered more economical options. The National People's Power (NPP) Party had previously vowed to reconsider the Adani green energy project, indicating a shift in priority towards cost-effectiveness and better economic engagement.

Despite media reports suggesting a possible cancellation of Adani Green Energy's projects in Mannar and Pooneryn, the government clarified that it would appoint a committee to review the entire project. Adani has reiterated its commitment to investing USD 1 billion in Sri Lanka's green energy endeavor, underscoring its intention to support the nation's renewable energy and economic growth.

(With inputs from agencies.)