Sri Lanka’s power policy loan received a major boost with the signing of a US$100 million agreement with the Asian Development Bank. The facility reinforces the country’s ongoing power sector reforms, aimed at creating stronger, more sustainable energy systems. This Sri Lanka power policy loan also advances national efforts to expand renewable energy and improve financial stability in the utilities sector.
Sri Lanka power policy loan strengthens utility and renewable energy reforms
Sri Lanka has entered into a US$100 million power policy loan agreement with the Asian Development Bank after completing key reform actions in the energy sector. The Finance Ministry announced that the policy-based funding is designed to support the creation of independent and financially sustainable electricity utilities capable of meeting the country’s long-term energy demands.
According to the ministry, the Sri Lanka power policy loan will also accelerate the development of renewable energy initiatives, a critical priority as the nation seeks to diversify electricity generation. The reform commitments under the second phase of the program were carried out by the Ministry of Energy in collaboration with the Ceylon Electricity Board, the Sri Lanka Sustainable Energy Authority, Lanka Electricity Company Pvt. Ltd., and the Public Utilities Commission of Sri Lanka.
Once the agreement becomes effective, the entire US$100 million will be disbursed to the Treasury. The loan was formally signed by Harshana Suriyapperuma, Secretary to the Ministry of Finance, Planning and Economic Development, and Cholpon Mambetova, Country Operations Head at the ADB Sri Lanka Resident Mission.
Sri Lanka is also in discussions with the Asian Development Bank regarding a US$3 million grant to support emergency relief and rehabilitation efforts related to Cyclone Ditwah. The grant is expected to be provided through the Asia Pacific Disaster Response Fund and will be used for rapid response needs such as rescue equipment, medical supplies, food assistance, sanitation facilities, transitional shelters, hygiene kits, debris-clearing machinery, aviation fuel, and communication tools required for post-disaster operations.