Context:
Sri Lanka has revoked a 2024 power purchase pact with Adani Green Energy for a proposed wind power plant in the island’s Northern province following corruption allegations, news agency AFP reported.
Key Findings:
- Development Summary
- Sri Lankas administration cancelled the proposed 2024 power purchase contract with Adani Green Energy for its wind power venture in the Northern Province. Two wind power ventures at Mannar and Pooneryn would be involved in the 442 million project and will be critically examined.
- Corruption Allegations
- Lacked a transparent tendering process for the project award.
- High Costs
- A competitive bidding process could have reduced the costs of the project by many folds.
- Environmental Concerns
- There was opposition based on the fact that the project area was considered a critical aviation corridor and that it may cause disruption to this corridor.
Background and Controversy
Approved by the Ranil Wickremesinghe government in February 2023 the project was opposed by:
- Environmentalists Cited concerns about ecological and aviation corridor impacts.
- Economists criticized the high rate of power purchase.
- Anti Corruption Activists criticized the fact that there was no competitive bidding process.
Way Forward
The revocation of the agreement signals Sri Lanka’s push toward more transparent and costefficient foreign investments. Of course the project is not canceled but rather the renewed examination highlights the governments efforts to align energy projects with national priorities as well as ensure fairness in investment processes.
