The Government of Sri Lanka has secured a USD 100 million policy-based loan from the Asian Development Bank (ADB) under the second subprogram of the Power Sector Reforms and Financial Sustainability Program.
The funding will support the unbundling of the Ceylon Electricity Board into separate entities for generation, transmission, system operation, and distribution, in line with the 2024 Electricity Act and its 2025 amendment. The program aims to strengthen the financial viability of the power sector through cost-reflective tariffs and a comprehensive debt restructuring plan, including transparent allocation of liabilities across the new companies. It also targets enhanced private sector participation and renewable energy uptake through competitive procurement and improved governance. In addition to the loan, ADB will provide a USD 2.5 million technical assistance grant to support implementation, build institutional capacity, and aid in the development of business and power system plans for the successor utilities.
