Energy / Electricity transmission and distribution - Energy efficiency and conservation - Renewable energy generation - small hydro

The proposed TA and ensuing project are consistent with Sri Lanka's national and sector priorities. The 2006 10-Year Development Framework of Sri Lanka, focusing on infrastructure development to accelerate economic growth and narrow regional disparities, and the National Energy Policy and Strategies (NEPS), a ten year plan for the energy sector, envision sustainable development of energy resources, conversion facilities and delivery systems to enable access to and use of energy services by the entire population, and the safe, reliable delivery of such energy services at a competitive price. As such, the NEPS provides a comprehensive road map for the sector, includes a long-term investment program and specific policy and reform measures, and aims to (i) supply electricity to 86% of households by 2010 and 98% by 2016, and (ii) ensure electricity tariffs are competitive with those in other countries and sufficient for utilities to be viable. The Government's main goals are to improve the quantity, quality, and cost of service delivery, and to increase electricity connections in rural areas.

The proposed TA and ensuing project are also consistent with ADB's Sri Lanka Country Partnership Strategy (CPS). To help the Government achieve the above-mentioned main goals, CPS focuses, among others, on (i) mitigating climate change through financing individual clean energy projects, including small and medium-scale hydro, (ii) funding transmission projects to remove grid constraints on absorbing additional capacity from renewable energy sources and to achieve energy-efficiency improvements through strengthening of the transmission network, and (iii) improving connectivity for the poor.