Marginalisation of Off-grid Energy Sector in Sri Lanka: What Lessons could be Learnt?

Renewable energy based off-grid projects have played a crucial role in Sri Lanka’s universal electrification effort. The paper in this context unravels two crucial and quite interrelated aspects of decentralised off-grid energy development in the country; i) to critically analyse the off-grid electricity sector development and assess its contribution to the universal electrification in the country, and ii) to examine the current challenges associated with the off-grid sector in the larger context of massive grid expansion. A mix of quantitative and qualitative research methods is employed as an analytical tool. The paper brings out several policy relevant findings. Strategic policy interventions coupled with targeted policy goals, robust community centric interventions, well designed credit systems, and well-structured capacity building initiatives are identified to be key leveraging points for success of off-grid micro-hydro projects. The techno-economic analysis of existing micro-hydro project reveals there exist opportunity for more productive use of such projects. Grid interconnection of off-grid energy projects is a major emerging challenge involving a whole gamut of technical, legal, regulatory, financial and social issues. Interestingly, the intensity of these challenges differs across ownership types.