$ 1.7 b solar project in Poonakary: Australian investor yet to obtain EIA

The failure of the Australian investor, United Solar, to obtain the Environmental Impact Assessment (EIA) report on time for the mega-scale solar development project scheduled to be constructed in Poonakary, Jaffna, has resulted in a delay in concluding the Power Purchasing Agreement (PPA), The Sunday Morning learns.

As a result, it is expected that the project will not meet its initial timelines.

The project, valued at a total of $ 1,727 million, aims to create a mega-scale 700 MW solar power plant in the Poonakary Tank.

Speaking to The Sunday Morning, Sri Lanka Sustainable Energy Authority (SLSEA) Chairman Eng. Ranjith Sepala said the delays were due to the investor’s failure to submit the EIA on time.

“Renewable energy projects are being delayed due to various reasons. One such reason is the delays of the investor,” he stressed.

Initially, the investor company, United Solar, was expected to inject the first tranche of $ 500 million before March of this year.

However, a United Solar spokesman revealed that the company could not provide exact timelines yet as it was awaiting the signing of the PPA with the Ceylon Electricity Board (CEB).

Last December, the Cabinet granted approval to enter into a PPA with the United Solar Group of Australia.

In September, the Cabinet approved the proposal presented by the Minister of Power and Energy to accept the project proposal from United Solar Energy SL, a private company.

The proposal involves the development of a 700 MW solar power plant with a battery energy storage system at the Poonakary Lake. The objective is to provide a power supply of 134 MW in principle and a Cabinet-Appointed Negotiation Committee was appointed to evaluate the proposal and make recommendations.

The project proponent company has suggested constructing three anicuts around the Poonakary Lake, costing $ 13.5 million, as part of the proposed project to prevent the ingress of seawater.

The SLSEA issued provisional approval for the project’s implementation to United Solar on 17 August 2022. The Letter of Intent (LoI) was issued by the CEB on 16 August 2023 and Cabinet approval was granted on 11 September 2023.

The company was to bring down the entire investment as 100% Foreign Direct Investment (FDI) within 12 months of the signing of the PPA with the CEB.