Sri Lanka: New Habarana - Kappalthurai Transmission Grid Expansion Project (AIIB-000897)

Regions
  • South Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • Sri Lanka
Geographic location where the impacts of the investment may be experienced.
Specific Location
New Habarana, Kappalthurai
Whenever identified, the area within countries where the impacts of the investment may be experienced. Exact locations of projects may not be identified fully or at all in project documents. Please review updated project documents and community-led assessments.
Financial Institutions
  • Asian Infrastructure Investment Bank (AIIB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Borrower
Government of Sri Lanka
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Energy
  • Infrastructure
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 35.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 35.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 42.80 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ AIIB website

Updated in EWS Apr 2, 2025

Disclosed by Bank Mar 27, 2025

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

As stated by the AIIB, the objective of the project is to increase the capacity and reliability of the transmission network from New Habarana to Kappalthurai to enable the integration of renewable energy from the eastern region of Sri Lanka into the national grid.

The project comprises the construction of a 77-kilometer (km) 220-kilovolt (kV) double-circuit transmission line and the augmentation and modification of two Grid Substations (GSSs) in Sri Lanka's Central (i.e., New Habarana) and Eastern region (i.e., Kappalthurai). The Government of Sri Lanka (GoSL) has undertaken this project to develop grid interfacing infrastructure to ensure efficient and uninterrupted electricity transmission from country's renewable energy (RE)-based generation plants in the eastern region towards major load centers.

With a target of generating 70 percent of electricity through renewable energy resources by 2030, the GoSL is keen on accelerating its RE transition. According to the Renewable Energy Resource Development Plan 2021-2026, published by the Sri Lanka Sustainable Energy Authority (SEA), there is a potential for 1,100 MW of renewable energy in the eastern region (in Trincomalee district) of the country. However, this area is currently connected to the national grid network by a transmission line over 45 years old, which has reliability issues. Given the potential of that region, the CEB has planned to construct a new transmission network from the New Habarana Grid substation to the Kappalthurai Grid substation with financial support from AIIB, emphasizing the need for transmission network capacity expansion in the project area. The following activities are planned in the project scope:

  • Construction of around 77-km 220kV double circuit transmission line from New Habarana GSS to Kappalthurai GSS
  • Augmentation and modification of New Habarana GSS (220/132 kV) and Kappalthurai GSS (220/33 kV)
Investment Description
Here you can find a list of individual development financial institutions that finance the project.

According to the AIIB, the Ceylon Electricity Board (CEB) will be the implementing agency and will contribute to the project with an investment of US$ 7.80 million.

Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

As stated by DevEx, Ceylon Electricity Board is a body corporate established on the 1st November 1969 under the Act of Parliament No. 17 of 1969. It is empowered to generate electrical energy, transmit the same and distribute it to reach all categories of consumers and to collect the revenue. It is also empowered to acquire assets, including human resources following the approved procedures. It is the duty of the CEB to make the optimal use of the resources through the application of pragmatic and time-tested managerial methods.

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - Ceylon Electricity Board Contractor Energy

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

AIIB Team Leader:

Raqib Ahmed Chowdhury - Investment Officer
Email: raqib.chowdhury@aiib.org

Borrower - Government of Sri Lanka:

Hemantha Pubudusiri - Director, Department of External Resources
Email: hemantha@erd.gov.lk

Implementing Agency - Ceylon Electricity Board (CEB):

Ravindra Dias - Project Director
Email: ravi_dias@yahoo.com

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.aiib.org/en/contact/information-request/index.html

ACCOUNTABILITY MECHANISM OF AIIB

The AIIB has established the Accountability Mechanism for Project-Affected People (PPM). The PPM provides Òan opportunity for an independent and impartial review of submissions from Project-affected people who believe they have been or are likely to be adversely affected by AIIBÕs failure to implement the ESP in situations when their concerns cannot be addressed satisfactorily through Project level GRMs or AIIB Management processes.Ó Two or more project-affected people can file a complaint. Under the current AIIB policy, when the bank co-finances a project with another development bank, it may apply the other bank's standards. You can refer to the Project Summary Information document to find out which standards apply. You can learn more about the PPM and how to file a complaint at: https://www.aiib.org/en/about-aiib/who-we-are/project-affected-peoples-mechanism/how-we-assist-you/index.html

The complaint submission form can be accessed in Arabic, Bahasa Indonesia, Bengali, Chinese, English, Tagalog, Hindi, Nepali, Russian, Turkish, or Urdu. The submission form can be found at: https://www.aiib.org/en/about-aiib/who-we-are/project-affected-peoples-mechanism/submission/index.html

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