We carried out a comprehensive restructuring of Sri Lanka's power sector. On behalf of the Asian Development bank, this program was undertaken in the context of the national policy on electricity that is focused on enabling Sri Lanka to meet the increasing demands for electricity, with particular emphasis placed on increasing supply to rural areas. The Electricity Reform Act of 2002 provides the basis for the restructuring program and the provisions of this Act are now being implemented.

As a key component in this far-reaching program, we supported the Sri Lankan Power Sector Reform Office (PSRO) in the project management by preparing a roadmap, time lines and guidelines for the entire process. We provided hands-on support to work groups involved in legal, financial, human resources, metering, settlement and operating code issues.

We assisted the PSRO in many aspects of the key work to separate the existing power sector organizations, Ceylon Electricity Board and Lanka Electricity Company, into standalone generation, transmission and distribution companies.

This unbundling, and the establishment of an independent regulatory authority with responsibility for establishing appropriate tariff setting mechanisms, follows from the Electricity Act 2002 and its objective of increasing the efficiency of the power sector.