U.S. Position on the Ceylon Electricity Board Wind Power Generation Project

(Sri Lanka)

October 24, 2017

Sri Lanka has demonstrated robust and steady growth over the past decade that has been coupled 

with an impressive improvement in its development indicators, particularly energy access, 

reaching a national electrification ratio of 99.3 percent in 2016. Despite this achievement, the 

sector is struggling to meet growing electricity demand with low cost, reliable power, and there 

is an urgent need to develop new clean sources of energy to safeguard both energy security and 

the environment. In addressing these concerns, the Government of Sri Lanka seeks to increase 

the share of non-conventional renewable energy to 20 percent of total generated power by 2020, 

including through the development of wind resources.

ADB’s proposed Ceylon Electricity Board Wind Power Generation Project follows the second 

tranche of a Multitranche Financing Facility (MFF) approved by the Board in November 2016 

that would, among other activities, finance the construction of a 220-kilovolt transmission line to 

evacuate power generated on Mannar Island to the national grid. The United States abstained on 

that project due to the project’s high potential for adverse impacts on a Ramsar Wetland of 

International Importance that is a critical habitat for migratory and congregatory birds. This 

includes one critically endangered bird (the Great Knot) and several nationally protected species, 

both of which pass through Mannar Island on the Central Asian Flyway, one of the world’s great 

bird migratory routes. Unfortunately, while this project has the laudable outcome of increasing 

Sri Lanka’s clean power by 100 MW, it also has the potential to contribute further to these 

adverse impacts. 

Given concerns about the potential impacts of this project, staff from the Office of the United 

States Executive Director and the U.S. Agency for International Development (USAID) visited 

the site. From that site visit and the review of the Environmental and Social Impact Assessment 

(ESIA), the United States believes that baseline data collection was inadequate to fully assess the 

direct impacts of the proposed wind farm to bird populations and that problematic project 

sequencing relative to the prior MFF complicated the process of assessing project alternatives.

First, addressing the baseline data and the determination of impacts on bird populations. The 

United States concluded that the baseline data did not include sufficient observations throughout 

the day and over the seasons, thus incompletely capturing the dynamism of migratory species. 

Despite this shortcoming, the ESIA clearly indicated that, after avoidance, minimization, and 

restoration, protected bird species are likely to suffer high death rates due to collisions with the 

turbines. ADB staff has assured the United States that the migratory season coincides with low 

wind season, thus naturally decreasing the potential for collision, and that the wind farm’s radar 

monitoring system will automatically shut down operations upon detecting bird and bat 

movements. The Government of Sri Lanka has agreed to invest in state-of-the-art technology to 

achieve this curtailment during migratory season. 

The use of the radar technology is to be commended, but it will be expensive and there will be 

financial incentives to keep the turbines operating. In any case, the temporary shutdowns will 

affect the viability of the economic analysis. Absent more robust baseline data, ADB is not in a 
position to determine if the ten percent energy yield variation in the sensitivity analysis 

adequately reflects the degree of necessary expected curtailment. Further, given its financial 

impact, it is not clear why this variable was not also considered in the financial analysis. The 

direct impacts will likely be significant, in which case operators will face a difficult choice 

between limiting environmental impacts and maintaining financial sustainability. The United 

States has requested that ADB provide the detailed criteria for operations curtailment and 

protocols once the radar supplier is selected. 

Second, regarding the assessment of alternatives, the United States has concluded after detailed 

discussions with ADB staff and extensive review that the ESIA does adequately consider the noproject alternative for different locations of the substations and associated wind towers. Ideally, 

however, the ESIA would have considered project alternatives outside the immediate project 

area on Mannar Island. Indeed, it is difficult to assess alternatives at this stage, as the 

transmission line was approved in last year’s MFF. Financing such associated facilities 

separately over several years is clearly part of the problem. The United States asks that ADB

Management bring closely associated projects for Board consideration in a manner that allows 

for a prudent consideration of all impacts and alternatives. 

Third, the United States notes that the ESIA contains a collision risk assessment for critical parts 

of the associated transmission line (including the 7.5 km section that passes through the Vankalai 

Sanctuary Ramsar site), the proposed wind farm, and the development of a further potential of 

wind energy on Mannar Island. ADB staff have assured the United States that this additional 

development is now unlikely to materialize given the government’s better understanding of the 

environmental and social limitations. The United States is encouraged that any future 

developments will be held to the requirements of the signed loan agreement, and have asked staff 

to clarify if this would also apply to potential private sector development on the site, given the 

focus on private sector engagement in Sri Lanka’s wind sector. 

Fourth, given that the migratory pathway that crosses Mannar Island is recognized as having 

international importance, and given the value of bird tourism for Sri Lanka’s economy, 

additional precautions should have been taken for a project like this. Did ADB consider 

constituting an independent expert panel in this case? Such panels should be reserved for cases 

with high impact.

Finally, and as the United States noted it is surprising and dismaying that a project with such 

significant potential environmental impact was originally to have been considered on a noobjection basis. The United States hopes and expects Management will approach this decision 

differently in the future. 

With these comments, the United States abstains on the proposed project.