Power Minister Anura Karunathilaka yesterday acknowledged that the Government’s decision to increase electricity tariffs by 18% will have an indirect impact on consumers across the economy, whilst insisting that the direct effect on the majority of electricity users remains limited.
Addressing the media, he said while most households will not see an immediate increase in their electricity bills, higher tariffs imposed on industrial and commercial users are likely to be passed on through higher prices of goods and services.
‘I am saying this tariff hike doesn’t directly affect most electricity bills, but industries and commercial users who are affected will eventually pass on those costs to consumers,’ he said.
The Minister defended the revision, arguing that the Government was unable to absorb the full cost adjustment required in the power sector and had instead taken on a significant share of the burden through fiscal support rather than transferring it entirely to electricity users.
‘In an uncertain global environment, utility costs naturally come under pressure. But as a responsible Government, we have not passed the full burden either to end users or to the State-owned entities. We are sharing that burden through Treasury support. We think it is the responsibility of a responsible Government,’ he said.
He said the Government has committed a Rs. 15 billion subsidy to support the National System Operator Ltd., (NSO) until September, cushioning the impact of rising generation costs.
The tariff revision, approved by the Public Utilities Commission of Sri Lanka, came into effect yesterday for the second and third quarters of 2026 after the NSO cited rising fuel prices, changing generation patterns, and an estimated Rs. 38 billion revenue gap.
Deputy Power Minister Arkam Ilyas said the revision was driven by three key factors; adverse weather affecting the power generation mix, a sharp rise in global fuel prices, and increased electricity demand, which has grown by 150 to 200 megawatts this quarter alone.
Karunathilaka said Sri Lanka currently has 7.91 million electricity users, of which 6.75 million are domestic consumers. Of these, 6.43 million households, or over 90%, use less than 180 units per month and therefore will not face a direct tariff increase.
He added that of 49,096 religious places connected to the grid, 38,566 or nearly 79% also fall below the 180-unit threshold.
‘Therefore, the latest revision directly affects only 7.29% of total electricity users, including just 4.06% of household users,’ the Minister pointed out.
Karunathilaka also rejected allegations that the tariff increase was linked to losses stemming from alleged substandard coal imports, insisting any such losses would be recovered from suppliers and through enforcement provisions in procurement contracts.
He assured that the current tariff structure will remain unchanged until September, noting global fuel costs, weather patterns, and demand projections have all been factored into the pricing model.