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Summary of Sophisticated Sri Lankan Tariffs

In 2010, Sri Lanka launched a sophisticated program of feed-in tariffs. Sri Lanka now has some of the highest feed-in tariffs for wind, hydro, and biomass in the developing world.

The Sri Lankan program has two tracks, one a fixed-price track without inflation protection, and a complex track that varies the tariff with the price of the base fuel rate, operations and maintenance, and the year of operation.

The variable tariff option provides a different tariff depending upon the year of operation. There is one tariff for years one to eight, another for years nine to 15, and a third tariff for years 16 and greater.

The variable tariff is the sum of the base rate for operations and maintenance, plus the base fuel rate, and a non-escalable fixed rate.

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