A Malaysian company has filed an arbitration case against Sri Lanka over the cancellation of a USD 150 million wind/solar hybrid power plant project.
KLS Energy Lanka, the local subsidiary of Malaysian renewable energy producer Energy Sdn Bhd of Malaysia has initiated ICSID arbitration under the Sri Lanka-Malaysia BIT, due to the cancellation of a USD 150 million wind/solar hybrid power plant project by the Sri Lankan Government, reports said today.
The Acting Secretary-General of ICSID has registered the request for the institution of arbitration proceedings on October 24, 2018.
The Ministry of Power and Renewable Energy of Sri Lanka has been cited as the respondent.
The Ceylon Electricity Board (CEB) had reportedly approved the investor’s project for building the hybrid power plant in Jaffna in 2008, and also concluded a 20-year Power Purchase Agreement with KLS.
Sri Lankan Government cancelled the project in 2016, alleging that KLS had not continued its investment in the project.
Meanwhile, the investor has claimed that it had already invested USD 22 million and that the Government was responsible for any undue delays. (Colombo Gazette)