Sri Lanka secures funding for rooftop solar and smart grid project

Sri Lanka has secured a 35-million-dollar concessional loan from the Asian Development Bank, along with grants from the European Union and Japan, to expand access to affordable and clean energy.

The financing includes a 15.4-million-euro EU grant, worth approximately 16.94 million dollars, and a 5.5-million-dollar grant from Japan’s Joint Crediting Mechanism Fund.

The project will be implemented from 2026 to 2030 by the Ministry of Energy, together with Electricity Distribution Lanka and Lanka Electricity Company.

It will modernise electricity distribution through smart meters, advanced metering and distribution management systems, improving grid reliability and enabling faster restoration following power outages.

The project will also introduce Virtual Net Metering in Sri Lanka for the first time, with 25 megawatts of aggregated rooftop solar capacity planned to support small and medium-sized businesses.

Battery storage systems and upgraded distribution infrastructure will further increase the grid’s capacity to accommodate renewable energy.

Particular attention will be given to the Negombo area, where the project is expected to strengthen the network, support new commercial and industrial connections, and improve the flexibility and reliability of electricity supply.

The relevant loan and grant agreements were signed at the General Treasury in Colombo on October 1, 2026 by Finance Ministry Secretary Dr Harshana Suriyapperuma and ADB Country Director for Sri Lanka Shannon Cowlin.

EU and Japanese representatives also attended the signing ceremony.