Development of variable renewable energy policy in developing countries: A case study of Sri Lanka

Development of policy for variable renewable energy (VRE), such as wind and solar power, could be difficult in developing countries that have limited capacity, limited technical, and fiscal resources. Sri Lanka is such a case. Although Sri Lanka has a potential to develop VRE, the development was neither sufficient nor smooth. This study explores the development of VRE in the 2000s and analyses the impacts of the cost reflective feed-in-tariffs (FITs). The study finds that VRE public policy in Sri Lanka can be improved in a number of ways: better coordination among government agencies; technology specific policy and accommodation of cost dynamics; and redesign of subsidy policies. Generally, the governance mechanism suggested in this research is an innovated structure to coordinate multiple government agencies by specifying policies according to technologies and redesigning the subsidy structures by accommodating the cost dynamics.