The World Bank Group launches a $150 million initiative to boost Sri Lanka’s clean energy shift, targeting 1GW in solar and wind power, slashing fossil fuel dependency, and unlocking $800M in private investments.
World Bank Group Approves $150M to Power Sri Lanka’s Clean Energy Future
In a major step toward transforming Sri Lanka’s energy sector, the World Bank Group has approved a $150 million initiative titled “Secure, Affordable, and Sustainable Energy for Sri Lanka.” The program aims to reduce the nation’s heavy dependence on fossil fuel imports and propel it toward a cleaner, more resilient energy future.
“This program will help deliver clean, affordable electricity to families and businesses across Sri Lanka,” said David Sislen, World Bank Division Director for the Maldives, Nepal, and Sri Lanka. “We are excited to work with both the government and private sector to make this shared vision a reality.”
The centerpiece of the initiative is the development of solar and wind power infrastructure capable of adding 1 gigawatt of clean electricity to the national grid. This push will move Sri Lanka closer to achieving its national goal of generating 70% of electricity from renewable sources by 2030. The program is expected to catalyze more than $800 million in private sector investments, which will contribute to lowering electricity costs and enhancing reliability for households and businesses.
A crucial element of the package includes $40 million in World Bank guarantees in its first phase, specifically designed to reduce payment risk for private investors and power producers. These guarantees target obligations from the Ceylon Electricity Board (CEB), increasing investor confidence and facilitating financing at more favorable rates.
The World Bank Group’s private sector arms the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA) will complement the program. IFC will provide direct investments and advisory support, while MIGA will offer political risk insurance, reducing exposure to volatility and helping international investors navigate Sri Lanka’s energy sector.
“Sri Lanka’s energy transition is an opportunity to expand clean energy, improve energy access, and build long-term resilience,” said Imad N. Fakhoury, IFC’s Regional Director for South Asia. “By partnering across sectors, we aim to drive sustainable growth, create jobs, and power a better economic future for Sri Lanka.”
MIGA’s Director of Operation, Muhamet Fall, echoed the sentiment. “Investors need confidence to take bold steps in new markets. Our guarantees will help de-risk projects and attract the private capital needed to scale up clean energy in Sri Lanka.”
Beyond generation, the program will also help modernize Sri Lanka’s aging grid infrastructure to support renewable energy integration and reduce frequent power outages. A more robust grid is expected to stabilize electricity prices and expand reliable access nationwide.
In parallel, the World Bank will provide technical assistance to CEB to improve power planning, procurement, and operational efficiencies. Additionally, the initiative supports broader reforms to enhance utility competitiveness, regulatory governance, and financial sustainability.
The program leverages the World Bank Group’s full suite of capabilities funding, expertise, and partnerships to empower Sri Lanka’s clean energy goals and bolster its economic trajectory.
