Sri Lanka's renewable energy opportunity for businesses

For years, the foundation of Sri Lanka's economy has been its strategic location and vibrant business landscape. However, a heavy reliance on imported fossil fuels has long loomed over this progress. This dependence has made Sri Lankan businesses vulnerable to global market volatility, creating an unstable environment for long-term growth and planning.

The pressing need for energy security and predictable costs is not just a national concern — it’s a crucial matter of survival for every business owner. This blog post will explore how leveraging on the vast renewable energy potential in Sri Lanka can reduce costly imports, benefiting local businesses and fostering a more sustainable and prosperous future.

The current energy burden: High costs for businesses

Volatile energy costs impacting business competitiveness

Stability is key for small business owners. Yet, the price of imported fossil fuels is anything but stable. Fluctuations in global oil and gas prices lead to unpredictable electricity tariffs and fuel costs, making it nearly impossible for businesses to forecast their operating expenses accurately. This volatility erodes profit margins and makes it difficult to maintain a competitive edge, both locally and in global markets.

Drain on national foreign exchange affecting import-dependent businesses

The substantial foreign currency outflow required to pay for fuel imports places a significant strain on the national economy. In 2023 alone, Sri Lanka spent approximately $400 million on petroleum fuels and close to $500 million on coal.¹ This can lead to a scarcity of foreign exchange, which can critically affect businesses that rely on import and export activities in Sri Lanka. 

When foreign currency reserves are constrained, it can become more difficult for businesses to source raw materials, machinery and finished goods from overseas. In turn, this can disrupt supply chains and stall production, impacting businesses from small retail shops to large-scale manufacturers.

Sri Lanka's untapped potential for local power

Despite everything, the good news is that Sri Lanka is blessed with an abundance of natural resources that can serve as foundations for generating renewable energy.

Solar power opportunities for commercial and industrial use

With its advantageous location near the equator, Sri Lanka receives ample sunlight all year round. This makes solar power a highly viable solution for businesses seeking to reduce their electricity bills and secure a more stable source of energy. Installing rooftop solar power systems is becoming increasingly accessible and cost-effective for commercial and industrial enterprises, lowering operation costs significantly. 

As of early 2024, the total installed rooftop solar capacity stood at over 930 MW, highlighting a significant and growing trend among businesses and consumers.² With the price of solar power in Sri Lanka becoming more competitive, it’s gradually presenting itself as a sound financial investment for business owners. 

Wind energy potential for grid stability

Sri Lanka's coastal regions and highlands are known for their strong, consistent wind corridors. These areas offer significant potential for large-scale wind energy that can deliver a reliable source of clean power to the national grid. A more stable and robust grid in Sri Lanka, powered by domestic sources, benefits all businesses by ensuring a consistent power supply and reducing the risk of outages.

Hydropower and biomass: Reliable baseload contributors

Hydropower has a long history in Sri Lanka and already serves as a major component of the country's energy mix. Existing hydroplants provide a strong baseload, which is the minimum level of power needed to meet demand. In addition, consistent sources of biomass from agricultural and forest waste can be harnessed for power generation. These renewable energy sources offer continuous power, which is vital for uninterrupted manufacturing and essential services. 

Beyond savings: Broader benefits for the business ecosystem

Moving towards renewable energy isn't just about cutting costs – it’s about building a more resilient and attractive business environment.

Bolstering national energy security for business continuity

Developing sustainable energy in Sri Lanka can reduce the country’s dependence on volatile international markets. This shift mitigates geopolitical risks and ensures a more stable power supply, reducing disruptions to business operations. From a business owner’s perspective, this means greater peace of mind and the ability to focus on growth without the constant threat of power instability.

Catalyzing new business and job creation in the sustainability sector

The transition to a more sustainable economy opens up a new frontier for entrepreneurship. Small and medium-sized enterprises (SMEs) can find new opportunities in the rapidly growing renewable energy sector, from project development and manufacturing of components to the installation and maintenance of these systems. This new wave of innovation has the effect of strengthening the entire business ecosystem in Sri Lanka, all while promoting sustainable practices.

Enhancing Sri Lanka's sustainability and export appeal

As global consumers and businesses become more environmentally conscious, a country's commitment to sustainability can be a powerful selling point. Embracing a cleaner energy profile in Sri Lanka can enhance its national brand and make exports more appealing to environmentally-discerning global markets. For local businesses, this can translate into new partnerships on top of access to new, more lucrative overseas markets.

Sri Lanka's sustainable vision for businesses

The potential of Sri Lanka’s renewable energy drive for its economic future cannot be overstated. By shifting away from costly fossil fuel imports, the nation can build a more secure, stable and competitive business environment. This vision directly benefits the growth of businesses by offering lower, more predictable energy costs and creating new job opportunities.

Partnering with DHL Express for a sustainable future

As businesses in Sri Lanka increasingly start to embrace sustainable business practices, it’s essential to align with global shipping partners who share this commitment. With GoGreen Plus, DHL Express offers businesses a simple way to reduce the carbon emissions of their shipments using Sustainable Aviation Fuel (SAF). Not only can this help businesses meet their sustainability goals, it also has the benefit of appealing to environmentally-conscious worldwide.

Whether you are looking for reliable international shipping services or a trusted overseas courier service, choosing DHL Express means partnering with a company that actively works to reduce the carbon footprint of its operations. Start your journey towards sustainability today and sign up for a business account with us.