A Road Map for Cleaner Fuels and Vehicles in Sri Lanka

Ministry of Environment and Renewable Energy

September 2014

CABINET DECISION ON ENHANCING THE QUALITY OF FOSSIL FUELS FOR MANAGING AIR QUALITY IN SRI LANKA

First Cabinet Decision:

Cabinet Paper No.l2/1225/527/025, a Memorandum dated 2012/08/15 by the Minister of Environment on "Enhancing the Quality of Fossil Fuels for Managing Air Quality in Sri Lanka" - the above memorandum was considered along with the observations of the Minister of Finance and planning and approval was granted –

(i) To appoint a Ministerial committee comprising of the following Ministers*:

 Hon. Susil Premajayantha, Minister of Environment and Renewable Energy;

 Hon. Patali Champika Ranawaka, Minister of Technology and Research;

 Hon. Pavithra Vanniarachchi, Minister of Power and Energy;

 Hon. Anura priyadarshana yapa, Minister of Petroleum Industries; and

 Hon. Kumara Welgama, Minister of Transport;

(* Then Ministers, Hon. Susil Premajayantha, Minister of Petroleum Industries; Hon. Patali Champika Ranawaka, Minister of Power and Energy; Hon. Pavithra Vanniarachchi, Minister of Technology and Research) to study all aspects pertaining to the enhancement of the quality of fossil fuels and to make recommendations to the Cabinet on the management of the quality of air and also on the institution where the proposed laboratory facility should be established; and

(ii) Appoint a Technical committee consisting of the following to assist the Ministerial committee in its deliberations -  a representative of the Ministry of Finance and Planning;  a representative of the Ministry of Petroleum Industries.  a representative of the Ministry of Environment;  a representative of the Ministry of Technology and Research;  a representative of the Ministry of Transport;  a representative of the Department of Motor Traffic;  a representative of the Central Environmental Authority; and  a representative of the Department of Chemical Engineering of the University of Moratuwa;

The Secretary, Ministry of Environment should function as the Secretary to the Ministerial Committee and also take action to submit the recommendations of the Ministerial committee within two (02) months, for consideration by the Cabinet. Accordingly, following members were appointed to the TC:

 Mr. B.M.U.D Basnayake, Secretary, Ministry of Environment &Renewable Energy  Prof. (Mrs) Padma Amarasinghe, Department of Chemical Engineering, University of Moratuwa  Mr. K.D.S.R. Perera, Director (Environment), Department of National Planning, Ministry of Finance & Planning  Mr. U.N. Mallawarachchi, Deputy Director (Planning), Ministry of Transport  Mr. R.M. Kulasena, Deputy Director, Environment Pollution Control Division, Central Environment Authority  Mr. M.P. Kasun Pramodith, Assistant Secretary (Development), Ministry of Petroleum Industries  Mr. W.R.K. Fonseka, Senior Research Engineer, Industrial Technology Institute, Ministry of Technology and Research  Mr. A.W. Dissanayake, Project Director, Vehicular Emission Testing Programme Office, Department of Motor Traffic

In addition to above, TC decided to co-opt following sector specialists to the committee in order to obtain specialized views.  Dr. D.S Jayaweera, Director General, Department of Development Finance, Ministry of Finance& Planning  Mr. Gamini Gamage, Addl. Secretary (Environment & Policy), Ministry of Environment &Renewable Energy  Dr. A.G.T. Sugathapala, Director General, Sri Lanka Sustainable Energy Authority  Mr. Anura Jayatilake, Director General, South Asia Co-operative Environment Programme  Dr. Ruwan Wijayamuni, Deputy Chief Medical Officer, Colombo Municipal Council  Mr. N.R Amarasinghe, Deputy Refinery Manager, Ceylon Petroleum Co-operation (CPC).  Mr. Ajith Silva, Director, Air Resource Management & International Relations, Ministry of Environment & Renewable Energy

Second Cabinet Decision:

Based on with the recommendations of TC, Hon. Minister of Environment & Renewable Energy submitted a Cabinet Paper No.l3/1329/527/021, dated 2013/08/30. The Cabinet of Ministers has appointed an Officials’ Committee to formulate an Action Plan for the activities with a time frame, key performance indicators and the cost involved by considering the recommendations of the Ministerial Committee. The Official Committee is comprised of the following Officials; - Secretary, Ministry of Petroleum Industries- Chairman of the Officials’ Committee - Secretary, Ministry of Environment and Renewable Energy - Convener and Secretary to the Officials’ Committee - Secretary, Ministry of Technology and Research - Secretary, Ministry of Power and Energy - Secretary, Ministry of Transport

The Official Committee decided to co-opt the following sector specialists to the Committee in order to obtain specialized views.  Mr. V. Amarathunga, Addl. Secretary, Ministry of Transport  Mr. Upali Daranagama, Addl. Secretary, Ministry of Power and Energy  Dr. A.G.T. Sugathapala, Director General, Sustainable Energy Authority  Mr. Anura Jayathilake, Director General, South Asia Cooperative Environment Program (SACEP)  Dr. Ruwan Wijayamuni, Chief Medical Officer, Colombo Municipal Council  Ms. Y.M. Samarasinghe, Addl. General Manager (Transmission), Ceylon Electricity Board  Mr. W.L.A. De Silva, Deputy General Manager, Ceylon Electricity Board  Prof. (Ms.) Padma Amarasinghe, Dept. of Chemical Engineering, University of Moratuwa  Prof. Ajith de Alwis, Dept. of Chemical Engineering, University of Moratuwa  Dr. Parackrama Karunarathne, Dept. of Chemical Engineering, University of Peradeniya  Mr. M.C. Fernando, Director(ES), Sri Lanka Standards Institution  Mr. Ajith Silva, Director, Air Resource Management & International Relations  Mr. W.R.K. Fonseka, Senior Research Engineer, Industrial Technology Institute  Mr. B. Samarasekara, Chief Engineer(General Planning), Ceylon Electricity Board  Mr. A.W. Dissanayake, VET Project Director, Dept. of Motor Traffic  Mr. R.M. Kulasena, Deputy Director, Central Environmental Authority  Mr. N.R. Amarasinghe, Deputy Refinery Manager (Manufacturing & Operations), Ceylon Petroliam Corporation  Dr. Hemantha Herath, Deputy Director, Environment and Occupational Health Division, Ministry of Health  Mr. K.J. Sirikumara, Asst. Director, Sri Lanka Standard Institution  Mr. S.P.R. Liyanapathirana, Asst. Director, Sri Lanka Tourism Development Authority

TERMS OF REFERENCE FOR THE OFFICIALS’ COMMITTEE The first meeting of the Officials’ Committee was held on 31st March 2014 at the Ministry of Petroleum Industries and consented to carry out the following broad activities. 1. Study the TC report on “Enhancing the quality of fossil fuels for managing air quality of Sri Lanka”. 2. Review the activities identified in the above report, and with due consideration of the current issues of the areas of concern, refine the activities further. 3. Study the related government policies, strategies, regulations and development plans, etc. and make recommendations accordingly. 4. Review the technical report and its recommendations prepared by the Ministry of Environment & Renewable Energy and improves the concern areas. 5. Prepare and finalize a time bound action plan for recommended activities indicating:  Responsibilities / Organizations

 Key performance indicators (KPIs)  Cost involved

This report presents the findings and recommendations of the above TC and OC on the enhancement of quality of fossil fuels for managing quality of air in Sri Lanka.

Report Preparation:

 Dr. A.G.T Sugathapala, Director General, Sustainable Energy Authority

Co-ordination and Special Assistance in Report Preparation:

 Sampath Ranasinghe, Environment Management Officer, Air Resource Management & International Relations, Ministry of Environment & Renewable Energy  Ruwan Weerasooriya, Environment Management Officer, Air Resource Management & International Relations, Ministry of Environment & Renewable Energy

CONTENT Page No:

EXECUTIVE SUMMERY 8

1. BACKGROUND 11 1.1 Fuel Quality and Air Pollution 11 1.2 Introduction to Air Quality in Sri Lanka 11 1.3 Overview of Sri Lanka Energy Demand 12 1.3.1 Energy Balance 12 1.4 Transport Energy 14 1.5 Industrial Energy 16 1.6 Government Policy 16 1.7 Renewable Energy Development 17

CHAPTER 2: HISTORICAL ACHIEVEMENTS IN AIR POLLUTION 20 MANAGEMENT IN SRI LANKA 2.1 Vehicular & Industrial Emission Control 20 2.2 Phasing Out of Unleaded Gasoline 21 2.3 Banning Of Two Stroke 3 Wheelers 22

CHAPTER 3: PRESENT STATUS OF FUEL QUALITY AND AMBIENT AIR 23 QUALITY 3.1 World Scenario 23 3.1.1 Impact of Fuel Quality on Vehicular Emissions 24 3.1.1.1 Gasoline Vehicles 25 3.1.1.2 Diesel Vehicles 26

3.2 Status of Air Pollution in Sri Lanka 28 3.2.1 Industry Sector 31 3.2.2 Transport Sector- Vehicular Emissions 32 3.2.3 Emissions of Power Plants 33

3.3 Petroleum Products Supply and Demand in Sri Lanka 35 3.3.1 The Quality of Transport Fuels 38 3.3.2 Current Gasoline and Diesel Fuel Specifications and Quality 38 3.3.3 Crude Oil Refining Process at the Existing Refinery at Sapugaskanda 40 3.3.4 Quality of Gasoline and Diesel Marketed In Sri Lanka 40 3.3.5 Expansion / Modification of the Existing Refinery 41 3.3.6 Existing Barriers in Improving the Fuel Quality 41 3.3.7 Options for Fuel Quality Improvement 41

3.4 Need for Establishment of Independent Fuel Quality Testing Laboratory 43 3.4.1 Objectives of the Fuel Quality Monitoring System 44 3.4.2 Key Elements of Good Fuel Quality Monitoring and Enforcement Program 45 3.4.3 Responsible Authority 45 3.4.3.1 Emission Related Standards for Super Diesel 47 3.4.3.2 Customer Complaints 47 3.4.3.3 Industry Cooperation 47

3.4.3.4 Capacity: Staff and Equipment 48 3.4.3.5 Sampling and Analysis 49

CHAPTER 4:- IMPACTS IN ENVIRONMENTAL, HEALTH AND SOCIO- 50 ECONOMIC SECTORS 4.1 Quality of Fossil Fuels and Impact on the Environment 51 4.1.1 Air pollution control measures 53 4.2 Potential Health Related Urban Air Quality Issues Caused By Low Quality 55 Fossil Fuels 4.3 Economic Analysis for Fuel Quality Improvement 58

CHAPTER 5:- ELEMANTS AND STRATEGIES IN THE FUEL QUALITY 60 IMPROVEMENT ROAD MAP

CHAPTER 6:- RECOMMENDATIONS FOR THE ROAD MAP OF 66 INTRODUCING CLEANER FUELS IN SRI LANKA

CHAPTER 7:- ACTION PLAN OF THE FUEL QUALITY ROAD MAP OF 71 SRI LANKA

REFERENCES 76

Executive Summery

A Road Map for Cleaner Fuels and Vehicles in Sri Lanka is designed to provide decision makers with up-to-date information on how to clean up fuels in Sri Lanka by implementing a set of activities with time-bound targets giving due consideration for regional and international trends in the subject, while addressing the local concerns. Implementation of this road map would help in establishing environmentally sustainable transport (EST) system that lead to a better air quality management in Sri Lanka. As the emission characteristics of a vehicle fleet in an urban environment and resulting ambient air quality degradation are very complex in nature, a comprehensive strategy covering all the facets of the problem is required. Accordingly, this report discusses the interaction between fuels and vehicle technologies and the approaches that existing refinery can take to produce cleaner fuels, and makes recommendations for next line- of-actions. The following are among the key conclusions drawn from this comprehensive study.

(i) Clean fuels are essential. Pollution control experts worldwide have come to realize over the past 30 years that cleaner fuels are a critical component of an effective clean air strategy. In recent years, this understanding of the critical role of fuels deepened and spread to most regions of the world. Fuel quality is now seen as not only essential for directly eliminating or reducing pollutants such as lead, but also as a precondition for introducing many important pollution control technologies (e.g., the lowering of sulfur content to enable use of diesel particulate filters). Further, one critical advantage of cleaner fuels has emerged—its rapid impact on both new and existing vehicles. For example, tighter new vehicle standards can take 10 or more years to be fully effective, but the removal of lead in gasoline in Asia has reduced lead emissions from all vehicles immediately.

(ii) A systems approach is essential. Fuels and vehicles are parts of an integrated system and must be addressed together. The main benefits of reducing emissions will be realized through the coupling of cleaner fuels with cleaner vehicles having advanced emission control technics/devices and regular systematic maintenance scheme. Management of ambient air quality also requires controlling emissions from other sources with significant emission levels through appropriate regulatory actions. In particular, the recently developed stationary sources emission standards should be enforced to complement the vehicle emission control programme to achieve the air quality targets. Hence, it is important to harmonize the source emission standards (both mobile and stationary sources) with the national ambient air quality standards, with the aid of air quality modeling tools, such that the concentration levels of pollutants specified in the standards become logical and realistic. This also requires setting up of ambient air quality monitoring network at strategically identified locations, development of an emission inventory for the country and assessment of socio- economic and environment impacts of air pollution.

Further, promotion of mass transport and non-motorized transport systems together with non- technical interventions such as transport demand management and multimodal planning are vital elements for the establishment of EST system in Sri Lanka.

(iii) Fuel quality and vehicle emission standards should be regulated together. As Sri Lanka has adopted European vehicle (Euro) emission standards to suit the local situation like most Asian countries, European fuel parameters are an important reference point, especially as the fuel quality and emission standards in Europe represent an integrated approach to reducing air pollution from the transportation sector. For example, the advanced emission reduction

8 technologies utilized in the new vehicles are not functioning properly due to high level of impurities in the diesel and petrol oils. High sulfur levels reduce the effectiveness of advanced three-way catalysts for gasoline vehicles and clog particulate filters in diesel vehicles.

(iv) Reducing sulfur is essential. As the lead (Pb) has been already removed, sulfur levels in both gasoline and diesel fuels are the primary fuel parameter to be addressed in Sri Lanka’s fuel road map. Reducing sulfur in fuels is a key measure in reducing air pollution from motor vehicles as well as industrial sources. High sulfur levels reduce the effectiveness of advanced three-way catalysts for gasoline vehicles and clog particulate filters in diesel vehicles. Further, as the new vehicle engines are designed to use low sulfur fuel it is very important and essential to low sulfur diesel and petrol. Therefore it is necessary to use the fuel recommended by the manufacturers to reduce the wear and tear and to control the emissions. Almost all Asian countries will be adopting increasingly stricter Euro emission standards, which require reduced sulfur fuels, with an ultimate goal of 50 ppm or less sulfur in diesel and gasoline. Therefore, it is recommended providing of diesel with maximum of 1000ppm sulphur level by 2015 in Sri Lanka.

(v) The benefits of reducing sulfur are clear. A vast volume of literature based on extensive studies conducted in both developed and developing countries could be found on estimation of impacts of air pollution and also the cost- benefit analysis of different emission control strategies. For example, the United States (US), Mexico, and the People’s Republic of China (PRC) have estimated that the economic benefits of an integrated system of clean fuels and vehicles far outweigh the costs. The estimated benefit cost ratios of these programs are 15:1 in the United States, and 20:1 in the PRC.

(vi) Cleaner fuels are cost-effective and reduce air pollution. In general, air pollution could be reduced by 20% from EURO III fuels compared to EURO II fuel, while reduced by 30% from EURO IV fuels compared to EURO III fuels. Such replacements have high implication on cost of fuel importation and cost of health which includes cost of medicine, and low productivity of labour force. It also found that the present import fuel bill of US $ 5.2 billion in the country can be reduced to US $ 4.3 billion by improving present fuel quality to EURO III which is 5% of total country’s import bill. The impact on budget deficit is also reduced by almost 4 % which cannot be achieved from any other component.

Introduction of cleaner fuels not only reduce the emissions leading to better air quality but also improve the technical performances of vehicles including their fuel economy/efficiency and life. Therefore, net benefits of introduction of cleaner fuels far outweigh the cost associated with the fuel switching. For example benefits of providing cleaner fuels, especially low sulphur petroleum oils (i.e. diesel, petrol, heavy fuel oil - HFO, light fuel oil – LFO, naphtha, etc) in the country includes improvements of public health and environmental impacts on reduction of air pollution attributed non-communicable disease incidents and increase of life expectancy of Sri Lankans. It is important to highlight that the Government of Sri Lanka spends more on health sector development compared to other south Asian countries. It was around 5 percent of total government expenditure during the recent past years while consumed fuel by the transport sector was only US $ 2.9 billion and import bill of fossil fuel for power generation was US $ 2.2 billion. Further the air pollution could be reduced considerably by using EURO III fuels compared to EURO II fuels, and also from EURO IV fuel compared to EURO III fuel. This has high implication on cost of fuel importation and cost of health which includes cost of medicine, and low productivity of labour force.

(vii) Current refinery expansion creates a window of opportunity. The increasing demand for transportation and industrial fuels has necessitated the upgrading or expanding of existing refineries in the country, thereby creating a window of opportunity to produce the clean fuels necessary for reducing emissions.

At present, demand of the auto diesel in the country is 5000 tons/day and existing refinery process produce about 40% of fuel oil with 3.5% sulfur which use in the thermal power plants. It is recommended to upgrade/improve this amount of fuel oil into valuable products like petrol, diesel etc, in the propose refinery expansion/improvement proposal of the Ceylon Petroleum Co-operation (CPC). The gasoline produced in the existing refinery is in par with Euro IV standards. However, at present sulfur extracted during the refinery process is burned into the air since there is no sulfur recovery unit available. Therefore it is highly recommend implementing the existing CPC Refinery Expansion / Modification project as early as possible to provide the proposed fuel standards within the country itself.

(viii) Taxing policy and other incentives are effective. Worldwide experiences indicate that governments can accelerate the introduction of cleaner fuels and their uptake in the fuels market through a balanced and thoughtful combination of tax and pricing policies. Introduction of alternative fuels for Transport – Electric Vehicles and provide attractive tax concessions for promoting smaller hybrid vehicles with higher efficiency in fuel consumption will be highly effective in managing air quality and related issues.

(ix) Establishing an independent Fuel Quality Management Centre must be essential for preventing of Fuel adulterations. Whatever the fuel specifications are adopted in Sri Lanka, it is important to have routine monitoring of the fuel quality at the pump and along the distribution chain to ensure that the actual fuels in the marketplace meet the required specifications by establishing an independent Air Quality Management Committee(AQMC). As the final aim of the fuel quality road map is the air quality management in the country, it is a must to enhance the scope of activities of this committee to cover overall elements in air quality management programme at national level.

(x) All stakeholders should be consulted in the decision making process. The decision making process on the introduction of cleaner fuels should include a dialogue among all stakeholders, including environmental and public health officials, the oil refining sector, vehicle and engine manufacturers, and ministries concerned with oil pricing and taxation.

(xi) It is important to raise awareness about air pollution and vehicle emissions. Intensified awareness-raising at the national and sub national levels are important for making the priority of cleaner fuels is well-understood among all the stakeholders. Efforts in this regard should focus on both decision makers and the general public on vehicle emissions, air pollution and socio-economic & environment impacts.

1. BACKGROUND

1.1 Fuel Quality and Air Pollution

Air is an essential basic need of all of living beings. Since air is abundantly available, it was not treated as a resource in the same manner as land and water. The use of fossil fuels in energy generation for development activities of many countries has resulted severe air pollution issues. In fact, burning of fossil fuel is the most critical sources of pollution, which has a number of potential undesirable effects: high levels of urban air pollution; acid rain and changes in global climate. Among these adverse effects, air pollution continues to pose a significant threat to the environment and the health and quality of life of Asia’s urban population. The World Health Organization (WHO) has estimated that more than 530,000 premature deaths in Asia are due to urban air pollution. Main source of air pollution in many instances is in the transport sector, especially due to excessive use of road vehicles. Over the past 50 years, the world’s vehicle population has grown fifteen-fold, now exceeding 700 million units and will soon reach 1 billion. Most of these vehicles were originally concentrated in the highly industrialized countries, but an increasing number of urbanized areas in developing countries and Central and Eastern Europe are now also heavily congested. While these vehicles have brought many advantages, the benefits have been at least partially offset by excess pollution which has resulted in many effects that endanger the quality of life of current and future generations and carrying capacity of ecosystems. Motor vehicles, including motorcycles, three wheelers, passenger cars, vans and heavy-duty buses and trucks, are almost always a major source of this air pollution in Asian cities. Key emissions from motor vehicles include carbon monoxide (CO), particulate matter (PM), nitrogen oxides (NOX), Sulfur Dioxide (SO2), and volatile organic compounds including unburned hydrocarbons (HC).

Reducing emissions from motor vehicles needs comprehensive strategy covering aspects such as cleaner fuels, cleaner technologies, traffic management and inspection & repair. This study investigates the impacts of introducing cleaner fuels and also the advanced emission control technologies that require these cleaner fuels. A key first step has been the worldwide drive to eliminate lead in gasoline, which has resulted in more than 90% of the world’s gasoline becoming lead-free. It is now time to address all fuel issues, including sulfur in fuel, additives, and other fuel components.

1.2 Introduction to Air Quality in Sri Lanka

Air pollution has now been identified as a growing problem in Sri Lanka as in most other countries in the world. This has been mainly due to rapid motorization and industrialization. Trends in energy consumption show increases in petroleum consumption compared with other renewable sources such as bio fuels and hydropower. Also, Sri Lanka has rapid motorization with huge increase of vehicle fleet during last two decades. The new registration statistics of the Department of Motor Traffic clearly shows the total vehicle population of Sri Lanka has increased by one hundred thirty five percent (135%) during the 10-year period from 2003 to 2012 primarily due to motorcycles and three-wheelers, which is an alarming situation. If no action is taken to clean up fuels and vehicles, urban air quality will continue to decline.

The atmospheric pollution has been highest in the Greater Colombo area, where a significant proportion of the country’s population resides, and most of the industrialization has occurred. The transport sector is contributing about 60% to the air pollution especially in the Colombo

City. Greater dependence on fossil fuels as the sources of energy supplies in various sectors, particularly in the industrial and transport sectors has resulted in increased atmospheric pollution. It has been revealed that the Kandy City air has been polluted more than in the Colombo City mainly due to the mobile sources as the Kandy City is located in a valley.

Further, the rapid economic development and associated higher levels of energy consumption also caused significant levels of air pollution in the cities. The impact of this is aggravated by the fact that the development of industrial and residential areas are completely unplanned within most of these cities with housing is located by the side of industrial installations and visa versa. Such levels of poor planning have exposed the population in these cities to increased risk of air pollution from burning fossil fuels from vehicles, industries etc.

Air quality monitoring in Sri Lanka has focused mainly to the Colombo City where there is an economic and urbanization activities are likewise centered. Air quality monitoring in other cities such as Kandy, Anuradhapura, Puttalam, Kurunegala etc. are very limited.

Government of Sri Lanka spends more on health sector development compared to other south Asian countries. It was around 5 percent of total government expenditure during the recent past years. Research has revealed that ambient PM (PM10, PM2.5, and PM0.1) and SO2 leads to the most significant adverse health effects that are associated with air pollution in Sri Lanka. The other primary vehicular exhaust pollutants in the country include CO, NOX, and HC.

1.3 Overview of Sri Lanka Energy Demand

Sri Lanka at present meets approximately 35 % of its total energy needs from fossil fuels, namely petroleum products and coal. Automobiles, petroleum refineries, thermal power plants (oil and coal), the industrial sector and the domestic & commercial sector are the users of these fossil fuels. Future predictions show that by 2026 oil-based thermal power plants are completely replaced by coal power generation. The population in Sri Lanka grew marginally at an annual rate of 0.7% during the last decade to reach 20.7 million in 2012. 87.7% of the households are receiving electricity from the national grid, operated by the state owned monopoly, Ceylon Electricity Board. 43.7% of the primary energy demand is met using biomass and a 46.3% from imported petroleum fuels whilst the balance is met through other indigenous energy resources, presently dominated by hydropower. With the economic development, the demand for energy is expected to grow in the foreseeable future.

1.3.1 Energy Balance

The country falls into the category of low energy intensity countries, averaging only 542.71 kilo ton of oil equivalent (ktoe) primary energy and 191.84 ktoe commercial energy use per capita per annum. Considering annual per capita electricity and petroleum consumptions of 478.70 kWh and 198.61 kg respectively, commercial energy use can also be seen as low.

The energy balance of Sri Lanka in 2011 can be summarized as follows.

Primary Energy (PJ) 2011 Biomass 207.0 Petroleum 205.8 Coal 13.6 Major hydro 40.4 New Renewable Energy 7.5 Total 474.2

Total Demand (PJ) 2011 Biomass 206.1 Petroleum 128.5 Coal 3.1 Electricity 36.0 Total 373.8

Demand by Sector (PJ) 2011 Industry 91.1 Transport 103.0 Household & Commercial 179.4 Agriculture 0.3 Total 373.8

Source: Sri Lanka Energy Balance 2011, Sri Lanka Sustainable Energy Authority

The country refines approximately 36% of its petroleum products in a government owned refinery, and the balance is imported in the refined forms. Total petroleum consumption stands at 128.5 PJ, which includes fuel for power generation.

The overall energy flow in Sri Lanka in the year 2011 is illustrated in Figure 1.

Figure 1: Sri Lanka Energy Flow 2011 (in thousand toe)

Electricity industry which was dominated by hydropower up to the late 90’s, but now heavily depends on thermal power to meet the rising energy demand. Approximately 59% of electricity is generated from oil, while the balance comes from major hydro and new renewable energy resources. Recent addition of the coal power to the generation system is expected to contribute nearly 20% to the gross generation, which will gradually increase to replace the oil as the main source of power generation fuel. The total installed power generation capacity was 3140.7 MW and serves a peak demand of around 2163.1 MW in 2011. The future of power generation is going to be heavily dependent on coal as depicted below.

50,000

45,000

40,000

35,000 GWh 30,000

25,000

20,000

15,000 Annual Generation Generation Annual

10,000

5,000

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036 2037

Figure 2: The future of Sri Lanka power generation

With the above development, the efforts on managing fuel quality will have to shift from the liquid petroleum fuels to coal in the case of power plant. However, the transport sector will continue to depend on liquid petroleum fuels, and as a result, continued attention to the quality of transport fuels is not to be compromised.

Given the nature of the power industry, the emissions are contained to few stationary locations, which are relatively easy to monitor and control. Every effort must be made to introduce continuous monitoring of emission signatures of all power plants which use some form of fuel for combustion. This aspect has been taken into account in the proposed stationary sources emission standards, enforcement of which becomes an important element in overall air quality management programme in the country.

1.4 Transport Energy

With the Government paying attention to the economic development of all provinces and improved transport infrastructure, the demand for transport services is expected to increase in the foreseeable future.

Figure 3: Transport Energy Demand in Sri Lanka

The transport sector is undergoing rapid changes in fleet structure, with more and more demand is placed on private modes of transport in the context of deteriorating quality of public transport. A marked increase of two wheeler and three wheeler vehicle registrations are indications of this phenomenon. These trends, which are going to affect emissions in a negative-way, are presented in the graph overleaf.

Figure 4: Increasing Vehicle Population in Sri Lanka

A large portion of transport energy is demanded in the Western province, due to the concentration of businesses and other services in the province. With the increased participation

15 in economic development by other provinces, this situation may exhibit a slow change. Given this situation, the emphasis placed on controlling vehicle emissions will have to be further stressed. Policy measures which create a conducive environment for the public mass transportation modes are expected to play a significant role in the coming years, if the transport energy demand is to be managed. Further, promotion of non-motorized transport systems together with non-technical interventions such as transport demand management and multimodal planning are vital elements in reducing fuel intensity in the transport sector of Sri Lanka.

1.5 Industrial Energy

Industrial energy demand is more susceptible to the fuel price fluctuations, but the growth projections indicate immediate return to the long term growth trajectories once the fuel prices recede to low levels. These can be observed across all forms of industrial energy as depicted in the graph below.

Figure 5: Industrial Energy Demand in Sri Lanka

The industrial sector, with large number of small and medium industries and an even larger informal sector is becoming increasingly difficult to monitor and manage, as the globally accepted industrial classifications are not adhered to in Sri Lanka. A concerted effort is required to improve the quality of energy data provided by the industrial sector, before an appropriate benchmarking programme can be launched to monitor and control emissions.

Fuel quality available to the informal sector requires special attention, given the circumstances prevalent such as adulteration and dilution with spent lubricants etc. are considered. In future, specific measures are called for, to closely monitor the small and medium sector and the informal sector through a routine plant inspection programme.

1.6 Government Policy

Government of Sri Lanka is keen on extending the grid electricity to the total population by year 2014 through grid and off-grid means. Already, 87.7% of households get grid electricity on 24x7

16 basis, and the grid served households will continue to increase to over 95% by end 2013. The remaining population will receive electricity using mini grids and stand-alone systems utilizing energy from renewable resources such as solar and micro-hydro.

Development of all renewable resources using public and private investments is high on the priorities and will focus on hydro, wind, biomass and solar sectors. Private sector will be encouraged to develop renewable energy resource less than 10 MW under SPPA model with declared technology specific feeding-tariff and resources with larger capacities (greater than 25 MW) will be jointly developed by the public and private sector.

There are two ongoing policy initiatives at present, which will provide a highly conducive environment for renewable energy development. These initiatives are:

(i) Development of a comprehensive national energy policy which propose measures to increase energy security, improved energy efficiency and more reliance on indigenous energy resources. The draft policy is now before a group of key stakeholders for review.

(ii) Preparation of a renewable energy development plan (or road map) which aims at generating complete value chains to harness the natural resources for economic development, including the creation of high skill employment opportunities.

1.7 Renewable Energy Development

Sri Lanka is blessed with impressive hydro, solar, wind and biomass resources and some of these resources are developed to commercial levels, and others are in various stages of development. The achievements of the new renewable energy (NRE) sector are presented Table 1 below.

Table 1: The achievements of the new renewable energy (NRE) sector

Project in Operation Projects with EP Projects Type No. MW No. MW

Mini Hydro 95 206 117 209

Biomass Dendro 1 0.5 15 85.5 Biomass-Agricultural & 2 11 4 6 Industrial Waste Waste Heat Recovery 1 0.1 - -

Solar 3 1.36 - -

Wind 8 48.85 6 74.15

Total 110 267.81 142 374.65

Hydro: Medium capacity hydro potential is developed to a capacity of 1,357MW and there are few more potential sites awaiting development with a capacity around 150MW. Small hydro potential is being developed to around 210MW, and there are around 375MW of resources awaiting development.

In addition, there are around 300 micro hydro powerhouses operating in the island, capacities ranging from few hundred watts to 60kW, providing power to communities either through mini grids or as standalone units.

Wind: There is a 3MW pilot wind power plant in the island connected to the national grid, owned by the Ceylon Electricity Board, in operation from 1998. After many years, private sector commissioned the first commercial scale power plant in 2010, adding a 10MW capacity to the national grid. At end 2012, there were nearly 60MW of operating power plants in the national grid and around 40 MW are under construction. A proposal to develop 100 MW wind power farm in Mannar island is under development. Several standalone wind powered battery-charging stations operate in isolated communities as a pilot project, with unit capacities ranging from 100W to 250W. Two community wind systems are also operational, one in a remote west coast island and the other in southern coastal area.

The total meteorological potential of all the promising sites is a staggering 25,000MW. Wind resource assessments carried out by NREL atmospheric scientists indicate that certain lagoon areas and highland zones can accommodate a capacity of more than 2500MW, which are rated as 'best sites available' anywhere in the world. Data collection for validation of the satellite data using ground measurements is presently underway.

Biomass: Considering the dominance of biomass on the national energy balance, there had been attempts to develop the production of fuel wood as an industry. The trial plantations have indicated that a hectare of marginal land can produce 25,000kg of dry matter per annum 15 months after establishment, on a continuous basis.

In view of the availability of large extents of marginal land, several plants using gasifier and steam boiler technologies have been planned, with capacities ranging from few hundred few kWs to 10 MW. Larger plants using biomass direct combustion / steam boiler - turbine technologies with their higher efficiencies are expected to play a leading role in future developments.

At present, two grid connected power plants of total installed capacity 11.5 MW (10 MW and 1.5 MW) have been in operation among which the smaller plant is yet to reach the full capacity due to technical issues. Further, number of off-grid community based power plants with aggregate capacity of over 20 kW were installed but majority of them are not in successful operation.

Solar: Being a tropical country with plenty of sunshine, Sri Lanka uses solar energy primarily in agro processing activities such as drying. Solar resources assessment carried out simultaneously with the wind resource assessment is expected to provide a sound database of solar resources in the near future.

Solar PV technology was introduced to Sri Lanka during 1980s is accepted widely in remote dry zone farming communities. Standalone solar home systems with powers ranging from 10 W to 100 W power approximately 167,000 households as at end 2011. This figure is expected to decline due to the rapid expansion of the national grid. There is a pilot grid connected solar PV power plant in operation since 2001 as a demonstration model with a capacity of 30kW. In

2011, the first grid tied solar power plant was commissioned by the Sri Lanka Sustainable Energy Authority as a pilot project, adding 1.24 MW of capacity to the national grid.

In addition to the above four renewable energy resources, there are indications of availability of geo-thermal and ocean-thermal resources, but detailed resource assessments are yet to be carried out for the identification of the technical and economic potentials.

CHAPTER 2

HISTORICAL ACHIEVEMENTS IN AIR POLLUTION MANAGEMENT IN SRI LANKA

2.1 Vehicular & Industrial Emission Control

Reducing emissions from motor vehicles is an important component of an overall strategy for reducing air pollution. One essential approach to reducing air pollution caused by vehicle emissions is to eliminate lead from gasoline in year 2003. Formulation of vehicle emission standards was also taken place in 2003. Prohibition of importation of two stroke three wheelers also contributed a significant ambient air quality improvements in the country. Formulation of fuel quality standards was completed in 2003 with stepwise improvements to cater for the deteriorating ambient air quality arisen from emissions of increasing vehicle fleet in the economic development process. In addition to above, there were several fiscal policy decisions taken in time to time by increasing custom duties of smaller vehicles and reducing duties of electric and hybrid vehicles to reduce the air pollution caused by vehicles. Figure 6 shows the model share of passenger km in millions contributed to total passenger transport requirements in 2010

Modal Share of Passenger km 2010 (Million Pkm) Projected Active Fleet 2010

12,596 11%

8,742 12% 2% Motor Cars Dual Purpose 8,272 56% 6% Buses 53,486 Two wheelers 13.4% 5% Lorries Three wheelers 9.3% 10,904 Land Vehicles Private cars 8.8% 8% Three Wheelers Dual purpose vehicles 11.6% Motor Cycles Private Buses 56.9%

Figure:-6. Model share of passenger km and projected active fleet in 2010 Source: Sri Lanka Sustainable Energy Authority

This figure gives an indication of the total pollution loads from each vehicle category based on their active fleet and shows the contribution to passenger transport demands. Therefore, regulations, standards as well as policy improvements are highly important to manage the ambient air quality in the country.

For the control of air pollution from industry sector, the Central Environmental Authority has set out the stationary source emission standards and all the industrial sector pollution loads are expected to be controlled through these standards. Another important point is that one of the factors considered in the development of these standards is fossil fuel quality used in energy sources of the industrial processes. With the existing fuel quality levels in Sri Lanka, it is also difficult for industrial community to manage their emissions within the standards. Specially, the sulphur content in fossil fuel contributes significantly for the industrial air pollution by generating sulphur dioxide in large quantities.

It is proposed to strengthen the vehicle emission standards to reduce air pollution caused by motor vehicles as the present standards are very basic and less-stringent. But introduction of

20 more stringent vehicle emission standards will not guarantee the improved ambient air quality in the country without enforcing the fuel quality improvements.

Further to above, use of poor quality fuel to propel modern vehicles is contributing to economic losses associated with replacement and repairs of corroded engines and parts due to use of poor quality fuels. Therefore, fuel quality improvement is in utmost importance in transport sector of the country. In addition, as per with MAHINDA CHINTHANAYA Development policy framework in Sri Lanka, prepared by Department of National Planning , Ministry of Finance and Planning, it has been targeted to reduce the annual average PM10 particulate matter (particulates of aerodynamic diameter less than 10 micro meters) concentration to the value of 40 mg/m3 by year 2016. With effects of previously implemented air quality management interventions, it was able to reduce to the value of 64 mg/m3 in 2011 from around 75mg/m3 in year 2002 (source: Central Environmental Authority).

In considering whether to adopt the approaches in controlling emissions, policymakers in the country should weigh several factors, including the impact of the vehicle emission to urban air pollution as well as the comparative costs and benefits of introduction of cleaner fuels and other available pollution control strategies.

2.2 Phasing out of Unleaded Gasoline

It is known that prior to the elimination of lead in gasoline, eighty to ninety percent of lead in air is from automobile emissions. Lead is a cumulative, protoplasmic poison that affects health in numerous ways. The best known hazard is its effect on the neurodevelopment of children. Following the widely publicized and pioneering research of Needleman this is known to take place even at low levels of exposure. During the period of leaded gasoline used in Sri Lanka, it was found in a study that blood Lead levels are high in Colombo Traffic Policemen (see Figure 7).

Figure 7: Blood Lead Level in Colombo Traffic Police Officers in 1998

In June 2002, Sri Lanka shifted completely to unleaded gasoline and the entire SAARC region is now “lead free” from gasoline additives. As shown in Figure 8, the air quality measurements in Colombo carried out by National Building Research Organisation has demonstrated a drastic 21 drop in road-side atmospheric lead. Significant change occurred in blood lead levels of children as a result of this lowered atmospheric lead, indicating the enormous benefits of the use of cleaner fuels.

Figure: 8. Reduction of Colombo Roadside Lead Levels after 2002 June Source: National Building Research Organisation

2.3 Banning of Two Stroke 3 Wheelers

Recognizing the growing problem of urban air pollution associated with the use of three wheelers with two stroke engine technology, the Cabinet of Ministers at its meeting held on 22.01.2007 has approved the following recommendations made by the then Minister of Environment in his Cabinet Memorandum number 001/2007 dated 04.01.2007 under the title "Improving the Urban Air Quality by regulating the use of Two Stroke Three Wheelers". (i) To direct the Controller of Imports and Exports a) to prohibit import of three wheelers powered by two- Stroke petrol engines with effect from lst January 2008 and b) suspension of import of the full engine by lst January 2011 c) engine block and cylinder head by lst January 2013 in order to avoid local assembly of two stoke engines (ii) To grant a grace period of six (06) months for registration of three wheelers powered by two-stroke engines imported prior to 1st January 2008; and (iii) To direct the Commissioner of Motor Traffic to suspend registration of three wheelers powered by two-stroke petrol engines with effect from 1st July 2008. This intervention too contributed significantly to the improvement of urban air quality and reduction of the impacts of air pollution in the transport sector

CHAPTER 3

PRESENT STATUS OF FUEL QUALITY AND AMBIENT AIR QUALITY

3.1 World Scenario

Major Asian cities are among the most polluted in the world; 13 of the 15 most polluted cities in the world are from Asia. Main reason for the urban air pollution is the continued growth in vehicle population to cater for the increasing demand for mobility. There are some significant improvements in fuel quality in the last decade in the region. One of the major achievements is lead phase-out from the gasoline. However, fuel quality monitoring legislations are lacking in many countries in the region including Sri Lanka. Due to the socio-economic situations, several countries including Sri Lanka have introduced different subsidies depend on the fuel types, which in turn has influenced the characteristic of the vehicle fleet (i.e. number and type of vehicles). As these subsidies usually introduced without considering the fuel qualities and associated impacts, there are many instances where the expected benefits have been at least partially offset by excess pollution. Therefore, the fuel quality plays a vital role in determining the real impact of the transport sector to the socio-economic development of a country. In this respect, it is not easy to compare the situation in different countries as in general the fuel quality is not harmonized among the countries.

The biggest air quality problem in developing countries is air pollution in urban areas. The World Health Organization (WHO) estimates that almost 800,000 people die prematurely each year from urban air pollution. Most of these premature deaths occur in developing countries. As vehicle traffic grows, the health and economic toll of poor air quality continues to mount on the most vulnerable of residents: women, children, and the elderly who either live, play, walk and work on or close to congested urban highways. Vehicle emissions are one of a number of contributing factors to poor urban air quality. In terms of the health impacts, four pollutants are of particular concern – particulate matter (PM), ozone (O3), carbon monoxide (CO), and sulphur oxides (SOX). Like lead, emissions of sulfur compounds cause serious human health and environmental concerns. More importantly, sulfur inhibits the use of advanced technology to control total pollutant emissions, including NOx, HC, CO, and PM. Reducing sulfur levels in fuels will decrease the vehicle emissions of smog precursors and other pollutants that foul our air and choke our lungs.

Government policies to prevent the use of lead in fuel have been implemented in most countries and are providing tremendous health benefits. Similarly, low-sulfur fuels can become the rule creating cleaner air, improving public health, and reducing environmental problems. Often, fuel sulfur standards are coupled with stricter emissions standards for new vehicles or retrofit programs to reduce emissions in existing vehicles. Figure 9 illustrates the global status of the sulfur levels in diesel fuel.

Figure 9: Global status of the diesel fuel sulfur levels

Any reduction in sulfur reduces the SO2 and sulfate emitted and, as sulfur levels decline past a certain point, the benefits increase to include total pollutant emissions. Reduced sulfur fuel (~150 ppm) makes existing vehicles cleaner. Low sulfur fuel (~50 ppm) allows for advanced particulate filter and NOx control technologies to further restrict pollutant emissions. And near- zero sulfur fuel (~10 ppm) enables tremendous advances in fuel efficient vehicle design and advanced emissions control technology.

Reducing sulfur has its costs. Unlike lead, a fuel additive, sulfur is a naturally occurring component of crude oil and some types of sulfur compounds can be more easily (and cheaply) removed than others. Upgrading refineries to remove sulfur is expensive and increases greenhouse gas emissions, despite the development of new catalysts and novel processes which reduce the energy requirements and costs. Yet, weighed against the emissions reduction potential of low-sulfur fuels, studies show the benefits far outweigh the costs.

3.1.1 Impact of Fuel Quality on Vehicular Emissions

Motor vehicles continue to be the dominant source of air pollution, despite tremendous advances in engine technology and pollution control. In industrialized countries, even as cleaner vehicles are replacing older, dirtier ones and total transportation emissions are beginning to decline, vehicles are still the most important source of air pollution.

Meanwhile, in the developing world, vehicle numbers are growing exponentially and, without strict control standards in place, emissions from transportation sources are becoming an increasingly urgent concern. As shown in Figure 10, vehicle numbers in developing and developed countries, and thus pollutant emissions, could exceed vehicle numbers in the industrialized world within the next two or three decades.

Figure 10: Increasing Motorization and Vehicle Growth

Motor vehicles are a significant source of CO, HC, and PM, all of which are produced through inefficient or incomplete combustion. In addition, motor vehicles are one of the most important sources of NOX, which along with HC, are the essential precursors to ground-level O3, the main component of photochemical smog. All of these conventional pollutants have important local human health and environmental impacts, and there is increasing understanding of their global significance as well. Vehicles are also an important and growing source of carbon dioxide (CO2), the principle greenhouse gas contributing to global warming. While transportation is less significant as a direct source of SO2, removal of sulfur from gasoline and diesel fuels will be critical for the control of other vehicle emissions.

3.1.1.1 Gasoline Vehicles

Most gasoline vehicles currently in use are equipped with catalysts for the control of CO, HC, and NOX, which are impacted by sulfur levels in the fuel. The sulfur impact increases in severity as vehicles are designed to meet stricter standards. Current sulfur levels in fuel are the primary obstacle in bringing advanced emission control technologies to market. These technologies will dramatically reduce conventional pollutants and also enable more fuel- efficient engine designs.

Worldwide, 85% of new gasoline vehicles are equipped with a three-way catalyst (TWC), which simultaneously controls emissions of CO, HC, and NOX. Vehicles with TWCs must operate with a very exact air-to-fuel ratio, allowing just enough O2 to fully oxidize the carbon and hydrogen in the fuel. The TWCs then use the NOX in the exhaust to oxidize the CO and HC to CO2 and H2O, while the NOx is reduced to N2. Sulfur levels in fuel impact TWC functioning in several ways. These include:

I. Fuel sulfur reduces conversion efficiency for CO, HC and NOX. Sulfur competes with these gaseous emissions for reaction space on the catalyst. It is stored by the TWC during normal driving conditions and released as SO2 during periods of fuel rich, high- temperature operation, such as high acceleration (Maricq et al., Gasoline, 2002).

II. Sulfur inhibition in catalysts is not completely reversible. Although conversion efficiency will always improve with return to reduced sulfur levels, the efficiency of the catalyst does not always return to its original state after desulfurization.

III. Sulfur content in fuel contributes to catalyst aging. Higher sulfur levels cause more serious degradation over time and, even with elevated exhaust temperatures, less complete recovery of catalyst functioning (MECA 1998).

3.1.1.2 Diesel Vehicles

In diesel vehicles, reducing sulfur not only reduces SO2 emissions, it also significantly reduces particle emissions. In the oxygen-rich exhaust of diesel vehicles several percent of the SO2 formed during combustion is oxidized to SO3, which dissolves in the water vapor present to form sulfuric acid (H2SO4) vapor. H2SO4 is one of the few substances that are capable of homogenous nucleation. This appears to be a major mechanism for initiation of ultrafine particle formation in diesel exhaust, producing newly formed particles of around 1 nm (Shi and Harrison 1999). Even though sulfate particles account for only a small fraction of particle volume or mass, they account for a large fraction of particle numbers. And sulfate nano- particles provide a relatively large surface area onto which HC species condense, resulting in particle growth and increasing particle toxicity (Shi and Harrison 1999).

Even without the benefit of additional emissions controls, reducing sulfur levels in diesel fuel reduces both PM emissions and the carcinogenic and toxic effects of the particulate matter formed (Bünger et al. 2000). A variety of tests have supported this conclusion. In Denmark, a reduction in fuel sulfur levels from 440 to 0.7 ppm led to a 56% reduction in numbers of particles emitted from diesel vehicles (Wåhlin et al. 2001). Tests on Japanese diesel trucks have demonstrated that a reduction in fuel sulfur from 400 to 2 ppm cuts the mass of PM emissions in half (WWFC 2000). In heavy-duty diesel trucks in U.S., a decrease in fuel sulfur from 368 to 54 ppm yielded a 14% reduction in PM emissions (MECA 1999).

In addition, SO2 emissions can lead to secondary particle formation—particles that form in the ambient air. EPA models predict that over 12% of the SO2 emitted in urban areas is converted in the atmosphere to sulfate PM (Darlington and Kahlbaum 1999). This means that diesel and gasoline on-road vehicles in the U.S. may be responsible for up to eight times the PM emissions that are accounted for in inventories for direct diesel emissions (EPA 2001). Urban areas would benefit most from reductions in SO2 emissions, as polluted urban air has higher concentrations of the constituents that catalyze the SO2-to-sulfate reaction. Even with existing vehicle stocks, reductions of fuel sulfur levels would have a significant impact on primary and secondary PM concentrations in urban areas.

Table 3: Sulfur Impacts on Emission Control Technologies

3.2 Status of Air Pollution in Sri Lanka

Annual averages of ambient PM10 level in Colombo over the years have remained relatively uniform within the range of 60 to 82 µg/m3 with a slight decreasing trend from 1998 to 2011. The peak was recorded in 2001(Figure 11). It was observed that a sharp decrease in 2009, but again started to increase. These values, however, consistently exceeded WHO latest guideline 3 value of 20 µg/m for PM10. Thus Colombo city is very unhealthy in terms of its particulate pollution. However, there is a slight decreasing trend of PM10 from 1998 to 2006.

Annual averages of PM-10 at Colombo Fort Monitoring site (1998-2012)

100

10 75 PM PM 50 µg/m3 25

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Year

Figure11: Annual averages of PM-10 at Colombo Fort ambient air quality monitoring Station (1998-2011) Source: Central Environmental Authority

Ambient air quality levels of NO2, SO2 and PM10 were monitored in Kandy and Nugegoda city areas in July 2008. The maximum value of 24 hourly average was recorded as 96 µg/m3 at Nugegoda while 75 µg/m3 at Kandy (see Figure 12 and Figure 13).

Figure 12: PM10 24-hour average concentrations at Nugegoda in Sri Lanka Source: Central Environmental Authority (Year2012)

Figure 13: PM10 24-hour average concentrations at Kandy in Sri Lanka Source: Central Environmental Authority

Ambient air quality levels of NO2, SO2 and PM10 were monitored in major cities on Padeniya, Anuradapura road for 24 hour periods at each location in July 2009. The maximum value of 24 hourly averages was recorded as 52 µgm-3 at Galgamuwa town (see Figure 14).

Figure 14: PM10 24-hour average concentrations at selected locations at Padeniya Anuradapura road in Sri Lanka Source: Central Environmental Authority

Figure 15: Minimum, Mean and maximum of one-hour averages of SO2 concentrations at selected locations in Sri Lanka Source: Central Environmental Authority

Figure 16: Minimum, Mean and maximum of one-hour averages of CO concentrations at selected locations in Sri Lanka Source: Central Environmental Authority

Figure 17: Minimum, Mean and maximum of one-hour averages of NO2 concentrations at selected locations in Sri Lanka Source: Central Environmental Authority

Figures 15 to 17 show the SO2, CO and NO2 concentrations in ambient air in three different cities. According to these figures, the high air pollutants concentrations were recorded in Nugegoda and Kandy with high PM10 concentrations were recorded in Colombo Fort monitoring station. 24-hour average concentrations of PM10 in Colombo, Nugegoda and Kandy were below Sri Lankan National Standard 100 μgm-3 while exceeding the WHO guideline value of 50 μgm- 3 . It was observed that PM10 concentrations at Nugegoda and Kandy city areas were marginal to the Sri Lanka National Standard 100 μgm-3. Considering the other parameters, high concentration were recorded in traffic congested highly populated Kandy and Nugegoda City areas. Also it is observed that all roadside locations at Padeniya Anuradhapura road were recorded fairly high concentrations. Among these locations highest concentrations were recorded at Galgamuwa city area with high traffic populated. Sooriyawewa is the remote location at Hambanthota district. Very low concentrations of all parameter were recorded at Sooriyawewa due to little sources with low traffic movements.

Dust/Soot is the major source of air pollution in Sri Lanka. In addition to dust, fairly high concentrations of SO2 and NOX were reported. Major cause of this kind of air pollution is mobile sources. Figure 18 shows the net energy inputs for different energy demand by the sectors and it implies that transport sector become the most responsible source of pollution by burning highest percentage of fossil fuels in the country.

Figure 18: 2010 commercial Energy Demand by Sector (ktoe) Source: Sustainable Energy Authority

Therefore it is a must to maintain good fuel quality used in transport sector to maintain good air quality status and thereby assuring healthy air for breath.

3.2.1 Industry sector

Within the last decade, industrial activity in Sri Lanka has grown at a relatively rapid pace. Air pollution due to industrial sources has increased proportionately. Air pollution problem arisen in Sri Lanka from industrial activities mainly due to lack of using of air pollution control measures and also lack of consideration of environmental problems at the planning stage. Most industries, which were established prior to 1980, use outdated technology without proper pollution control measures incorporated. Many of these find it difficult to adopt new technology or pollution control equipment due to limitations in financial resources, knowledge & expertise and lack physical space for installation of pollution control devices.

Commonly used fuels in the Industrial sector include electricity, furnace oil, diesel, and firewood. Emission of Carbon dioxide occurs in various industrial processes including cement and lime manufacture, petroleum refining and handling, activated carbon manufacture, etc. Therefore the air pollutants from industry can be categorized into two types: emissions associated with processing of raw materials (e.g. cement dust or lead particulates from lead smelting furnaces or again acid fumes and mist from acid processing plants) and emissions from energy generation processes (i.e. in furnaces and boilers). While urban industries are mostly confined to fossil fuel, agro-industry and certain manufacturing industries in rural areas mostly use biomass fuel.

As the distribution of the industries is concerned, most of the manufacturing sector industries are concentrated in Kandy, Gampaha and Colombo districts. Air pollutants from various industries include suspended particulate matter (SPM), carbon dioxide, oxides of sulphur and nitrogen.

3.2.2 Transport sector - Vehicular emissions

Rapidly increasing vehicle population and fuel consumption, particularly diesel, high proportion of old vehicle usage in transportation and poor vehicle maintenance, absence of clean fuel and high rate of urbanization are contributing factors to high pollution levels in Sri Lanka which is significantly higher than recommended health standards. The energy requirement of the Sri Lankan Transport Sector is entirely met through petroleum fuels.

Figure: 19. Increasing Cumulative Vehicle Registrations in Sri Lanka Source: Department of Motor Traffic

Figure 20: Different types of fuels used in the road transport sector in Sri Lanka Source: Sri Lanka Energy Balance 2010 - SLSEA

Automobile exhaust is a major source of air pollution in Sri Lanka. Existing evidence has shown that the urban environment of Colombo is heavily contaminated with vehicular emissions. Various studies undertaken by regulatory agencies and researchers clearly indicate that inefficient combustion of petroleum oil in motor vehicles is the primary cause of growing air pollution in Colombo, the largest metropolitan area with nearly 50% of the vehicle population is on the move and 30% of the nation’s human population dwells. The observed lead, total suspended particulates (TSP), SO2, and O3 levels are significantly higher than the levels recommended by the WHO and the CEA of Sri Lanka. It has been found that among the major sectors contributing emissions of air pollutants to the atmosphere from petroleum– derived combustion sources (transport, industry, power and domestic) approximately 75% of SPM, NOX, HC, CO originates from the transport sector.

3.2.3 Emissions of Power Plants

Emissions from thermal power generation has significant contributor of air pollution in Sri- Lanka as furnace oil and diesel used for power generation has more than 10,000 ppm of sulfur. Over 95% of the country’s electricity requirements in 1995 were obtained from hydroelectric schemes. The scenario has rapidly changed during the last few years due to increasing demand and prevailing droughts, the thermal power plants have taken over the generation of around 40- 50 % of the national requirement. Current hydroelectric power production has reached saturation point at approximately 4000 GWh annually. Power requirements are expected to double over the next decade. To meet this increased energy demand the government’s preferred option is the installation of more fossil fuel power plants. The total installed capacity of thermal power plants is about 1400 MW in the year 2010. The first coal fired power plant in Norochcoloi , Puttalam came into operation in 2011. This adds 300 MW at its first phase of operation. Fuels usage in power generation (Furnace oil, Diesel & Naphtha) in Sri Lanka is shown in Figure 21.

Figure 21: Different types of fuels used in power generation sector in Sri Lanka Source: Sri Lanka Energy Balance 2010 - SLSEA

600 16

450 12

(X10

& NO & 300 8 2

Emission Emission of SO

Fuel Usage for Fuel Electricity(X1000)MTUsage 150 4

0 0 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 Year SO2 NO2 Auto Diesel Furnace Oil Naphtha

Figure 22: Fuel consumption and emission of NO2 and SO2 –Sri Lanka power sector Sources: Central Bank Reports 1991-2003 and Statistical Digest of CEYPETCO and CEB 2002, 2003

Thermal power generation has increased in Sri-Lanka to fulfill increasing demand because hydroelectric power was constrained by unfavorable weather conditions. Figure 22 above shows that increasing amounts of SO2 and NO2 with respect to fuel consumption. High concentration of sulfur (3.5% maximum) in furnace oil is responsible for high sulfur dioxide levels in thermal power generating areas in Sri-Lanka.

Among the major sectors contributing emissions of air pollutants to the atmosphere from petroleum–derived combustion sources, approximately 75 -80 % of SO2 originate from mainly thermal power plants and the petroleum refinery. The western province in Sri-Lanka (The area including the districts of Colombo Kaluthara and Gampaha) commonly known as Colombo Metropolitan Region (CMR) was identified as most vulnerable area of air pollution. Kandy town area, Galle, Kurunegala, and Puttalamwhere identified as other air pollution hot spots in Sri-Lanka.

Table 4: Input data- Source Characteristics

Source: NBRO prepared power sector emission inventory and EIA report of Thermal Power Plants

3.3 Petroleum Products Supply And Demand in Sri Lanka

Following petroleum products are used as energy sources in different sectors in Sri Lanka. Total requirement is nearly 4 million tons.

LPG -Domestic / Industry / Transport SBP -Industry Petrol – 90 RON - Transport Petrol – 90 RON - Transport Aviation Gasoline - Transport Naphtha - Power Jet A1 - Transport Kerosene - Domestic / Industry Super diesel (0.05% S) -Transport Auto diesel (0.3% S) -Transport / Power HS diesel (0.5% S) - Power F.O.800’ - Industry F.O.1500’ -Industry/Power Low Sulphur F.O.1500’ -Power F.O.3500’ -Power

These products are supplied partly by processing imported Crude oil at the oil Refinery at Sapugaskanda and balance by importing directly as refined products. In addition, Lanka Indian Oil Company (LIOC) also distributes Gasoline and Diesel through their outlets in the Country.

The following graphs illustrates the price difference and fluctuation between high Sulphur (0.3%) and low Sulphur (0.05%) diesel at the Singapore oil market in year 2012.

Figure 23: Price difference between super diesel and normal auto diesel 2012. Source: Singapore Platt’s prices

Figure 24: Price difference between LSFO and HSFO 2012. Source: Singapore Platt’s prices

Imported petroleum represents approximately 85 % of Sri Lanka’s commercial energy demand and the balance comes from hydropower. The total petroleum demand increased by 27.5 % from year 2000 to 2010 with an average annual growth rate of 2.75 %.

Table 5: Present country’s fuel consumption

Fuel Type Average Daily consumption (MT) Petrol(90 OCT) 1900 Petrol(95 OCT) 100 Diesel(0.25% Sulfur) 4450(Without Power Plants) Diesel(0.05% Sulfur) 100 Jet A-1 800 36

Kerosene 1290 LSFO 1000(Kerawalapitiya power plant only) HSFO 2150(Other power plants and Industries.) Naphtha 300

As this consumption is growing yearly, environment impact is also increasing. The predicted consumption is given below.

Figure 25:- Sri Lanka Oil Demand Forecast. Source: CPC

When CEB utilizes their thermal diesel power plants, diesel consumption is increased seasonally. However, energy sector has considered moving forward primarily with Coal and possibly with LNG too in the future. These trends also should take in to consideration when forecasting oil demand.

Figure 26:- Fuel requirement to meet the increasing electricity demand. Source: CEB

However, with the increase of vehicle population and industrial fuel demand, the Sri Lankan market for oil practically impossible to satisfy with a single refinery with the present capacity. If this trend is not reversed, Sri Lanka will become increasingly dependent on imports, and, in the long range, the viability of the refinery may become questionable.

3.3.1 The Quality of Transport Fuels

The fuel quality parameters that should be considered in controlling vehicle emissions and air quality was discussed briefly in the first chapter of this report. The main parameters include:

- for gasoline: lead, benzene, total aromatics, front-end-volatility (RVP), sulphur. - for diesel fuels: sulphur content, T95, Cetane Number/Index, density, poly-aromatics.

The refinery crude slate, the refinery configuration, the operation severity of the key refinery processes, and the relative demands of the various products are all essential features that influence product quality.

3.3.2 Current Gasoline and Diesel Fuel Specifications and Quality

st The existing fuel specifications were introduced on the 1 of January 2003, as required by the rd extraordinary issue of the 23 of June 2000 of The Gazette of the Democratic Socialist Republic of Sri Lanka (No. 1,137/35).

Tables 6 and 7 below list the current Sri Lankan specifications for gasoline and diesel fuels, respectively:

Table 6: Specification for Petrol

Specifications

Property/Test 90 Octane 95 Octane Clear & free from water and Clear & free from water and Appearance impurities impurities Density @15 0 C kg/m 3 725- 785 725- 785 Reid Vapour Pressure @37.8 35-70 kpa** (5.0 - 10psi) 35-70 kpa** (5.0 - 10psi) 0 C (100 0 F) Marketing Colour Pink Pink Octane Number (RON) Min 90 Min 95 (RON+MON)/2 Min 89 Min 89 Distilliation

IBP o C To be reported To be reported 10% Vol. Evoporated 0 C 45-70 45-70 50% Vol. Evoporated 0 C 80-125 80-125 70% Vol. Evoporated 0 C Max 188 Max 188 90% Vol. Evoporated 0 C Max 215 Max 215

Res % Mx 2.0 Mx 2.0 Doctor Test Sweet or less than 15ppm RSH Sweet or less than 15ppm RSH Total Sulphur content %wt Max 0.10 Max 0.10 Lead content Pb mg/l Max 13 ppm Max 13 ppm Existent gum mg/100ml Max 5 Max 5 Oxygenate content Vol % Max 15 Max 15 Ind period @ 100 0 C Min 480 Minutes Min 480 Minutes Cu Strip corrosion 3 hrs @ 50 Max 188 Max 188 0 C Benzene % vol Max 8.0 Max 8.0

Table 7: Specification for Auto Diesel

Specifications Property/Test Auto Diesel Super Diesel Clear & free from water Clear & free from water and Appearance and impurities impurities Density @15 0 C kg/m 3 820 - 860 820 - Max 870 Colour ASTM Report Report Marketing Colour Amber Amber Distilliation

IBP o C Report Report (196 - 204) 10% Evoporated 0 C Report Report (245 - 245) 50% Evoporated 0 C Report Report (288 - 294) 90% Evoporated 0 C Max 370 Max 340 Recovery @ 315 0 C Min 50 Min 50 Recovery @ 350 0 C Min 80 Min 80 Cetane Index or Min 46 ** Min 50 ** Cetane Number Min 49 Min 53 Cloud Point 0 C ( 0 F) Max 15.5 (Max 60) Max 15.5 (Max 60) CFPP 0 C ( 0 F) Max 10 (Max 50) Max 10 (Max 15) Sulphur Content % (w/w) Max 0.3 Max 0.05 Total Aromatic content 25

Cu Strip corrosion 3 hrs @ 50 0 C Max 188

Poly Aromatic content ( di+tri+)%m/m 5

Flash Point (PMCC) 0 C ( 0 F) Min 60 (Min 140) Min 60 (Min 140)

Viscocity Kin @37.8 0 C cst 1.5 -5.0 1.5 -5.0 Water Content % (v/v) Max 0.05 Max 0.005 Cu Strip corrosion 3 hrs @ 50 0 C Max 1 Max 1 Ash % w/w Max 0.02 Max 0.02 Carbon residue Ramsbottom on 10% residue % (w/w) Max 0.3 Max 0.3 Sediment by extraction % (w/w) Max 0.01 Max 0.01 Total Acid No. KOH mg /g Max 0.2 Max 0.08 Strong Acid No. KOH mg /g Nil Nil Caloric value gross K Cal/KG Min 10500 Min 10500 Poly Aromatic content ( di+tri+)%m/m 5

**N/A if any cetane improver additive is present 5

3.3.3 Crude Oil Refining Process at the existing Refinery at Sapugaskanda

Existing oil Refinery at Sapugaskanda was originally designed in 1969 to process 38,000 Barrel / day of Iranian Light Crude oil from Iran to meet the national demand of Petroleum products. However, several light crude oils from other countries like Saudi Arabia, Oman, Abu Dhabi, Kuwait, Iraq, and Egypt could also be processed at the Refinery meeting product specifications prevailed at that time. With the increase in demand, refinery capacity was increased to 50,000 Barrel/ day (6900 MT/day) in 1979. In 1992, main unit of the Refinery was revamped to add more flexibility to process different types of crude oils. In 1999, some of the downstream units were revamped for the purpose of phasing out of Lead in Gasoline and implemented in 2001 onwards. In 2003, Sulphur specification in Auto diesel was reduced from 1% wt to 0.3% wt by converting / modifying Diesel Hydrotreater units. With the introduction of new diesel specification, types of Crude oils that could be processed at the Refinery were limited to Iranian Light and Arabian Light.

Malaysian Crude oil, Miri Light which was processed as a blend with above crude oils was stopped in 2007 due to economic reasons with escalation of its price compared to crude oils from Middle East. From 2012 May, due to USA sanctions on Iran, Iranian light crude oil was not available and Oman crude, Arabian Light, Murban are left for processing at the Refinery at a lower capacity (40,000 - 45,000 Barrels / day).

3.3.4 Quality of Gasoline and Diesel Marketed in Sri Lanka

Gasoline produced at the Refinery meets the Euro 4 standards except for RON, benzene and Aromatics. However, imported gasoline does not conform to Sulphur specification of Euro 4. Diesel specification is below the level of Euro 2 standards with respect to Sulphur. Also, there are some difficulties in meeting the existing specifications of some of the products when processing above crude oils.

3.3.5 Expansion / Modification of the Existing Refinery

Several proposals for expansion/modification of the refinery have been forwarded by various international organizations from year 2000 incorporating improvement of fuel quality. None of them has materialized so far. In 2010, a feasibility study was carried out on the expansion / modification of the refinery. Although implementation is surfaced in time to time at various forums, no decision has been taken yet for implemention. Recently, Ministry of Petroleum has requested CPC to look for modification of the existing Refinery without going for the said expansion project within a cost limit of US$ 500 million. The proposed refinery expansion will include improving of existing refine process and installation of the sulfur recovery unit. Through the sulfur recovery unit, CPC will be able to provide sulfur 150 metric tons per day to produce Sulfuric Acid and other related products. This Sulfuric Acid can be used to convert Rock Phosphate into Super Phosphate Fertilizer which saves foreign exchange that spends for fertilizer importation by the country and also create large number of employment opportunities. Accordingly, it has been decided to carry out a process study on the modification of the existing Refinery by UOP LLC, USA being the process consultant for the Refinery from its inception.

3.3.6 Existing Barriers in improving the fuel quality

In spite of various benefits, there are several barriers for the fuel quality improvements, which could be summarized as follows: 1. With the existing Refinery configuration, high quality Gasoline or Diesel cannot be produced at the Refinery unless Refinery is modified / expanded aiming for products of high quality Diesel / Gasoline. 2. If high quality standards are imposed without modification / expansion of Refinery, Refinery has to be shutdown and all the products are to be imported. Shutdown of Refinery, which is the only process plant in Sri Lanka, would be a national issue. 3. Import of all the products to the country cannot be done with the existing facilities like piers, pipe lines etc., 4. Import of refined products is not economical compared to production in a Refinery with imported crude oil. 5. Problems associated with pricing of the products at the level of actual cost.

3.3.7 Options for fuel quality improvement

There are several options for the implementation of fuel quality improvements in Sri Lanka 1. Introduction of improved product quality to be done step by step without straightaway going for highest quality. 2. Refinery products and imported higher quality products can be blended to arrive at an interim standard. However, available facilities may have to be improved /modified for this purpose. 3. Implementation of the Refinery Expansion / Modification project as early as possible and imposing the improved standard at the time of completion of the project. According to the feasibility report carried out by KBC, Singapore, one of the reputed process designers in the world. The economic indicators highlighted in the report are given below.

Estimated Capital Cost - US$ 2,215 Million (At mid 2010 prices) Net Present Value (NPV) - US$ 264.6 Million Internal Rate of Return(IRR) -15.17 % Pay Back Period -8.4 Years

4. Presently, two-third of Gasoline and Diesel requirement is imported to the country whereas one third is produced at the Refinery. As such, consideration can be given to the option of importing the two-third of the requirement with higher quality to meet the consumption of specified customers and balance produced at the Refinery for the rest of the customers. The selection of customers may be based on sectors or areas. Additional investment will be required to develop existing facilities. Full switching over to higher standard fuel quality can be implemented once the Refinery expansion / modification are completed.

3.4 Need for Establishment of Independent Fuel Quality Testing Laboratory

Outdoor air pollution can be originated from point sources such as industrial emissions and power plants and mobile sources such as agricultural and constructions vehicles, and road transport vehicles. The severity of air pollution level and the contribution of the transport sector to overall emissions will determine the extent of motor vehicle emissions control requirements. For the management of ambient air quality in the country, it is required to control both mobile and stationary source emission through regulatory standards. Even though the regulatory standards are available for both mobile and stationary sources in Sri Lanka under National Environmental Act, regulation itself are not sufficient to control the total emission loads emitted from above both sources.

Control of fuel qualities is the prime cause of managing total emission loads which contributes the ambient air quality deterioration in the country. In managing fuel qualities, it is required to develop fuel quality strategy which may contain not only fuel quality standards but also monitoring mechanisms and enforcement policies. The most important implementation building block for any fuel quality strategy is monitoring and enforcement. Fuel specifications, how strict they are, do not guarantee good fuel quality for end users.

The foundation for clean fuels at the pump is based on National Standards. The ability to ensure the quality of fuel at the point of distribution – filling station or other distribution network is an important element. The later can only be achieved through implementation and commitment to an effective fuel quality monitoring program. Without the effective monitoring of cleaner fuels at the end of any distribution network, there is no basis for a national standard for cleaner fuel specifications. Failure to establish a fuel quality monitoring system and enforcement policy could render the cleaner fuel specifications irrelevant as it is the implementation policy which provides the incentive to comply with the regulations, especially if there are appropriate penalties acting as a deterrent

Monitoring fuel can be done in following two distinct pathways.

- Monitoring fuel quality to ensure that the fuel sold at the end of distribution network is in compliance with specifications set out in national fuel quality regulation.

- Policing and enforcing fuel quality requirement to ensure compliance and sanctioning those actors not in compliance.

These monitoring mechanisms may include, product sampling and compliance testing, industry reporting, facility audits, certification, pump labelling, fuel product and batch registration surveys, Q/A audits in production process.

Many of these mechanisms are seen as necessary for effective FQMS. However, stakeholder discussion shall determine the most feasible mechanism based on the resources available with regulatory authorities, expertise and trained manpower available within regulatory authorities and Sri Lankan socio-economic and cultural and geographical or legislative situation and financial stability for operation and maintenance of such FQM mechanisms.

3.4.1 Objectives of the Fuel Quality Monitoring System

The prime objective of the fuel quality monitoring system is to ensure that the quality of fuels used by end users is in accordance with prescribed fuel quality specifications, as well as policies related to importation, distribution and disposal. These requirements (specifications and policies) may have been set by giving due consideration on environmental and technical resources (i.e. that the fuel used does not harm vehicle, burners or any combustion equipment, environment and the ambient air quality of the country or emission regulations of country.) The said objective is directly linked to the secondary goal of the monitoring system, which is to protect consumers and guarantee that quality of fuel specialized for different users matches with specifications. Fuel can be off spec through intentional or non-intentional actions, the latter usually refer to non compliance or a result of poor product management, either in production or distribution process. The first refers to the fuel adulteration which may cause harm either vehicle engine or any other combustion equipment and to the environment. However, fuel can be adulterated yet pass some of the sampling tests and not to be classified as off-spec due to test methods that are not capable to trace such variations within the specified test results range. Therefore it is necessary to invest on sophisticated analytical instruments to trace the fuel adulteration in effective fuel quality monitoring system.

Fuel quality monitoring can also have other financial implications such as fuel quality specifications set from a technical as well as an environmental/health perspective, fuel that is off- spec can mean increased vehicle emissions. This in turn means increased costs to government through health care facilities. For example a World Bank study conducted in 1995 concluded that the annual health costs due to ambient air pollution level exceeding WHO guidelines ranged between US$517 - US$2012 million in all over the world. The study however does not isolates the impacts of vehicle emission on urban air pollution from other sources including indoor air pollution. Table 8, below shows the environmental cost reductions associated with improved fuels in Finland and Sweden.

Table 8: Cost Reduction (in euro millions) calculated based on environmental/health damage due to bad air quality

1994 1995 1996 Sum Finland (total) 16 17 17 50 Gasoline 10 10 10 30 Diesel 6 7 7 20 Sweden (total) 34 46 52 132 Gasoline 2 13 13 28 Diesel 32 33 39 104

Even in Sri Lanka, several researches have been conducted to estimate the cost of economic damage due to air pollution. In these studies, analysis have been done based on final economic lost due to human age reduction, personal inefficiency, deceases related to air pollution and cost for treatments, damages to the properties, and reduction of crop harvest by impacts of air pollution on crops. In addition to above, economic damages due to effect of fuel adulteration on end users also considered.

3.4.2 Key Elements of Good Fuel Quality Monitoring and Enforcement Program

Key factors necessary for a successful fuel quality monitoring systems include sampling requirement, process audit requirement, Importer reporting requirement, batch analysis reports, man power needs, financial needs, and policies related to penalties and sanctions. However in design a fuel quality monitoring system suitable for Sri Lanka, following key points must also be taken in to consideration. - Identification of the responsible Authority. - Industry Corporation - Capacity - Staff - Capacity – Equipment. - Sampling and Analysis. - Policies for sanctions and penalties and authorities for implementation of policies. - Fuel quality reporting to the policy implementation Authority. After finalization of firm solutions for above points, following basic schematic steps should be adhered / followed to establish fuel quality monitoring system

Establish which Fuel Parameters to be controlled

Review Current Fuel Quality Standards

Establish inventory for fossil fuel imports, refinery outputs, outputs from distributor networks, statistics of waste oil infiltrations,

Establish fuel quality testing facility with instruments and trained staff sufficient to sample and analysis the above parameters and number of samples to be collected annually or on volume basis of fossil fuel imports

Train special chemists and technicians for fuel sampling, container sealing analysis and reporting.

Design monitoring strategy and monitoring framework with the other stake holder organizations.

Sampling, analysis and reporting to Assessment of laboratory results must be under taken by policy implementing authorities skilled trained laboratory manager with knowledge of

precision and accuracy of the test methods and test results

and quality control and quality assurance practices

3.4.3 Responsible Authority

As an independent body as well as a regulatory body, the Central Environmental Authority must monitor and enforce the provisions of fuel quality strategy in Sri Lanka. Further the monitoring

45 organizations must be the organization setting up standards. But the policy implementation activities should be done by the Ministry of Environment. The following tables provide emission related standards for different fuels.

Emission Related Standards for Gasoline in the National Environmental Act with the effect from 1st of July, 2013.

Item Parameter Unit Low High Test Method No Octane octane gasoline Gasoline 1 Research Octane Number 90 95 ASTM D2699 (minimum) 2. Benzene (Maximum) %v/v 4 2.5 ASTMD3606 3. Lead content (maximum) g/l 0.013 0.013 ASTMD3341 &ASTMD5055 4. Sulfur (S) Maximum) ppm 1000 500 ASTMD1266 5. Reid Vapour Pressure (Maximum) kPa 60 70 ASTMD5191 6. Motor octane number(Minimum) 85 ASTMD2700 7. Evaporation at 150C % 70 75 8 Total Aromatics %v/v 4.5 4.5 UOP 273 9. Oxygen Content(maximum) % m/m 2.7 2.7 By calculation

Emission Related Standards for Diesel in the National Environmental Act. Emission Related Standards for Auto Diesel

Item Parameter Unit Standards Specifications Test Method No with the effect of Auto diesel from January presently 1st, 2007 distributing in Sri Lanka* 1 Cetane Number 49 49 IP 21 or ASTMD613 (minimum) 2. Density at 15C g/l 860 860 ASTMD1298 (Maximum) 3. Distillation (T- 95) 370 No limit ASTMD86 Maximum) 4. Sulphur content ppm 500 2500 ASTMD1266 (max) ASTMD4294 5 Cetane Index 46 46 ASTMD976

There is no independent fuel quality testing reports with international measurement traceability check the compliance of these standards.

3.4.3.1 Emission Related Standards for Super Diesel

Item Parameter Unit Standards Specifications Test Method No with the of super diesel effect from presently January 1st, distributing in 2004 Sri Lanka** 1 Cetane Number 49 49 IP 21 or (minimum) ASTMD613 2. Density at 15C g/l 860 820-860 ASTMD1298 (Maximum) 3. Distillation (T- 95) 370 No limit ASTMD86 Maximum) 4. Sulphur content (max) ppm 500 500 ASTMD1266 (ASTMD4294) 5 Cetane Index 46 46 ASTMD976 **There is no any independent fuel quality testing reports with international measurement traceability to check the compliance of these standards

Even though these standards have been set under National environmental act and commercial specifications have been set by Ceylon Petroleum Cooperation, there is no independent laboratory for the testing of meeting these standards set by Central Environmental Authority or by the Ceylon Petroleum Cooperation.

3.4.3.2 Customer Complaints.

During last few years, several complaints were received from end users related to distribution of low quality petrol and diesel in the distribution net work of Ceylon Petroleum Cooperation. The problem last with the end of consignment but there were no procedures for recalling such low grade fuels and there were no transparency in dealing with the problems according to the general public.

Even though the regulations have been set by Central Environmental Authority, there was no possible methodology to convince the responsible authorities or general public due to lack of facilities for fuel quality testing in Sri Lanka.

3.4.3.3 Industry Cooperation

Industry cooperation is essential for any fuel quality monitoring system to function properly. However the level of cooperation very much depends on the type of FQMS and fuel quality strategy in the country.

In smaller countries like Hong Kong and Singapore, industry has been actively involved in the system. In Hong Kong, international oil companies import all fuel to the area and are required to assume that the fuel meet the legally binding specifications. The self monitoring systems is then complemented by a small percentage of random sampling of retail outlets or barges by responsible authority to ensure the compliance. But these test reports provided by the industry should be validated by the responsible monitoring authority before being forwarded to policy implementing organization. Same system is undertaken in Singapore and no compliance

47 problems have been recorded. Similar system can be built up in Sri Lanka to reduce to operation cost of FQMS.

In addition to above, building up of an industry competition on their image also acts as a driving force for involvement of industry in promoting appropriate fuel quality. If a fuel distributor can display the fuel quality of each and every batch they have delivered, it will win over the customer trust that they are buying right fuel for their use and enhance image as company who cares about the customer and product quality.

3.4.3.4 Capacity: Staff and Equipment

A good fuel quality monitoring systems should have a good laboratory facility with adequate equipment, trained staff, facilities for sampling and transport. Further to above, adequate financial resources should be available for staff remunerations, equipment maintenance and to carry out a sufficient level sampling and testing. Trained staff is a decisive factor of a good fuel quality monitoring laboratory.

Following staff structure is proposed for the proposed Fuel quality monitoring laboratory in CEA:  Technical Manager  Chemist (four)  Technical officers (four)  Laboratory assistants (two)  Lab Attendant (one)

In addition to above, the sufficient staff should be provided to implement enforcement activities in the Ministry of Environment.

The monitoring and sampling equipment needed for establishing a comprehensive FQMS depends on regulated fuel quality specifications and properties that are to be monitored. For implementation of effective fuel quality monitoring systems in Sri Lanka, following list of instruments are needed. These instruments are listed based on the analytical parameters listed in the regulation under National Environmental Act.  Automatic Distillator  Vapour pressure monitor  High Performance Liquid Chromatography with refraction index detector, degasser, thermo static column with back flush, auto sampler controlled by separate PC and printer  Gas chromatograph with FID detector with AC mechanizer, auto sampler, auto injection cryostat  Specific gravity U tube Meter  gum apparatus  Fourier Transform Infra red spectrophotometer  UV Vis spectrophotometer  Automatic 6 position gasoline oxidation apparatus with pressure drop recorder  Energy dispersive X ray Florescence Spectrophotometer with auto sampler  Sediment extraction apparatus  Karl fisher titrator  drying oven

 Atomic absorption spectrophotometer with auto sampler  Octane number determination machine  Analytical balance  Reagent water generator  Fume hood and glass ware including other accessories  Laboratory furniture

These instrument capacity and staff capacity can handle 2500 fuel samples on annual basis. This number may include samples handed over by clients and the samples collected for monitoring purposes by regulatory authority. For the installation of above instruments and for the working space, sample stores for reference, this laboratory needs at least 1200 ft2 of space and it is manageable within the existing space of the laboratory of Central Environmental Authority.

3.4.3.5 Sampling and Analysis

Fuel quality monitoring and enforcement framework relies on sampling and analysis. A properly designed sampling program is vital for the well-functioning FQMS, thus a successful fuel quality strategy. Number of samples that are to be taken varies according to variations in petroleum products distribution, size of distribution networks that ensuring the representative ratio of the samples, statistics of total sales and total imports volumes and number of importers, diversification of end users such as vehicle owners, power generators for national electricity grid, and energy generations in various industrial activities, type of fuel inputs to the country distribution networks and total volume released from each distribution network. It is recommended to take samples from different locations including filing stations pump outlets, refineries, transport pipe lines, fuel transporting bowzers, vessels, barges, storage terminals belongs to importers and stores facilities belongs to local distributors.

Random testing of tank carriers, whether or not these are operated by independent owners or by oil companies, refineries themselves, is extremely important to verify the compliance. According to the studies carried out in all over the world on fuel contamination and adulteration have all reached the same conclusion that in the most cases the contamination occurs after fuel has left the refinery gate either during transport or at the pump.

The contamination can either be adulteration or accidental due to mixing other low quality fuels or previously fuels or fuels previously transported or stored. Fuel analysis should be done very carefully and quality control and quality assurance is the most essential factor in fuel quality reporting. This is the reason for the increased testing charges in fuel quality analysis.

Table 9 shows the approximate testing charges for certain fuel quality parameters estimated based on cost related to taking samples, laboratory analysis, monitoring cost, personal expenditure, office automation and telecommunications charges, stationary, quality control and quality assurance practices, travelling cost and other miscellaneous costs (5% of total cost).

Table 9: Approximate sampling and analysis cost for each parameters

Analytical parameter Cost in SL Rs 1. Aromatic olefin 1000.00 2. Aromatic hydrocarbon 1600.00 3.Cetain ratio (Diesel) 6200.00 4. Distillation (Diesel) 4100.00 5.Fuel Density(Diesel) 2000.00 6.lead 6000.00 7. Oxygen content I gasoline 6000.00 8.Sulfur content (diesel) 4200.00 9.Viscosity 3000.00 10. Octane Number (RON) 12000.00 11. Gum (solvent washed) 6000.00 12.Benzen content 6000.00 13Vapour pressure 4000.00 14.Cetane Index 2000.00

Reporting fuel quality and use of fuel quality reports are important elements in a fuel quality strategy. As indicate throughout this proposal, fuel quality monitoring is the core implementation toll for any fuel quality strategy in the country. Without monitoring, it is impossible to know whether the fuel quality specifications are being met. Therefore reporting of all monitoring results and enforcement date on real time basis to general public and policy implementing authorities is essential. Also it is essential to carrying out a detailed analysis of the annual findings to assess non compliance trends and whether certain fuel quality parameters should be strengthened or whether the fuel quality monitoring system itself and or enforcement mechanism need re-vamping.

Table 10: Total estimated cost of establishment of fuel quality testing Laboratory without capital investment for building space Item Estimated Cost Remarks SLRs millions

Furniture 05 Estimated approximate capital investment is around SLRs.220 Instrumentation 200 million. Staff training 10

Glassware, fume hoods and safety 05 equipment

Office facility PCs, printers and 04 stationary (Annual)

Annual operation and maintenance 04 Certain percentage of this cost cost may be earned by commercial testing

CHAPTER 4

IMPACT OF FUEL QUALITY ENHANCEMENT ON ENVIRONMENTAL, HEALTH AND SOCIO-ECONOMIC SECTORS

4.1 Quality of Fossil Fuels and Impact on the Environment

Sri Lanka at present meets approximately 40 % of its total energy needs from fossil fuels, namely petroleum products and coal. Automobiles, Petroleum refineries, Thermal power plants, Coal power plants and the Industrial sector are the uses of these fossil fuels. Future predictions show that by 2026 oil-based thermal power plants are completely replaced by coal power generation. This section describes the impact of use of fossil fuels on the environment and recommendations for preserving a clean atmosphere.

The principal air pollutants resulting from fossil fuel use are carbon monoxide, the oxides of sulphur SO2 and SO3 (represented by SOx), The oxides of nitrogen, NO and NO2 (NOx), particulates consisting primarily of very fine soot and ash particles and unburned hydrocarbons. Pollutants that are formed in the atmosphere from the reactions of above primary pollutants after emission are the secondary pollutants. Acid rain, smog, the green house effect and the ground level ozone are the main secondary pollutants. Carbon dioxide is a preferred product of fossil fuel combustion, release of excess gas however is undesirable.

Carbon monoxide (CO) results from incomplete combustion of any fuel. It is both a highly poisonous gas and the responsible constituent of photochemical smog. Sulfur oxides are released during combustion from oxidation of sulfur in sulfur containing fuels such as coal and petroleum products. Health effects due to presence of sulfur are discussed in detail in other sections of this report. Sulfur dioxide can react with oxygen in the air to form sulfur trioxide which forms sulfuric acid when mixed with water and creates acid rain. Acid rain makes water streams and wetlands acidic, and affects forests and aquatic environments.

Nitrogen oxides have two sources. Fuel NOx is produced when nitrogen atoms that are chemically combined with the molecules of the fuel are oxidized during the combustion process to form nitric oxide. In addition, thermal NOx is produced in some combustion processes that operate at such high temperatures that nitrogen molecule in the air are oxidized to nitric oxide. When the nitric oxide is emitted to the environment, it readily reacts with oxygen in the air to form nitrogen dioxide. Nitrogen dioxide is a noxious gas that can cause inflammation of the lungs and, at high concentrations, even death. In addition, nitrogen oxides will react further with water and oxygen to form nitric acid. Like sulfuric acid, nitric acid is a very strong acid that easily corrodes or attacks many materials. Nitric acid is also a component of acid rain.

PM emissions (soot and fly ash) are a main concern because they can contribute to long-term respiratory problems. Soot is formed during combustion when the supply of oxygen is insufficient for a complete conversion of carbon to carbon oxides. Fly ash is the inorganic, non- combustible residue of coal combustion. Areas with high concentrations of air-borne particulate matter are more likely to experience fogs, because these particles are preferred nucleation sites for water droplets. Smoke and soot are also very undesirable aesthetically.

Unburned hydrocarbons or volatile organic compounds (VOC) represent another source of air Pollution associated with the use of fossil fuels (especially gasoline). This can be as a result of evaporation from fuel tanks, incomplete combustion and leaks or spills.

Nitrogen oxides and hydrocarbon vapours emitted from automobiles and other sources undergo reactions in the presence of sunlight that produce ground level ozone, hydrogen peroxide and many other chemicals. This causes a light brownish coloration of the atmosphere with reduced visibility, plant damage, irritation of the eyes, and respiratory distress. This is known as photochemical smog, which is another secondary pollutant due to fossil fuels. This ground-level ozone should not be confused with ozone layer in the upper atmosphere, which protects earth's surface from harmful ultraviolet radiation. The depletion of the upper ozone layer is caused primarily by chemicals such as chlorofluorocarbons (CFCs), which are used as refrigerants in air conditioners, refrigerators, etc., which is out of scope of this report.

Carbon dioxide which is a normal constituent of air at an average composition of 315 ppm is not considered as a primary pollutant. During efficient combustion, all the carbon in the fossil fuel is converted to carbon dioxide. However, release of high amounts of CO2 to the atmosphere causes green house effect and is responsible for global warming. Figure 27 shows the CO2 emissions from Sri Lanka over the past 30 years (Extracted from International Energy Agency, Statistics by country- Sri Lanka, WWW//iea.gov).

Figure 27: The CO2 emissions from Sri Lanka

4.1.1 Air pollution control measures

Technological solutions are now available for reducing emissions from most sources. Despite the fact that ‘zero emission’ is the ideal solution, the high cost of emission reduction to near zero level limits the implementation of the concept. The following measures are recommended to implement, or to maintain and upgrade if already implemented, in order to reduce the emission of pollutants and thereby having a pollution free clean environment in the country.

 Industries, diesel and coal power stations are stationary sources of air pollution. Number of gas cleaning techniques suitable for stationary pollution sources is available. Cyclones, scrubbers, bag filters, electrostatic precipitators, momentum separators are commonly used methods for removal of harmful gases, dust and mist from gas streams before releasing to the atmosphere. However, application of the right technique and proper unit design are required for successful operation. Establishment of stringent environmental regulations and proper monitoring through an authorized body is a necessity.  Automobile emissions are comparatively difficult to control and hence use of clean fuel (e.g. low sulfur petroleum products and coal) is the best option which can be achieved through application of pre-combustion cleaning processes or purchase of clean fuel. Comparison of emissions from petrol and diesel vehicles using EURO 1 to EURO 4 standard fuel is shown in the Table 11.,

Table 11: Comparison of emissions from petrol and diesel vehicles using EURO 1 to EURO 4 standard fuel

[Extracted from FUEL QUALITY AND VEHICLE EMISSIONS STANDARDS, COST BENEFIT ANALYSIS MVEC Review of Vehicle Emissions, and Fuel Standards Post 2006 COFFEY GEOSCIENCES PTY LTD, October 2003.]

 Use of fuel oxygenators (Octane enhancers) such as CH3OH or C2H5OH reduces emission of both CO and unburned hydrocarbons.

 Proper engine tuning to provide high O2/fuel ratio is another option to obtain complete combustion. However, this increases the engine temperature and makes thermal NOx emission go up.  Flue gas desulfurization (FGD -passing the flue gas through a slurry of lime) and flue gas denitrogenation (injection of ammonia to react with NO2) also suitable options for SOx and NOx removal.  Use of proper catalytic converter in the automobiles to convert any CO in the combustion products to CO2, to burn any unburned hydrocarbons and to reduce the emissions of nitrogen oxides by transforming them into the harmless nitrogen (N2) is another suitable option for automobiles.  The only way to reduce the CO2 emissions from gasoline combustion is to decrease the fuel use rate by either increasing fuel economy or decreasing the number of km driven by upgrading the public transportation system and encouraging people to use the system. CO2 capture and storage, though still in research stage, is another possible means of alleviating the release of large quantities of CO2 into the atmosphere.

This section will also explain the scenarios of cost saving, reduction of fuel consumption levels, foreign exchange saving on vehicle maintenance and health benefits if transport sector used EURO IV fuel instead of existing EURO I fuels. According to the data available, if the country used cleaner fuels (EURO IV fuel instead of existing EURO I fuels) in 2012 the estimated foreign exchange savings are 325 million US$. This will further explain through the results of an economic analysis for enhancing the fuel quality under two scenarios such as, 1) importing refined fuel directly from the world market without local refinery process and 2) upgrade the existing refine process to improve the quality of local refinery petroleum products.

4.2 Potential Health Related Urban Air Quality Issues Caused By Low Quality Fossil Fuels

Government of Sri Lanka spends more on health sector development compared to other south Asian countries. It was around 5 percent of total government expenditure during the recent past years. Due to the significant resource allocation by the Ministry of Health to conduct public health programs, develop health research, improve health education and installation of modern medical equipments, the health sector of the country has shown tremendous improvement. Over the years most of the indicators show that, many communicable diseases have been controlled, where the trends in mobility and mortality indicate a decrease in hospital admissions and deaths resulting from infectious and parasitic diseases. As a result of mobility and mortality being substantially decreased the life expectancy of the general public has increased. But in contrarily, hospital admissions and deaths due to Non-communicable diseases are on the increase. Amongst those non-communicable diseases, Ischemic Heart Diseases (Heart Attacks), Neoplasms (Cancers) and diseases of the respiratory system such as Bronchitis and Asthma which are on the rise has a positive correlation to air pollution in the country.

Research has revealed that ambient particulate matter (PM10, PM2.5, PM0.1) and Sulfur Dioxide (SO2) leads to the most significant adverse health effects that are associated with air pollution in Sri Lanka. The other primary vehicular exhaust pollutants in the country includes; Carbon Monoxide (CO), Nitrogen Oxides (NOx), and Hydrocarbons (HC).

Diesel exhaust is composed of gases and fine particles. It can irritate airways when inhaled at relatively high concentrations. At lower concentrations, it causes the release of specific cytokines, chemokines, immunoglobulins, and oxidants in the upper and lower airway. These are proteins secreted from various cell types that mediate allergic and inflammatory responses. They can initiate a cascade of cellular processes culminating in airway inflammation, mucus secretion, serum leakage into airways, and contraction of bronchial smooth muscle (Pandya, RJ et al., 2002). Researchers have shown DE can increase the inflammatory response to allergens; (Diaz-Sanchez, D et al., 1994).

Inhalation of high sulfur diesel emissions and its health impact on humans

Diesel exhaust is associated with a number of health impacts.

a) Shorter term exposure Inhalation may cause respiratory tract irritation, eye, throat, and lung irritation and Central Nervous System depression. High levels may cause giddiness, headache, dizziness, nausea, vomiting, and loss of coordination, narcosis, stupor, coma, and unconsciousness. It also leads to, exacerbation of an existing lung condition like asthma, coughs and increased phlegm.

b) Longer term exposure Prolonged exposure may cause dizziness, weakness, weight loss, anemia, nervousness, and pain in the limbs, peripheral numbness, paresthesia and possible renal failure. Degenerative changes of liver and kidneys may occur after prolonged exposure to high concentrations. Increase risk of lung cancer.

Direct contact of high sulfur diesel with the skin may cause drying, cracking, and defatting dermatitis and might cause extreme irritation with severe erythema and edema with blistering and open sores. Absorption of large amounts may result in narcosis. Repeated or prolonged exposure may cause irritation, dermatitis, and a rash of pimples and spots.

Diesel engines powered by high sulfur diesel emit large amounts of particulate matter (soot), sulfur oxides and the noxious nitrogen oxide gas and hydrocarbons. These air pollutants contribute to serious public health problems, especially among the children and elderly population. These pollutants are proven to cause:

 Increased hospital and emergency room visits attributed to respiratory diseases  hundreds of thousands of asthma attack episodes,  millions of lost work days, reducing productivity,  thousands of early deaths among Sri Lankans,  loss of billions of rupees pertaining to health expenditure and premature deaths.

According to the American Lung Association, diesel pollution affects lung function and growth in children and lung health of adults. Emissions from regular diesel fuel engines are estimated to cause hundreds of premature deaths annually in Sri Lanka. Air quality is a great public health concern. Citizens and visitors of Sri Lankan cities such as Colombo, Kandy, Gall, Jaffna, Nuwaraeliya, Badulla, Kurunegala, Gampaha have the greatest exposure to diesel fumes as those have the highest vehicular concentration and the human population compared to rural areas and other smaller cities. Therefore the resident population of those cities has the highest lifetime-risk of developing air pollution attributed non-communicable diseases (NCD).

Table 12:- Leading NCD Related Hospital Deaths by District, 2007

Source: Non-communicable Disease–2007 Hospital Discharge Data Statistics Non- communicable Disease Unit of the Ministry of Health (2011)

The data published by the Non-communicable Disease Unit of the Ministry of Health (2011) on Non-communicable Disease Hospital Discharge Data Statistics (Table 12) confirms that; a) in terms of Cancer in Colombo, Gall and Jaffna it is the No. 1cause of death and in Kandy and Badulla it is the 2nd cause of death. b) in terms of Ischemic Heart Disease, Kandy, Nuwaraeliya, Badulla, Kegalle it is the No. 1cause of death and in Colombo, Gall, Kurunegala it is the 2nd cause of death. In Sri lanka as a whole Ischemic Heart Disease is the No. 1cause of death, whereas Cancer, Cerebrovascular Disease, Cardiovascular disease and Diseases of the Respiratory system had become 2nd, 4th, 6th respectively. Though these diseases are known to be multifactor in its aethiology (origin) researchers have revealed that the influence of air pollution is significant and cannot be ignored. Moreover diesel emissions confirmed to be carcinogenic by the World Health Organization too.

It is impossible to clean the air, or in particular to reduce air pollution from the transportation sector, without getting sulfur out of fuels and no significant air pollution reduction strategy can work without reducing sulphur to near‐zero levels in the diesel. The primary purpose of introducing low sulphur diesel fuel is to reduce harmful emissions and its negative health effects that are associated with regular diesel fuel. This means reduction of exhaust emissions of particulate matter, hydrocarbons, and nitrogen oxides by large. The US EPA estimates that there will be significant health benefits form introduction of ultra low sulphur diesel and together with stringent emission standards these benefits will increase over time. Though it is impossible to place a monetary value on health the U.S. EPA estimated that the annual monetized net benefits would be $66.2 billion in the United States, due to the thousands of avoided hospital admissions, asthma emergencies, lost work days, chronic pulmonary ailments, other health impacts, reduced agricultural crop and commercial forest damage.

Therefore introduction of “Ultra Low Sulphur Diesel” is the key to reducing emissions from diesel vehicles. Most benefits will be achieved by those Sri Lankan cities, where the vehicular fleet is greater and the population exposure to diesel missions and PM is greatest.

4.3 Economic Analysis for Fuel Quality Improvement

The Gross Domestic Product (GDP) of Sri Lanka has recorded as US $ 57 billion in 2012 out of which the import bill of fossil fuel accounted as US $ 5.1 billion in 2012. This is an equivalent of 9% of the country’s GDP. It should be noted that the value of the fuel consumed by the transport sector was only US $ 2.9 billion which consists of 664.962 million litres of petrol, and 1,686.052 million litres1 of diesel2 in 2012. There is notable increased of fossil fuel consumption by the power sector in 2012, as it’s value of import bill of fossil fuel for power generation was US $ 2.2 billion which is equivalent of 41% of total fuel consumption of the country. The high expenditure on import of fuel has big impact on the government macroeconomic policies which is starting from budget deficit, balance of payment and all capital and recurrent expenditure. Therefore, energy efficiency of power sector and fuel efficiency of transport sector is one of the key for an economic growth and balancing the social equality, which also linking to political stability of the country.3

Most of developing countries have introduced national technology mandates intended to make vehicles run cleaner by requiring manufacturers to develop effective vehicle emission systems and oil companies to make less polluting fuels. This has contributed to arrest the increased of emission level even with high growth of vehicle ownership.4 The fuel quality has impact on vehicles on following;

 Fuel efficiency ( Number of km’s run per one litre of fuel);  Emission of pollutants(Carbon Monoxide, Nitrogen oxides, Volatile organic compounds, Particulate matter (fuel related), lead

It was found to be that the present fuel quality regulations has not been imposed by the authority as supply of fuel to the market dominated by the Ceylon Petroleum Cooperation and Lanka Oil India Company who are also part of government. The fuel efficiency factors on the EURO slandered are given below;

Euro II 1. Diesel Fuel (Km’s per Litre) 4.2 km. (Ashok Leyland Bus) 2. Gasoline (Km’s per litre) 7.5 km (Toyota Corolla Motor Car)

Euro III 1. Diesel Fuel (Km’s per Litre) 5.0 km. (Ashok Leyland Bus) 2. Gasoline (Km’s per litre) 9.0 km (Toyota Corolla Motor Car)

Euro IV 1. Diesel Fuel (Km’s per Litre) 6.20 km. (Ashok Leyland Bus) 2. Gasoline (Km’s per litre) 10.0 km (Toyota Corolla Motor Car)

Further the air pollution could be reduced considerably by using EURO III fuels compared to EURO II fuels, and also from EURO IV fuel compared to EURO III fuel. This has high implication on cost of fuel importation and cost of health which includes cost of medicine, and

1 Source: Ceylon Petroleum Corporation and Lanka Indian Oil Company 2 This includes Petrol with 95 Octane and Super Diesel. 3 Ibanez Gomez, “Transport Economic – Legacy of John Mayor”Kennedy School of Harvard University, 2009 4 Howitt, Arnold M., and Altshuler, Alan, “ The Politics of Controlling Auto Air Pollution”, The booking institution, 1775, Massachusetts Avenue, N.W. Washington D.C, 20036, 2001 58 low productivity of labour force. Further improvement in fuel quality would contribute to saving of fuel consumption through improved technical performance and efficiency of the vehicles.

CHAPTER 5

ELEMANTS AND STRATEGIES IN THE FUEL QUALITY IMPROVEMENT ROAD MAP

Over the past 30 years, pollution control experts worldwide have come to agree that cleaner fuels must be a critical component of an effective clean air strategy. Cleaner fuels are fuels that result in lower emissions of air pollutants when used in motor vehicles. In recent years, this agreement on the critical role of fuels has deepened and spread to most regions of the world. Improving fuel quality is now seen not just as a necessary means to directly reduce or eliminate certain pollutants such as lead, but as a precondition for introducing many important pollution control technologies. For example, lowering sulfur content enables the use of diesel particulate filters. A critical advantage of cleaner fuels is the rapid impact these fuels have on both new and existing vehicles. Tighter new car standards can take 10 or more years to be fully effective, whereas the removal of lead in gasoline in Asia has immediately reduced lead emissions from all vehicles. A clear understanding of the necessary emission reductions from vehicles and other sources to achieve healthy air quality is essential in developing strategies to clean up vehicles. Depending upon the air quality problem and the contribution from vehicles, the degree of control required will differ from location to location.

A broad approach to the formulation and implementation of policies and actions aimed at reducing vehicular emissions is necessary where vehicles are major sources of pollution. Reducing vehicular pollution will usually require a comprehensive strategy that includes these key components: (i) emission standards for new vehicles, (ii) specifications for clean fuels, (iii) programs to assure proper maintenance of in-use vehicles, and (iv) transportation planning and demand management (Figure 28). One critical lesson is that vehicles and fuels should be treated as a system. The emission reduction goals should be achieved in the most cost effective manner possible. Although this report acknowledges the importance of a systems approach, it emphasizes the contribution of cleaner fuels to reducing urban air pollution.

Figure: 28 Elements of a Comprehensive Vehicle Pollution Control Strategy

Vehicle emission and fuel quality standards play a critical role in limiting the emissions from each vehicle and, together with other measures, in reducing the impact of continued vehicle growth on Asia’s air quality.

3 In Asia’s cities, the average concentration of PM10 (in the air is 90μg/m , exceeding the World 3 Health Organization air quality guideline of 20μg/m by almost 400%. As PM10 in the ambient

60 air increases by 10μg/m3, the risk of early deaths in Asia goes up by 0.5% according to research done by the Health Effects Institute. Motor vehicles are responsible for as much as 75% of ambient PM levels in these cities. According to the air quality monitoring data of the CEA since 1996, the transport sector itself is contributing about 60% to the air pollution especially in Colombo City. Near roadside traffic emissions are also a major concern, and health studies suggest that people living within a range of up to 300 to 500 meters to a highway or major road are most highly affected by traffic emissions. Protecting public health and reducing the economic burden of treatment are compelling reasons to mandate vehicle emissions and fuel quality standards in Asia.

While the trend in Asia is to progressively tighten vehicle emission standards, the region has a long way to go towards harmonization. India moved nationwide to Euro 3 this year and China to Euro 4 equivalent standards in 2008. Major metropolitan areas in India have even adopted stricter standards (e.g., Euro 4 equivalent vehicle emission standards in 13 cities). But other South Asian countries including Sri Lanka have yet to develop road maps beyond their current Euro 1 and Euro 2 standards.

However in Sri Lanka, Hon. Minister of Environment and Natural Resources under Section 32 of the National Environmental Act, No 47 of 1980, read with Section 23J and 23K of the Act gazette the regulations for the emission related fuel quality standards on 30th June 2003. This regulations may be cited as the National Environmental (Air, Fuel and Vehicle Importation Standards) Regulations No 01 2003 and was planned to implemented with effect from July 01, 2003.

In Southeast Asia, some other countries also plan to move to Euro 4, but seem to waver in their resolve to take this step soon; plans to move to Euro 4 in 2012 have been delayed to 2015 or later. Improving only LDV’s is not the silver bullet. It’s only a part of solution. Majority of the Asian fleet is dominated by Non-LDV vehicles and the trend would remain the same even with high LDV growth rates. Vehicles like two wheelers and trucks need similar attention. Approximately only 30% of the fleet is composed of LDV’s.

Figure 29: Emission Standards for New Light-Duty Vehicles

Sulfur in fuels deserves special attention. At high levels (e.g., above 50 ppm), sulfur can reduce the effectiveness of advanced three-way catalysts for gasoline vehicles and clog particulate filters in diesel vehicles. The link between low sulfur and better air quality can be shown in the case of Thailand, which achieved lower roadside and ambient levels of PM10, carbon monoxide and nitrogen dioxide from its fuel sulfur reduction measures. However, progress in reducing sulfur levels in diesel down to 50 ppm in other Asian developing countries has been slow.

China and India are phasing down to 350 ppm nationwide starting 2010, even though 50 ppm has already been mandated for Beijing (2008), Shanghai (2009) and Guangdong Province (2010). Sulfur levels in diesel in most Southeast and South Asian countries (except Thailand) remain at 500 ppm and higher.

Figure 30: Current and Proposed Sulfur levels in Diesel in Asia, EU and USA

Translating quicker progression lies in removing fuel subsidies. Countries like Malaysia and Indonesia provide 2.6-2.7% of GDP to provide artificial low cost fuels. This acts as a disincentive for refineries to pledge more support for cleaner fuels. It is to be noted that subsidized fuels cannot be considered as the service policy of the country but a product which is optimally priced.

To move Sri Lanka forward, national government need to take the lead by mandating a clear and firm road map for cleaner fuels and vehicles. In consultations by experts in the field with governments and other stakeholders, the question on the financial and economic impacts of tighter vehicle emission standards always crops up. Experience from developed countries suggests that moving to cleaner fuels and vehicles does not adversely affect the economy and in fact benefits the economy through better public health. Country-specific analysis on the financial and economic impact could help national governments show that the cost of inaction (public health impact of air pollution) truly outweighs the cost of taking action (mandating stricter standards).

Finally, reducing emissions from motor vehicles in Sri Lanka requires an integrated approach which includes improving vehicle inspection and maintenance systems, transport planning and demand management, and promoting public transport and non-motorized transport. These parallel measures are needed; otherwise, the gains in reducing emissions from each vehicle through stricter standards could be offset by an increase in vehicle numbers and in vehicle- kilometers traveled. Also, growing interest in fuel economy standards provide a window of opportunity to link the vehicle emission standards with fuel economy standards. Linking these two measures requires a new approach and it has the potential to provide huge benefits to the society.

Currently countries are charting out different strategies rather than thinking of a modality to benefit from both by uniform application. Most often the institutions working out both the policies are nearly the same and thus two issues can be combined to maximize benefits by early implementation. For example, concept of Eco Cars in Thailand -– An Eco car meets minimum

64 pollution standards of EURO4 or higher, emitting no more than 120 g CO2/km. To promote the sales of fuel efficient cars, the Ministry of Finance put in place a tax incentive scheme which reduces the excise tax rate on standard passenger cars that meet fuel-efficiency criteria, and qualify as so-called “eco cars.” . Similar integrated system exists in Japan. The other reason for linking these two standards is the impact of vehicle emission standards in reducing “Black Carbon”. Experts believe that reducing black carbon (BC) offers biggest impact on immediate climate mitigation. Black carbon is formed through the incomplete combustion of fossil fuels, biofuel, and biomass and switching to stringent emission standards can reduce the BC emissions.

CHAPTER 6

RECOMMENDATIONS FOR THE ROAD MAP OF INTRODUCING CLEANER FUELS IN SRI LANKA

Sri Lankans are currently enjoying high life expectancy in the region and is expected to prolong further. Thereby Sri Lanka will have the prospect of hoisting its life expectancy to a level that is observed in the developed world. Declining mortality and morbidity will be able to produce a healthier labour force that is of paramount importance in developing our country rapidly. Unfortunately morbidity and mortality (deaths) due to non-communicable diseases that are attributed to air pollution have top the list in Sri Lanka. When air pollution from mobile sources was taken in to consideration, diesel vehicles powered by high sulfur diesel become the top priority in terms of air quality management in the country. It is eminent that if immediate measures are not taken to introduce low sulphur fuel, its health consequences on morbidity and mortality from air pollution related non-communicable diseases would be a difficult task to achieve and our life expectancy would be static or even reversed in the future. Considering and summarizing all the findings of this report this technical expert committee suggest following recommendations for enhancing the quality of fossil fuels for managing better air quality in Sri Lanka.

Recommendation 1:

Introduction of low sulphur diesel has to be implemented entirely through importation of high quality refined fuels, unless the expansion / modification project of local refinery is implemented. Nevertheless, the cost of implementation of the said project of the refinery and other implications (cost benefit analysis) has to be documented. Considering the social, environmental and health benefits the Ministry of Petroleum Industries will be submitting a Cabinet Paper to introduce 10 ppm sulphur diesel as super diesel by the 1st of August 2014 and the Ministry is planning to introduce Regular Auto Diesel with sulphur content with 800 -1200ppmsince the second half of 2014 with the existing limitations in the CPC Refinery at Sapugaskanda.

Therefore, the Officials’ Committee recommends to incorporating the following targets to the action plan on introducing low sulphur diesel:

. From 1st January 2015-2020 : Introduction of 1000ppm sulphur Auto Diesel and – 2020-2025: Introduction of 350 ppm sulphur Auto Diesel (this limits are subjected to the implementation of refinery upgrading) . From 1st of August 2014 onwards: Introduction of 10 ppm Super Diesel

Recommendation 2: To develop a fuel quality road map including use of renewable energy sources and alternative fuels for Transport, Industrial and Power Sectors with implementation plans for Sri Lanka and; to develop fuel quality standards for the fuels used in Industrial and Power Sectors with immediate effect.

(a) Alternative Fuels and Vehicles:

Fuel diversity in the transport sector is an essential element for reducing heavy dependence on petroleum and improving energy supply security in the transport sector. Accordingly promotion of electricity as an energy carrier in the transport sector is highly beneficial. It is highly recommended to explore the possibilities of the use of renewable energy (such as solar, wind, etc. based electricity generation) in transport sector as an Off Grid system considering the existing constraints in the electricity grid to connect renewable energy. Electric vehicles could deliver 3 to 4 times more energy efficiency than conventional vehicles, while hybrid vehicles could save up to 70% of fuels. There are number of areas of interventions:

. Promotion of electric and hybrid vehicles: It is recommended to introduce fiscal concessions for electric and hybrid vehicles, including electric three-wheelers and scooters, with additional incentives for local manufacture/value addition. The recommended target is to reach 10% by 2016 and 20% by 2020 of the total number of vehicles imported. . Railway Electrification: Railway is one of the most efficient modes of transport and introduction of electrification could improve the services further. When considering the grid electricity demand pattern, where there is low demand for electricity during peak hours of traffic (morning and evening), use of electricity will improve the electricity demand curve. As such, it is recommended to give priority to study and implement the electrification of the Colombo suburban Railway Network which includes the routes Colombo/Polgahawela on the Main line, Colombo/Aluthgama on the Coast line and Ragama/Negombo on the Puttlamline. Initially the stretch on the Main line between Colombo and Polgahawela where the passenger demand is comparatively high, could be undertaken with the balance routes on the Coast line and Puttlam line to be electrified by 2020. . Electricity Tariff: The use of electricity for transport should look into its impact of grid electricity demand curve. The benefits of electrification could be maximized (and the adverse effects could be minimized) by allowing the use of electricity to charge the batteries only during off-peak hours. Therefore, it is recommended to device a mechanism to promote the off-peak hour electricity usage for electric vehicles, especially through appropriate time of the day consumer tariff scheme.

Further, introduction of biofuels, such as ethanol and biodiesel, blended with conventional petroleum oil (petrol and diesel respectively) is implemented in several countries as a long term solution. Rapid advancements in technologies for production, processing and end-use energy conversion are taking place worldwide. Main concern of this sector is the potential conflict with food security. In order to address this issue, third generation biofuels (e.g. algae based biodiesel) are being researched and developed extensively. Under these circumstances, applicability and adaptability of these developments to the local context are important for the long term benefits. Therefore, promotion of biofuels with phase-in introduction as blends with conventional fuels is recommended, targeting at-least 2% by 2020. The potential of the use of biogas for transport should also be explored.

(b) Fuel Quality Improvements in Other Sectors:

In order to get the maximum benefits of fuel quality improvement for managing air quality in Sri Lanka, it is apparent that, in par with transport fuels, cleaner fuels have to be introduced in other sectors (i.e. domestic, industry and power). Particularly, sulphur levels in furnace oil and coal are of much interest and therefore the following targets are set: Coal: 1.2% sulphur level from 2015 onwards Furnace Oil: From 3% sulphur from 2015 and 1.5% from 2020.

Recommendation 3: To explore the possibilities of introducing LNG as a source of energy in all the sectors.(i.e. power generation, transport and industry). In particular, fuel switching of the existing thermal power plants from petroleum fuel oils to LNG is recommended, considering the less environment impact per unit of energy released. The promotion of LNG as a low carbon and cleaner energy source is well recognized. The least cost methodology adopted in long term generation plan of CEB shows that coal is the cheaper option and CEB commitment of coal plants are based on the Long Term Generation Expansion Plan (LTGEP) 2013 -2032. The Government should make a decision on the introduction of LNG as a source of energy for all the energy sectors by considering the incremental policy cost associated with the environment benefits and effects on energy security, together with the potential of NG reserves in Sri Lankan territory. Therefore, it is recommended to explore the findings of the on-going feasibility study of Ministry of Power & Energy with due consideration of the potentials and impacts on all the end- use sectors and set the targets accordingly.

Recommendation 4: To harmonize the fuel quality standards with emission (both mobile and stationary sources) and ambient air quality standards with the use of sound air quality modeling methodology, while taking into consideration of technology status and trends. Harmonization of the relevant standards is a fundamental requirement of a sound air quality management programme and therefore needed to be accomplished promptly. Such efforts require comprehensive air quality measurement mechanisms and facilities, together with air quality modeling tools. It is recommended to facilitate the above through finances and capacity development programs for strengthening of the Air Resource Management Center (AirMAC) in the Ministry of Environment and Renewable Energy by linking and mobilizing the resources relevant universities and government agencies.

Recommendation 5: To implement the proposed Sapugaskanda Oil Refinery Expansion and Modernization of the existing refinery in order to provide high quality cleaner fuel as required by the proposed road map.

Although the Government has plans to import cleaner refined fuels, the average quality of the fuels marketed in the country is heavily dependent on the quality of fuel refined in Sri Lanka. Therefore, with the global and regional fuel quality trends, it is apparent that similar quality enhancements have to be adopted in Sri Lanka in the near future. Under such circumstances, in order to provide high quality cleaner fuel, the proposed Oil Refinery Expansion and Modernization of the existing refinery in Sapugaskanda is becoming a necessity. Therefore, it is recommended for immediate implementation of the proposed Oil Refinery Expansion and Modernization project.

Recommendation 6: To establish independent fuel quality testing laboratory in the Central Environmental Authority and in the University of Moratuwa to monitor the quality of fuels distributed in sales outlets and all the other types of fuels used in the country. As in case of harmonization of standards highlighted under recommendation 4 above, establishment of independent fuel quality testing laboratory is a fundamental requirement for effective implementation / enforcement of relevant standards. It is recommended to review the present fuel quality testing facilities and identify the existing gaps in the local institutions such as CEA, ITI, University of Moratuwa and University of Peradeniya and provide assistance to establish a national level fuel quality laboratory facility by enhancing the resources, training and capacity building of these institutions.

Recommendation 7: To take actions to import the Euro IV standard fuels to the country to meet the above recommendations considering the socio-economic and environment benefits and refinery to produce fuels according to existing standards until implementation of the refinery expansion and modernization project in consultation with the Ministry of Petroleum Industries and CPC. The importation of cleaner fuels has been already accepted and, presently, 10 ppm sulphur super diesel (Lanka Super Diesel 4 Star) is being imported and distributed. However, as the demand for super diesel in the local market is still low, the average quality of diesel is primarily determined by the quality of auto-diesel, which is produced through blending the imported ones with locally refined fuels. Therefore, till the implementation of the refinery expansion and modification project is accomplished, it is recommended to import cleaner refined fuel for achieving the set targets. Since some of the fuel parameters in the Euro standards are not very relevant to the country, it is also recommend to study and develop national fuel quality standard system by taken in to account the local context.

Recommendation 8: To establish a Fuel Quality Management Committee in the Ministry of Environment & Renewable Energy, under the join administration of Secretaries of Ministry of Environment& Renewable Energy, Ministry of Power &Energy, Ministry of Petroleum Industries, Ministry of Technology &Research, Ministry of Transport, Ministry of Finance &Planning. This Committee should take decisions based on the recommendations of Technical Advisory Committee comprised of technical experts of all relevant stakeholder organizations. It is recommended to establish a Fuel Quality Management Committee under the join administration of Secretaries of Ministry of Environment & Renewable Energy and Ministry of

Petroleum Industries for effective monitoring and successful implementation of the roadmap. As the final aim of the fuel quality road map is the air quality management in the country, it is also recommended to enhance the scope of activities of this committee to cover overall elements in air quality management programme at national level, with renaming it as Air Quality Management Committee.

CHAPTER 7

ACTION PLAN OF THE FUEL QUALITY ROAD MAP OF SRI LANKA

Activity Responsibilities/ Organizations Target KPI 1. Introduction of low sulphur - Development of the regulation / - From 1stof August July 2014 onwards: - Regulation developed diesel Ministry of Transport, CEA Introduction of 10 ppm Super Diesel - % of 10ppm Super Diesel - Implementation / Ministry of - From 1st January 2015 – 2020: Marketed/sold in the country by Petroleum Industries/CPC Introduction of 1000 ppm sulphur 31st December 2014 Auto Diesel and 2020 -2025 : - % of 1000ppm Auto Diesel Introduction of 350 ppm sulphur Auto Marketed/sold in the country by Diesel 31st December 2015& 2020 -% of 350ppm Super Diesel Marketed/sold in the country by 31st December 2020& 2025 2. Introduction of alternative - Fiscal incentives / Ministry of EV / Hybrid 10% by 2016 and 20% by - Fiscal incentive structure fuels for Transport – Electric Finance and Planning 2020 of the total number of vehicles established Vehicles and provide imported. - Ministry of Transport/Dept. of Motor - % of EV/Hybrid vehicles attractive tax concessions for Traffic imported to the country by promoting smaller hybrid 2020 vehicles with higher efficiency in fuel consumption 3. Introduction of alternative - Development of the regulation / - Endorse Bio energy policy in 2015 - Regulations developed fuels for Transport – Biofuels Ministry of Transport, Ministry of - Biogas for transport – Pilot - No of biofuel vehicles Environment & Renewable programme for conversion of 3- - Liters of biofuel blends sold Energy/CEA wheelers, Including gas cleaning and - Implementation / Ministry of storage technologies. petroleum Industries /CPC /Ministry - Biodiesel – 3rd generation biofuels: of Sugar Industry Introduction by 2016 and 1% by 2020 4. Development of fuel quality - Fuel quality standards for industrial - Furnace Oil / Heavy diesel: Maximum - Fuel quality standards standards for industrial fuel – fuel – Furnace oil / heavy diesel by 3% sulphur from 2015 and 1.5% from developed by 2015 Furnace oil / heavy diesel CEA/Ministry of Environment & 2020. - Sulphur contents in Furnace oil Renewable Energy and SLSI; /. heavy diesel in the market Ministry of Petroleum Industries and CPC 5. Development of Fuel quality - Fuel quality standards for industrial - Maximum sulphur content in the Coal - Fuel quality standards in place standards for industrial fuel – fuel – Coal by CEA/Ministry of use for industrial sector should be by 2015 Coal Environment & Renewable Energy; 1.2% from 2015 - Sulphur contents in coal used Ministry of Power and Energy and by industry CEB 6. Expansion and modernization - Ministry of Finance and Planning - Maximum 0.5 % sulphur diesel - Expansion and modification of of the CPC Petroleum produce from 2018 the CPC Petroleum Refinery - Ministry of Petroleum Industries Refinery completed - CPC - Maximum 10 ppm sulphur diesel produce by 2020 - Sulphur recovery plant - Establish sulphur recovery plant by established at the Refinery by 2018 with a capacity to handle all the 2018 sulphur processed at the refinery - % sulphur level in diesel refined by CPC 7. Importation of the Euro IV - Ministry of Petroleum Industries - Maximum of 10 ppm sulphur diesel as - % sulphur levels in diesel standard fuels to meet the - CPC Lanka Super Diesel 4 Star in Island imported above recommended 10 ppm wide from 1st August 2014 onwards. sulphur diesel as super diesel - maximum of 1000 ppm sulphur diesel and 500 ppm ppm sulphur as auto diesel Island wide by 2015 diesel until implementation of the refinery expansion and modification projects

8. Development of fuel quality - Fuel quality standards for power - Maximum 3% sulphur fuel for the - Fuel quality standards in standards for power sector – sector – Furnace oil / heavy diesel power sector which use furnace oil / placeby 2015 Furnace oil / heavy diesel by CEA/Ministry of Environment & heavy diesel by 2015 Renewable Energy; CPC, CEB; - Maximum 1.5% sulphur fuel for the - Sulphur contents in furnace oil Ministry of Petroleum Industries and power sector which use furnace oil / Ministry of Power and Energy / heavy diesel used by the heavy diesel by 2020 industry by 2015 and 2020 9. Development of fuel quality - Fuel quality standards for power and - Maximum sulphur content in the Coal - Fuel quality standards in standards for power sector- – Industrial sector – Coal by use for power sector is 1.2% by 2015 placeby 2015 Coal CEA/Ministry of Environment & - Sulphur contents in coal used Renewable Energy by power plants 10. Iintroducing LNG as a source - Ministry of Power and Energy - Explore the findings of the on-going - LNG Feasibility study of energy in all the sectors as - Ministry of Petroleum Industries feasibility study of Ministry of Power completed a cleaner fuel. & Energy with due consideration of - % Potential of LNG in each - Ministry of Transport the potentials and impacts on all the energy end-use sector - Ministry of Industries end-use sectorsand set the targets accordingly Implementation by CEB, Ministry of Transport and Ministry of Commerce and Industries 11. Railway electrification Plan - Ministry of Transport - 3 Number of electric railway - Number of detailed feasibility - Ministry of Finance lines/trains are established by 2025 studies completed (including Veyangoda to Kalutara) - Dept. of Railways - Number of electrified railway lines established by 2025 - CEB

12. Establishment of an - Ministry of Finance and Planning - A network of independent Fuel quality - Number of independent independent fuel quality - Ministry of Environment & testing laboratory is established by institutions having enhanced testing laboratory/s. Renewable energy 2015 (UoM, UoP, CEA, ITI) fuel quality testing facilities by

- Ministry of Petroleum Industries 2015 - Ministry of Science and Technology - Number of fuel quality - Ministry of Higher education parameters that could be tested by independent institutions by - University of Moratuwa 2015 - University of Peradeniya - CEA - ITI 13. Harmonize the fuel quality - Ministry of Environment & - Air Resource Management Center - Air quality and Fuel Quality standards with emission (both Renewable Energy (AirMAC) will be formalized and standards developed mobile and stationary sources) strengthen the capacity by 2015 by - CEA - Number of Air quality and ambient air quality linking and mobilizing the resources monitoring stations standards, with national air - ITI relevant institutions established quality model - University of Moratuwa - Gazzeting of the new harmonized - AirMAC is formally fuel quality standards with emission - University of Peradeniya established in the Ministry of standards (both mobile and Environment & Renewable stationary sources) and ambient air Energy quality standards by 2015 - National air quality model in - 02 Number of Ambient air quality place monitoring stations established in the country by 2015 and 06 by 2020 - Developed national air quality modeling tool/methodology for managing and prediction of air pollution risks by 2016

References

1. Diaz-Sanchez D, Garcia MP, Wang M, Jyrala M, Saxon A.(1999). Nasal challenge with diesel exhaust particles can induce sensitization to a neoallergen in the human mucosa. J Allergy Clin Immunol 104:1183-118

2. Dissanayake L. Recent Trends of Morbidity and Mortality in Sri Lanka Department of Demography, University of Colombo, Sri Lanka

3. Gordian M.E, Trost B, Clint-Farr, MN, (2007) Rural Alaska Diesel Exhaust Health Impact Study; Division of Air, Department of Environmental Conservation Institute of Circumpolar Health Studies, University of Alaska Anchorage http://www.ehow.com/explain-low-sulfur-diesel-fuel.html

4. Pandya RJ, Solomon G, Kinner A, Balmes JR.(2002). Diesel exhaust and asthma: hypotheses and molecular mechanisms of action. Environ Health Persp 110:103-112

5. Wilson A, Hammitt J.K. (2008) The Benefits and Costs of Ultra-Low Sulfur Diesel in Mexico , Gretchen Stevens, Harvard Center for Risk Analysis, Harvard School of Public Health, Boston, MA

6. Non-communicable Disease Statistics (2011) Hospital discharge Data – 2007, Non- communicable Disease Unit, Ministry of Health, Sri Lanka

7. Diesel Exhaust Health Assessment, Ultra Low Sulfur Diesel Frequently Asked Questions http://www.mwfi.com/ulsd/ulsd_faq.htm

8. Material Safety Data Sheet Ultra Low Sulfur Diesel; Content Last Revised 11/ 02; 06/05; 10/08 http://www.spragueenergy.com/documents/MSDS- Ultra_Low_Sulfur_Diesel_number2.pdf

9. Jeffrey S. Gaffney, Nancy A. Marley, The impacts of combustion emissions on air quality and climate – From coal to bio fuels and beyond. Atmospheric Environment, 43 (2009), 23–36.

10. http://www.info.energy.gov.lk/, (January 2013)

11. FUEL QUALITY AND VEHICLE EMISSIONS STANDARDS, COST BENEFIT ANALYSIS MVEC Review of Vehicle Emissions, and Fuel Standards Post 2006 COFFEY GEOSCIENCES PTY LTD, October 2003.

12. A Road Map for Cleaner Fuels and Vehicles in Asia, Final Consultants’ Report, Asian Development Bank, November 2008

13. International Energy Agency, Statistics by country- Sri Lanka, WWW//iea.gov.(Jan 2013)

14. R.K. Trivedy and P.K. Goel, An introduction to air pollution, BS publications, Hyderabad, 2nd Edition, 2005

15. Ibanez Gomez, “Transport Economic – Legacy of John Mayor”Kennedy School of Harvard University, 2009

16. Howitt, Arnold M., and Altshuler, Alan, “ The Politics of Controlling Auto Air Pollution”, The booking institution, 1775, Massachusetts Avenue, N.W. Washington D.C, 20036, 2001

17. Katherine O. Blumberg, Michael P. Walsh, Charlotte Pera LOW-SULFUR GASOLINE & DIESEL: THE KEY TO LOWER VEHICLE EMISSIONS, (www.unep.org/pcfv/PDF/PubLowSulfurPaper.pdf)

18. Opening the door to Cleaner Vehicles in Developing and Transition Countries: The Role of Lower Sulphur Fuels, A report of the Partnership for Clean Fuels and Vehicles (PCFV), 2010. (http://www.unep.org/pcfv)

19. World Health Organization (WHO), 2002, Reducing Risks, Promoting Healthy Life

20. MECA. 1998. The Impact of Gasoline Fuel Sulfur on Catalytic Emission Control Systems,Washington, D.C.: Manufacturers of Emission Controls Association

21. Shi, J. P., and R. M. Harrison. 1999. Investigation of Ultrafine Particle Formation during Diesel Exhaust Dilution. Environmental Science & Technology 33:3730–3736.

22. Wåhlin, P., et al. 2001. Pronounced decrease of ambient particle number emissions from diesel traffic in Denmark after reduction of the sulphur content in diesel fuel, Atmospheric Environment 35:3549–3552.

23. Darlington T., and D. Kahlbaum. 1999. Nationwide benefits of a low sulfur diesel fuel. Novi: Air Improvement resource, Inc.

24. EPA 2001. 2000 air quality trends report. Washington, D.C.: U.S. Environmental Protection Agency.