The government conveyed the decision to the Supreme Court yesterday in response to a complaint filed by an environmentalist organisation.
Sri Lanka's Minister of Power and Energy Ranjith Siyambalapitiya told reporters that the decision to stop the joint venture with India was taken to reduce the use of coal as a power generating source.
"The decision is limited to doing away with using coal as a power generating source. It doesn't mean that a power plant would not be built in Sampur," Siyambalapitiya said.
The government, however, has not said who will assist in building the power plant.
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"There is a strong school of thought that coal fire would be a cheaper source for power generation as opposed to other sources," Siyambalapitiya said.
The decision to stop the coal fired plant at Sampur town in Trincomalee was due to environmental concerns, he said.
"The government has taken a policy decision to minimise the use of coal for power generation," he added.
The Sri Lankan government on Tuesday had told the Supreme court that it will not go ahead with the joint venture after strong objections from environmentalists and the public.
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