COLOMBO: Sri Lanka’s government announced Tuesday it had tapped an Australian company to build the island nation’s largest solar energy plant at an expected price tag of $1.7 billion.

An unprecedented economic crisis last year saw Sri Lanka hit with blackouts of up to 13 hours each day as power generators ran out of funds to pay for fossil fuel imports.

The government has since fast-tracked a number of renewable energy proposals to diversify the island’s grid.

Energy minister Kanchana Wijesekera said the government had approved plans to buy electricity from a proposed 700-megawatt plant to be built by Australia’s United Solar Energy.

Solar panel, allied equipment manufacturing: Govt decides to identify, plug policy gaps

The facility in northern Kilinochchi district will be financed by $1.7 billion in foreign direct investment, he wrote on X, formerly known as Twitter.

The plant would be Sri Lanka’s largest renewable energy scheme so far.

Colombo approved in February a $442 million investment by India’s scandal-hit Adani Group to build a 350-megawatt wind power plant, also in the island’s north.

Sri Lanka’s economic crisis saw widespread shortages of food, fuel and medicines last year when the country ran out of foreign exchange to pay for imports.

President Ranil Wickremesinghe, who took office after public protests against the crisis prompted the ouster of his predecessor, has committed Sri Lanka to an International Monetary Fund rescue plan to restore the nation’s finances.