20 July, 2010—Energizing the Pacific aims to address a range of energy sector issues across Pacific island countries including:
- Heavy reliance on imported petroleum for power generation which makes countries vulnerable to budget shocks and balance of payment problems resulting from oil price shocks;
- High cost and sometimes unreliable electricity supply which negatively impacts on the competitiveness of the existing private sector and deters new business and investment; and
- Low access to electricity in rural areas which limits economic activities, quality of social services and improvements in quality of life.
The initial focus of the Energizing the Pacific initiative is on policy and planning to identify priorities, address barriers and prepare investments. Subsequent stages will support the investments identified as a result of least-cost planning, taking into account risks associated with heavy reliance on imported petroleum for electricity generation. Fundamental to the initiative is improved development partner coordination. The overall goal is to ensure that economic and social development in the Pacific is not constrained by inadequate or unsustainable energy systems.
This initiative is based on two key principles:
- Build on what is already in place; and
- Undertake necessary data gathering, analysis and planning in parallel with implementing urgent investments.
To enhance development partner coordination, an Energy Development Partners Working Group was formalized in early 2009 as an important forum for the exchange of information and coordination of assistance. The members of this group include multi-lateral and bi-lateral agencies active in the energy sector in the Pacific as well as representatives from Pacific regional organizations with an interest in energy sector issues. This is an important forum for exchange of information and ideas among development partners, as well as a regular opportunity for Pacific island representatives to engage with the development partner group.
Across the Pacific, some key areas that the group is working on addressing are:
- Improved efficiency in petroleum supply chains and consideration of price risk management strategies;
- Improved efficiency of utility operations;
- Sector frameworks detailing: institutional strengthening, least cost planning, and investments to increase both on-grid and off-grid electricity supply reliability and access;
- Improved regulation of private sector energy operations;
- Opportunities for development aid to help expand private sector participation in existing as well as new geographic markets; and
- Coordinated development partner support and help in the energy sector-wide planning and policy development.
The process of developing the Tonga Energy Roadmap (TERM) is an example of the early stages of the initiative. Implementation of the TERM indicative implementation plan with coordinated support from a wide range of development partners, is set to begin in the coming year. Initial discussions are underway with the Governments of Kiribati and Vanuatu to embark on a similar process, under the framework of the Energizing the Pacific initiative.