Solomon Islands Gets US$13 Million Boost to Improve Efficiency and Reliability of Electricity Services in Honiara

March 22, 2014

WASHINGTON, D.C, March 21, 2014 – The World Bank’s Board of Executive Directors today approved US$13 million in additional financing to Solomon Islands for the Sustainable Energy Project (SISEP), which is working to improve the operational efficiency, system reliability and financial sustainability of the national power utility, the Solomon Islands Electricity Authority (SIEA).

The SISEP project began in 2008 and has supported the financial turn-around of the SIEA. This new funding will build on this success and support the SIEA’s efforts to strengthen the capacity of its main power grid to meet consumer demands for improvements in the reliability and efficiency of electricity supply. 

The new funding will be used to finance capital investments to strengthen SIEA’s largest power grid in Honiara and improve the efficiency and reliability of power supplies; strengthen project management capability to execute capital works activities; and build capacity in such areas as power system dispatch and control, power system planning, integration of intermittent renewables and Independent Power Producers (IPPs), and transaction advisory services.

Electricity is critical for every area of development - including delivering clean water to households, running schools and hospitals, and enabling businesses to grow and expand. While the majority of households in Honiara are connected to the main SIEA grid, for many years the reliability and efficiency of supply have been poor,” said Tendai Gregan, World Bank Task Team Leader for the project.

“The Solomon Islands Government and the SIEA Board have been steadfast in their efforts to transform the financial performance of the SIEA, and the financial and operational improvements at the SIEA since 2011 have enabled it to now focus on planning and implementing long-overdue investments that will improve the reliability, efficiency, sustainability and affordability of electricity supplies across the country,he added.

Solomon Islands currently has one of the lowest rates of electricity access in the world and some of the highest electricity prices (over US$0.80 per kWh). In Honiara, which accounts for around 90 percent of the nation’s electricity generation and consumption, 64 percent of households are grid connected. Outside of Honiara, where 90 percent of the population lives, 6 percent of households are grid connected. The new investments to strengthen the Honiara distribution grid will significantly improve services to those who are already connected, and will facilitate providing access to the 36 percent of households in Honiara that are not already connected.

This additional financing consists of a grant and low-interest credit from the International Development Association (IDA), the World Bank’s fund for the poorest countries. 

Media Contacts
In Washington
Diana Chung
Tel : (202) 473-8357
In Sydney
Kym Smithies
Tel : (+61) 02 9235 6570
In Honiara
Alison Ofotalau
Tel : (+677) 21444