Basil sees power plan as opening for investors

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A DRIVE to provide 70 per cent of households with electricity in the country will provide opportunities for investments in energy, Minister for Energy Sam Basil says.
He told investors and delegates at a Sydney conference this week that the country’s energy sector had the potential to lift the standards of living in a big way for all Papua New Guineans in the next 10 years.
Providing an update and an overview of the major developments shaping the energy sector in PNG over the last 14 months, Basil said: “The Government has approved the national energy policy which provides the framework for development of all sources of energy, including hydro, solar, wind, biomass, gas, clean coal, geothermal and other sources.
“All sources of energy must be developed to meet the energy needs of PNG and hopefully in the not too distant future – for export.
“This diversified approach will protect our future energy generation and distribution assets against unforeseen natural disasters such as earthquakes and droughts.
“Majority of our reliance on energy is provided by heavy fuel oil and diesel.
“The Government’s energy policy and plans will ensure we are able to compete within Asia-Pacific in manufacturing, heavy industry and fisheries.”
Kumul Petroleum Holding Ltd’s managing director Wapu Sonk affirmed this critical need of cheaper energy access to manufacture cement and iron ore into steel together with other downstream vertically integrated industries.
Basil further said: “Creating the right policy and legislative environment is very important for PNG to compete for investment funds.
“Many governments around the world have introduced conducive policies to attract such investment.
“We will continue to work on right policies and regulatory environment to secure much needed investment funds dollars, including a return on investments in energy sector.
“Creative investment incentive initiatives will be considered to encourage local and foreign investors to develop all sources of energy.
“Some of these incentives will be generation-based incentives (GBI), similar to the experience of India. Others will be resource based; like solar, for example.
“There will also be other incentives for transmission, distribution and retail as and when required, especially in remote rural areas.
“Other incentives will include construction of infrastructure as contribution to equity participation by provincial governments and local-level governments.
“There will be an appropriate tariff structure for rural stand-alone and off-grid systems; in particular mini-grids to encourage investors to develop such systems. The Government has made generation of power an open market through the electricity industry policy.
“Further reforms through the new energy policy will result in the transmission, distribution and retailing of power supply markets open for competition by private sector investors.”
The national government has allocated K30 million in the 2019 Budget for rural electrification.
Basil also noted that the National Energy Authority Bill is now before Cabinet.

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