PNG Power Ltd should spearhead discussions with the Kumul Consolidated Holdings Ltd and consider the possibilities of alternative energy sources such as wind, gas-powered, coal and sea current which are abundant in our country.
After the discussions, PNG Power should work on a pathway to bring in investors through a public-private partnership arrangement.
The landowners should be included in any discussions in the arrangements.
PNG has a huge potential to generate more energy to meet the domestic market demands and create a significant supply for export market.
PNG has all the available resources to be the energy hub of Asia-Pacific because it has all the available resources to do it, and are already doing it with our major international partners and our strategic location as a bridge between Asia and the Pacific provides close proximity to large dynamic markets with growing opportunities.
PNG is fortunate to have been blessed with all the natural energy sources; both renewable and non-renewable.
We have significant proven reserves of fossil fuel from both oil, gas and coal.
We have large river systems that can produce up to 15,000MW of hydroelectric power and another 5,000MW from geothermal reservoirs according to established feasibility studies.
There are numerous channels and passageways in our maritime regions hold untold energy capacity from ocean currents yet to be explored.
All these energy sources are sufficient to meet our domestic requirements for power, transportation and industrial development as well as for export to neighbouring countries in our region and even beyond.
There are proposals to build transmission infrastructure both on land and undersea to deliver power to Australia and Indonesia from our hydro, gas and coal resources which should be given serious consideration by State Enterprises Minister Sasindran Muthuvel and the PNG Power Ltd management and board.
Another area where the new PNG Power’s boss needs to look into is the issue with system loses.
Systems losses consists of technical losses (e.g. heat generated in networks) and non-technical losses such as unbilled meters, metering errors and theft.
Technical losses account for 10-12 per cent.
The rollout of the Easipay systems appears to have reduced the non-technical losses.
A one per cent loss equates to K4 million loss.
System loss is calculated as the difference between energy generated (produced in megawatt-hour) and energy billed (sold megawatt-hour).
Internal audit reports consistently show that system losses account on average 18 per cent annually which equates to K800 million annually.
The losses if contained could improve revenue and profitability to the company.
The incoming managing director said that PNG Power is faced with serious issues of corruption, nepotism and political influence which has been a challenge. What he needs to do is to work alongside the company’s team of internal auditors to weed out these evils including putting in place effective measures to control cash flow.
Prudent cash flow management ensures positive working capital is available to sustain any operations by meeting obligations as and when they fall due.
The Easipay programme was initiated to reduce the prevailing aged debtors’ issues within the company.
The company has struggled over the years to collect its aged outstanding debtors resulting in millions being written off annually.
The Easipay system which is meant to operate on a prepaid basis carries extensive debts that is proving difficult to collect.
We welcome the new managing director and hope the issues highlighted here are taken seriously by Minister Muthuvel, board chairman Peter Nupiri and his board and the Government if we are to seriously address the power issues in this country.
If there is a will, there will be a way.
Pawa Man, Port Moresby