Plans to boost electricity

STATE Enterprises Minister Sasindran Muthuvel says the Government is mulling joint-ventures (JVs) with super funds and provincial governments to enhance power generation nationwide.
“When the World Bank Master Plan for PNG Power Ltd is ready, we will identify potential generation sites and negotiate with the super funds and provincial governments,” he told The National.
Muthuvel said the World Bank had already been commissioned to undertake a comprehensive study to plan the future power generation requirements in line with the Government’s priority to bring down the cost of electricity.
“The preliminary report found renewables and gas are the best power generation options in the near to medium-term, hydro-power being the least cost option in the long-term.
“We now have World Bank energy specialists undertaking a further exercise to identify specific investments that we should pursue to deliver on the plan.
“We will explore options to privatise power generation to bridge efficiency and reduce cost. The strategy is to forge strategic partners with industry experience and also have the capital to improve business and avoid political interference,” he added.
Muthuvel said the cost of electricity in Papua New Guinea was one of the highest in the world due to years of poor planning and mismanagement.
“This was partly the result of allowing low-cost assets such as hydro to deteriorate while they pursued expensive diesel generation.
“This highlights a key problem in our power sector – it has been developed without any clear plan, often reflecting the interests of private foreign interests who want to sell us power on their terms.
“While the current load shedding are immediately due to outstanding fuel bills and also outstanding power bills from our debtors, the underlying cause is the failure to manage the development of the power sector in line with the national interest to reduce the cost of power.
“We are addressing this as a matter of urgency but it does take time to fix the systemic problem.
“We are taking urgent action to pursue a fuel switch in the Ramu Grid in line with World Bank recommendations.
“The quickest way to resolve this fuel issue is to grant the license to ExxonMobil to supply gas to NiuPower and Dirio power. We can generate immediately and become cash flow positive in February 2020,” he added.