Power generation needs attention

IT is not fair for PNG Power’s paying customers who are forced into putting up with the current loading shedding or total blackout because debtors such as the Government owe the power supplier millions in arrears.
“PNG Power continues to struggle to meet payment obligations to its critical suppliers while at the same time also awaiting outstanding bills the National Government owes PNG in arrears totalling up to K38 million,” PNG Power acting CEO Douglas Mageo said earlier this month.
The bottom line – a financial crisis that has confronted PNG’s state power utility has become a national debt problem.
PNG Power is not financially sustainable based on its current high levels of debt and its inability to generate sufficient revenue to meet its operational and capital obligations. It needs a complete overhaul in its entire operation.
State Enterprises Minister Sasindran Muthuvel said the current load shedding was due to outstanding fuel bills and bills from its debtors.
However, 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.
PNG Power is responsible for the generation, transmission, distribution and retailing of electricity in the country.
Lack of funding for upgrading and rehabilitation and even for routine maintenance has led to a further deterioration in services, while the anticipated rise in demand due to economic growth and an increasing population has further stressed the system.
Currently PNG Power is unable to meet the electricity demand in the country with its aged infrastructures.
While the paying customers – individuals and business houses continue to faithfully pay their dues, one group have found loopholes in the PPL system by stealing power which is costing the entity millions of kina every month.
Major and serious reforms should be undertaken if PNG is to meet the target of delivering electricity to 70 per cent of households in 2030 and 100 per cent access through renewable energy by 2050.
Today, there is only 13 per cent electricity access to PNG households since electricity became publicly available in 1963.
Fifty-five years later and to hit the target of 70 per cent in 12 years’ time is a daunting task.
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.
Lifting electricity supply has been identified as one of the key goals of the country’s Development Strategic Plan.
But progress has been extremely limited – with a lack of funding, a complicated government and regulatory regime, and the difficulty of delivering services in one of the world’s most rugged and diverse countries, where four in five people live in traditional rural settings.
A country can move forward if it has a good source of power generation with the transmission and distribution system.
Generating low-cost electricity is the key to the development of a growing country.
The National Executive Council last year approved the National Energy Policy (2018-2028) which will see the delivery of reliable and affordable energy to the country.
The policy encourages competition in generation, transmission and distribution of power.
PNG can no longer rely only on one or two companies to deliver the Governments accessibility targets of 2030 and 2050.
It is time to allow licenced Independent Power Producers (IPP) to enter the market and use their experience to establish standalone power systems.