Hopes are high that an action plan to resolve the problems facing Papua New Guinea’s three main power grids will be endorsed at a key stakeholders’ meeting in Port Moresby this week, according to Gavin Murray, the International Finance Corporation’s (IFC) Country Manager for the Pacific region.
Papua New Guinea’s grid development plans are being reviewed, with the aim of setting the priorities for upgrading the PNG’s major existing grids—Port Moresby, Ramu, and Gazelle—Murray told Business Advantage PNG.
According to the Asian Development Bank, PNG currently has power generation capacity of around 580MW, but will need an estimated 2000MW of installed capacity by 2030 to keep pace with government targets.
Earlier this year, an agreement between the PNG Government and ExxonMobil resulted in an additional 25MW of electricity being fed into the power supply for Port Moresby city.
Despite that, business leaders report brown-outs continue in Port Moresby and elsewhere.
The current drought has seen water levels at the Sirinumu Dam, which provides hydro-power electricity to Port Moresby, causing shortages in the capital, which is heavily reliant on hydropower for base load power.
PNG Power reported in September that dam levels were down to just 45%, prompting the introducing of indefinite load shedding (or rolling blackouts).
Everyone knows the issues, says Murray.
‘We know of a number of parties who are interested in investing in renewable energy and gas-to-electricity options and we’ve also been to talking to clients and the private sector about the impact of power shortages and remedial costs on their businesses,’ says Murray.
‘We are looking at how to match demand along the existing grids with supply options in the short-term as well as network upgrade needs.
But using gas and diesel is far more expensive than hydro, according to Anthony Maxwell, Senior Energy Specialist at the Asian Development Bank. He told the ABC back in September that, while solar can be a good option, it is not reliable and not capable of providing baseload power.
Murray says IFC consultants have analysed the demand and supply dynamics to update the grid development plans resulting in the draft action plan.
‘The Action Plan will identify the key steps required to improve the grid systems in terms of access, reliability, affordability and sustainability.
‘The essential challenge is implementation, so agreeing roles and responsibilities for each of the tasks within the Action Plan will be key.
‘PNG Power will hopefully accept the action plan as a useful tool for them to prioritise their financial and human resources.’
PNG Power issues
In recent times, state utility PNG Power has experienced structural and management issues.
In April, State Enterprises Minister Micah forced changes to the board, following a state of emergency earlier in the year, following revelations the company was facing revenue problems because of non-payment of bills totalling US$77 million (K155 million).
Changes to the board were made, with the CEO of Digicel PNG, John Mangos, appointed as Executive Director, with John Tangit being retained as Chief Executive Officer.
According to PNG Power’s management office, Mangos left the company last Friday and Chief Operating Officer John Yanis is now Acting CEO.