Power purchase agreements still new for Pacific
25 May, 2018, 9:30 am
WHILE power purchase agreements are an effective tool for attracting private sector investments in the area of renewable energy and efficiency, it is still very new to the Pacific Islands.
But to be able to structure successful power purchase agreements particularly in the region, a training workshop facilitated by the Pacific Community (SPC) aims to enable participants to structure successful power purchase agreements.
The objectives of the workshop are to enable participants to structure successful power purchase agreements, to manage competition in the electricity market and attract power sector investments and to provide inputs to the drafting of a power purchase agreement template for the Pacific Islands.
A power purchase agreement (PPA is a contract or agreement between two parties, one which generates electricity and sells it which the other purchases this electricity.
Fiji’s energy economy has potential for significant investment over the next decade which cannot be financed by the public sector alone.
Realising this, key stakeholders and Government has made efforts to attract private investment into new electricity generation capacity.
For example, Government had provided incentives to Independent Power Producers (IPP) to sell electricity to the FEA grid.
This will capitalise on the diverse renewable energy resources available in Fiji and also reduce the import bills which includes bio fuel program as an alternative to imported fossil fuels.
The event Power Purchase Agreements workshop, which will be held from Monday May 28 to May 31 in Auckland New Zealand, will be attended by regional organisations, Pacific Island countries and territories energy planners.
This will also include energy regulators, power utility executive officers/board members, banks/investors, independent power producers as well as lawyers and consultants from around the Pacific.
Fiji will be represented by a private sector participant from Pernix (Fiji) Ltd, a company which is under contract with Energy Fiji Ltd (EFL) to operate and maintain two separate power generation plants, Kinoya and Vuda, and to sell electrical energy produced, on a wholesale level.
Pacific Community (SPC) Deputy Director Georesources and Energy Akuila Tawake will open the training workshop.
In April 2017, Pacific Energy Ministers met and adopted a vision for the Pacific to be 100 per cent on renewable energy and launched the Pacific Centre of Excellence for Renewable Energy and Energy Efficiency (PCREEE) as a vehicle for accelerating the progress towards their vision by empowering the private sector and the business community.
Achieving the region’s 100% renewable energy vision cannot be achieved without private sector investment. A Power Purchase Agreement is an effective tool for attracting private sector investments and is still very new to the Pacific Islands.