Solomon Islands (2012)

Degree of reliance on imported energy: 

<p>
All fuels have to be imported, amounting to 28-30% of the country&rsquo;s total imports. The small import quantities, long transportation routes, and frequently transhipments, often result in high costs of petroleum products in the country. The power generation infrastructure in the country is almost entirely based on diesel fuel.</p>

Main sources of Energy: 

<p>
Total installed electricity capacity (2010): 28 MW<br />
Diesel: ~100%<br />
<br />
Total Primary Energy Supply (2009, source: IRENA): 142.9 ktoe<br />
Biomass: 55%<br />
Oil and Products: 45%<br />
<br />
Kerosene is the main source of home lighting and wood for cooking. Of the rural households in 2009, 98.7% used an open fire for cooking and 79% used a kerosene or spirit lamp for lighting.<br />
<br />
The serviceable capacity of the electric power system of the country totals 22.1 MW. Power generation in the provinces of the country amounts to 4.6 MW.&nbsp;<br />
<br />
Power generation was about 74.5 GWh in 2010, of which about&nbsp; 90% was in Honiara. Diesel-fuelled power generation accounts for 100% of the total power generated in the Solomon Islands. The islands are totally reliant on imported petroleum products for power generation.</p>

Country: 

Solomon Islands

Extent of the network: 

<p>
Throughout the Solomon Islands, less than 16% of the population is grid connected. In Honiara, 72 % of the households have electricity but the number of connections is declining. The Solomon Islands Electricity Authority (SIEA) is unable to connect new customers, and with customers unable to pay the high costs (US$ 0.55/kWh in 2008), disconnections increase.&nbsp; In rural areas, where 85 % of the population lives, less than 10% of households have access to electricity.<br />
<br />
Of the households with electricity 69% received power from SIEA. Outside Honiara, only 41% of electrified households had SIEA service, 28% had their own source, and 23% reported that they received electricity from a private company. Also many businesses have their own generator due to frequent SIEA outages.</p>

Capacity concerns: 

<p>
During the period of ethnic tension (before 2003), available power generating capacity in Honiara gradually declined.&nbsp; Long overdue maintenance needs on the distribution network are causing outages in Honiara to some 72 hours per week on average. Frequent interruptions and low-power supply quality often damage consumer electrical equipment.<br />
<br />
SIEA&rsquo;s operating losses (after financing charges) increased from SB$ 12m in 2005 to about SB$45 m in 2007, equivalent to about 30 % of total operating revenue. Exacerbating the situation was a decline in SIEA&rsquo;s bill collection efficiency from 84 % to about 72 % in 2007.<br />
<br />
The situation has improved considerably since inception of World Bank-AusAid project &ldquo;Solomon Islands Sustainable Energy Project-SISEP&rdquo;to re-structure the utility. Although slow to improve in the initial stage of the project, SIEA improved its cash flow towards the end of 2011 having recovered from a close-to-insolvency situation experienced earlier in the year. The result of the turn-around in cash flow position of SIEA was attributed to SIEA focusing on&nbsp; key aspects of the commercialization process that SISEP supports..<br />
<br />
The Solomon Islands have some of the highest electricity commodity prices in the world, and fuel imports are prohibitively expensive for the expansion of electricity provision to the population.</p>

Potential for Renewable Energy: 

<p>
<b>Solar energy</b><br />
As the Solomon Islands lies near the equator, there is considerable solar energy potential, with insolation values of 5 kWh/m2/day or higher, among the highest levels in the region. A number of small-scale and demonstration projects are operational in the islands, including solar home systems (SHS) provided through Government funding since 2011 while Government of Republic of China (Taiwan) has since 2009 supplied SHSs for all constituencies in the country and solar systems for rural schools. The respective Governments&rsquo; of Italy &amp; Turkey have complemented the Government of Solomon Islands program to provide solar lighting for rural-based schools including boarding ones and rural clinics. On 28 September 2012, the Government will launch a 2 years-pilot project on installation of SHSs for 2000 households in the country that would requires each household to pay cost of installation (including transportation) and operation &amp; maintenance costs over the 2 years period. RESCOs contracted by the Government will install the SHSs and service the systems over the life-time of the pilot phase. This project is funded under the Pacific Environmental Fund (PEC) provided by the Government of Japan to the Pacific Islands countries following commitment made Government of Japan at the Fifth Japan-Pacific Islands&rsquo; Leaders Summit.<br />
Depending on the outcome of the pilot phase, the Government plans to roll-out this programme to cover rest of the rural population.. There was a solar lighting scheme through SOPAC/REEEP co-operation, with tailored financing mechanisms, allowing recipients to pay for installations via non-fiscal means, for example with crop production.<br />
<br />
<b>Hydropower</b><br />
There is substantial hydropower potential. However, dams and storage reservoirs would be technically difficult and expensive, limiting most sites to run-of-river schemes.&nbsp;&nbsp; The government developed a database of over 100 sites for possible small hydro development, of which 62 have an estimated overall capacity of 11 MW. A Japan International Cooperation Agency study estimated the total hydroelectric potential of the country to be 326 MW. A feasibility study conducted by the Government, with support from the World Bank and the Government of Australia, proposed a 15 MW hydropower development on the Tina River near Honiara, with an annual electricity production of 60 GWh.<br />
Feasibility studies on the Tina River hydropower scheme proposed for Honiara is continuing. With assistance from ADB, feasibility studies will be conducted by end of 2012 on 5 small-scale hydro schemes for provincial centres to reduce SIEA&rsquo;s use of diesel-based power generation at these towns.<br />
<br />
<b>Wind energy</b><br />
There are no data on the Solomons&rsquo; wind energy potential. Nonetheless, wind would be a costly option, because of the variable wind regime together with the need to design equipment for typhoon conditions. Through the Pacific Islands Greenhouse Gas Abatement and Renewable Energy Program (PIGGAREP), in conjunction with the country&rsquo;s governmental Energy Division, requests for quotation for four wind monitoring systems for the island were made in early 2011, so that the wind resource potential of the islands may be assessed. The wind towers are expected to be installed by end of 2012 at four locations around the country.<br />
<br />
<b>Ocean Based</b><br />
The sea wave energy potential has not been assessed. Extrapolating from results from Fiji and Vanuatu, annual average wave power could be roughly 14 kW/metre of wave front, with a wide range varying by site.<br />
<br />
<b>Biomass </b><br />
The Solomon Islands is heavily forested. Palm oil and copra are major agricultural commodities. Traditional biomass use is still relatively widespread in the unelectrified regions of the country. A large palm oil plantation closed in 1999 due to ethnic tensions but has re-opened and has increased its production. In the mid 1980s, copra output exceeded 40,000 tonnes, enough to produce an equivalent of 28 ML of distillate, sufficient to displace about half of current diesel fuel imports. Economic opportunities for biomass for power generation are, however, very limited. No dedicated study has been conducted on the potential for biomass power generation in the islands.<br />
<br />
<b>Geothermal energy</b><br />
There are indications of exploitable geothermal resources in at least four locations, with an estimated potential of 10 MW. The two main geothermal areas are the Nggurara and Paraso Bay geothermal fields, with hot spring temperatures in the 30-90 degrees Celsius range.<br />
In March 2012, the Government issued prospecting license to Kentor Energy Pty Ltd to prospect for geothermal resource on the island of Savo (off-shore of Honiara).&nbsp; The company will commence investigative survey work in October 2012 with the objective of supplying power into the main grid (via submarine cables) hopefully by 2016&nbsp; if the project is viable.<br />
&nbsp;</p>

Potential for Energy Efficiency: 

<p>
Lighting, refrigeration and air conditioning are major energy consumers in buildings and there is potential for making energy savings and reducing CO2 emissions by replacing inefficient lamps and refrigerators with high efficiency alternatives, or by proper maintenance and introducing more efficient air conditioners and controls. Significant energy efficiency potential also exists on the supply side, with a lack of maintenance contributing heavily to transmission and distribution losses, which are particularly expensive in the country due to the high cost of importing fuel.</p>

Ownership: 

<p>
The <i><b>Solomon Islands Electricity Authority (SIEA</b></i>, http://www.siea.com.sb/), a Government-owned statutory body, is responsible for power supply and distribution to all urban and provincial centres. It was established in January 1969 by an Act of Parliament as a &lsquo;Body Corporate&rsquo; as the sole manager and operator of electricity generation, transmission and distribution installations transferred to it by the Government.<br />
<br />
The provision of energy services to other parts of the Solomon Islands apart from the areas serviced by SIEA has attracted the interests of the private sector and civil society groups. A number of NGOs in the SI are actively participating in developing rural electrification projects.<br />
<br />
There is no upstream oil industry in the country, and exploratory measurements have not been undertaken. Private companies are active in the downstream oil sector, including Origin Energy (Aus), active in LPG imports, as well as South Pacific Oil Ltd (bought Shell&rsquo;s assets) and Markwarth Oil Ltd, both of whom are locally-registered companies.</p>

Structure / extent of competition: 

<p>
The government owned energy utility, the Solomon Islands Electricity Authority (SIEA), has recently started cooperation with some Independent Power Producers. This is part of a new policy to encourage public-private partnerships in energy generation and retail.<br />
<br />
The SIEA is vertically integrated, combining generation, transmission and distribution, like many of the energy and electricity utilities in the Pacific.</p>

Existence of an energy framework and programmes to promote sustainable energy: 

<p>
Since approximately 2007, there is a <i><b>National Energy Policy Framework</b></i> in place, implemented through the Pacific Islands Energy Policy and Strategic Action Planning (PIEPSAP) project. The National Energy Policy Framework has been endorsed by Cabinet of Solomon islands Government in 2007.<br />
<br />
The World Bank has started a Sustainable Energy Finance Project in 2007, aiming to significantly increase the adoption and use of renewable energy technologies in participating Pacific Island states (including the Solomon Islands) through a package of incentives to encourage local financial institutions to participate in sustainable energy finance in support of equipment purchase. In the Solomon Islands, it specifically targets the SIEA, aiming to strengthen the institutional and financial capacity of the Authority through management training and improvements in revenue collection, as well as technical capacity in terms of rehabilitation of the distribution network, and sustainable energy-specific technical training.<br />
&nbsp;</p>

Current energy debates or legislation: 

<p>
The spikes in fuel prices have triggered the governments of the Pacific Islands and the donor community to seek to seriously reduce the burden of fossil fuel imports on the national budgets and tackle the impacts of climate change.<br />
<br />
A wide range of options, including renewable energy and energy efficiency, are currently being discussed.<br />
<br />
Solomon Islands aim to achieve 50% of electricity from RE sources is based on scenario that Tina River hydropower project would bring as it targets Honiara grid which&nbsp; in 2010 produced 74.5Gwh. Tina River Hydro is estimated to produce annual energy of 60Gwh, achieving the aim of reduction by 50%. Due to delays in project time-line, the aim may now be realized by 2016.</p>

Major energy studies: 

<p>
The Pacific Islands Renewable Energy Project (PIREP), carried out by Pacific Regional Environment Programme (SPREP), is a little bit outdated but valuable source of information.</p>
<p>
In addition, the current World Bank projects on sustainable energy in five selected countries in the Pacific, including the Solomon Islands, are good sources of information.<br />
&nbsp;</p>

Role of government: 

<p>
The Energy Division of the Ministry of Mines, Energy and Rural Electrification currently bears responsibility for legal and regulatory development and institutional strengthening. The Division is currently staffed with 15 officers. Capacity building through training is needed</p>

Government agencies in sustainable energy: 

<p>
There is no national energy committee or other mechanism to coordinate energy sector issues. There is a climate change committee, instituted under the auspices of the Solomon Islands Meteorological Service, to monitor and approve measures to combat climate change in the islands. However, reportedly, the committee rarely meets, and has little impact.</p>

Energy planning procedures: 

<p>
The responsibility for energy planning should be part of the Energy Division of the Ministry of Mines, Energy &amp; Rural Electrification. The Pacific Islands Energy Policy and Strategic Planning (PIEPSAP) project is supporting the implementation of effective planning strategies, including the National Energy Policy Framework, currently the dominant energy policy and planning document.</p>

Energy regulator Date of creation: 

<p>
There is no independent energy regulator. The <b><i>Solomon Islands Electricity Authority (SIEA)</i></b> could be seen as a form of electricity regulator, although they are also in charge of generation, transmission and distribution.</p>

Degree of independence: 

<p>
The SIEA is 100% state-owned. The SIEA is accountable to the Minister for Mines and Energy, who appoints the Directors, and reports to the Minister via the Permanent Secretary. Through the newly enacted 2007 State-Owned-Enterprises (SOE) Act, SIEA is also accountable to the Minister of Finance &amp; Treasury.</p>

Regulatory framework for sustainable energy: 

<p>
No dedicated regulatory framework exists for the promotion of sustainable energy.</p>

Regulatory roles: 

<p>
Regulation of state-owned enterprises is the responsibility of the enterprise itself, under authority from the Ministry of Finance, according to the 2007 State-owned Enterprises Act.</p>

Role of government department in energy regulation: 

<p>
The Energy Division of the Ministry of Mines, Energy &amp; Rural Electrification is responsible for energy policy, and monitoring the SIEA. No other government department takes an active role in energy regulation.</p>

Regulatory barriers: 

<p>
Private sector involvement in sustainable energy is not fully institutionalised yet in the Solomon Islands. Although there are some signs that the SIEA is moving towards more public-private arrangements, in order to establish an efficient regulatory framework some structural changes in the various institutions in the energy sector still have to be made. The establishment of an independent regulatory body, as well as a dedicated regulatory framework for energy, particularly sustainable energy uptake, would create a more favourable environment for sustainable energy development.</p>

References: 

World Bank (WB) (n.d.) Solomon Islands - Pacific Islands and Energy. Available at: <a href="http://go.worldbank.org/IG7LJ4UWY0">http://go.worldbank.org/IG7LJ4UWY0</a> [Accessed 14th September 2013]<br />
<br />
IRENA (2010) Renewable Energy Country Profile - Solomon Islands. Available at: <a href="http://www.irena.org/REmaps/countryprofiles/solomon.pdf">http://www.iren... [Accessed 14th September 2013]<br />
<br />
Solomon Islands Electricity Authority (2012) Current Tariffs, last updated 2nd Quarter 2013. Available at: <a href="http://www.siea.com.sb/index.php?q=node/16">http://www.siea.com.sb/index... [Accessed 14th September 2013]<br />
<br />
e7 Renewable Energy Workshop (2005) Solomon Islands Electricity Authority Presentation. 14-25 November, 2005. Available at: <a href="http://www.globalelectricity.org/projects/fiji/Attendees_fichiers/Presen... [Accessed 14th September 2013]<br />
<br />
SPREP (2011) Solomon Islands Wind Monitoring and Resource Assessment Project. Available at: <a href="http://www.sprep.org/att/publication/000962_SI_Wind_RFQ___final.pdf">htt... [Accessed 14th September 2013]<br />
<br />
Asmundssen, R.K. (2008) South Pacific Islands - Geothermal Energy for Electricity Production. Available at: <a href="http://www.edinenergy.org/pdfs/pacific_islands_geothermal.pdf">http://ww... [Accessed 14th September 2013]<br />
<br />
Solomon Islands Electricity Authority (2010) Who We Are. Available at: <a href="http://www.siea.com.sb/index.php?q=node/3">http://www.siea.com.sb/index.... [Accessed 14th September 2013]<br />
<br />
Origin Energy, Solomon Islands. <a href="http://www.originenergy.com.au/122/Solomon-Islands">http://www.originene... [Accessed 14th September 2013]<br />
<br />
SPREP, Matakiviti, A. (2010) National Policy Framework, Solomon Islands. Available at: <a href="http://ict.sopac.org/VirLib/PI0039.pdf">http://ict.sopac.org/VirLib/PI00... [Accessed 14th September 2013]<br />
<br />
World Bank (WB) (2012) Sustainable Energy Project for Solomon Islands. Available at: <a href="http://web.worldbank.org/external/projects/main?pagePK=64312881&amp;piPK... [Accessed 14th September 2013]<br />
<br />
Scoop Independent News (2011) Renewable Energy in the Solomon Islands: Making A Difference. Available at: <a href="http://www.scoop.co.nz/stories/WO1107/S00171/renewable-energy-in-the-sol... [Accessed 14th September 2013]<br />
<br />
SPREP (n.d.) Pacific Adaptation to Climate Change - Solomon Islands. Available at: <a href="http://www.sprep.org/att/irc/ecopies/countries/solomon_islands/58.pdf">h... [Accessed 14th September 2013]<br />
<br />
Government of the Solomon Islands (2007) The State Owned Enterprises Bill 2007. Available at: <a href="http://www.parliament.gov.sb/files%5Clegislation%5CStateOwnedEnterprises... [Accessed 14th September 2013]<br />