New World Bank project to support urgent improvements to electricity infrastructure,
and drive improved performance from PNG Power Limited
WASHINGTON, April 5, 2021: The World Bank’s Board of Executive Directors has approved a US$30 million (PGK105 million) project to support improvements to the operational and financial performance of PNG’s state-owned electricity provider.
The PNG Energy Utility Performance and Reliability Improvement Project (EUPRIP) comes at a crucial time for PNG, with Papua New Guineans across the country facing major challenges with poor access to electricity, and even for those with access; unreliable power supplies and lengthy blackouts that are impacting homes, businesses and the delivery of critical services.
While PNG has significant untapped energy resources, the development of these resources is lagging and the country’s electricity access remains extremely low, with only an estimated 13 percent of PNG’s 8.6 million people having access to grid-connected electricity.
The new project, which is expected to be implemented between 2021 and 2026, will help establish a strong foundation for PPL to become financially sustainable and catalyze private investments in the energy sector. Works as part of the project include the rehabilitation, reinforcement and upgrade of infrastructure on the Port Moresby, Ramu and Gazelle grids owned and operated by PNG Power Limited (PPL).
The project will also support improvements to the management and financial sustainability of PPL, with the focus on improving service quality to consistently meet higher standards. Support will include assistance to PPL in developing its corporate reform plan, including installation of smart meters and new technology applications. In addition, the project will contribute to reducing the cost of power generation and transitioning to sustainable, renewable energy through the preparation and implementation of a Least Cost Power Development Plan for PPL.
“Providing affordable and reliable power to the population in PNG remains central to the PNG Government’s development plans and it requires a well-functioning service provider,” said Hon. William Duma, Minister State Enterprises. “The World Bank-funded PNG Energy Utility Performance and Reliability Improvement Project is set to help PPL play a major role in the Government’s vision of connecting 70 percent of the population to electricity by 2030, as outlined in the PNG 2010-2030 Development Strategic Plan.”
“PPL is embarking on major corporate reform initiatives,” said Flagon Bekker, Managing Director of PPL. “We look forward to working alongside the World Bank team to put in place critical improvements that will ultimately deliver stronger, more reliable energy for all Papua New Guineans.”
“Access to reliable, affordable electricity is central to economic development; businesses, schools, hospitals and clinics, among countless other services in PNG, all need reliable, affordable power to keep the country growing,” said Stefano Mocci, World Bank Country Manager for Papua New Guinea. “This new project builds on the groundwork delivered through the World Bank’s Energy Sector Development Project, which helped prepare PNG’s National Electrification Rollout Plan, and geospatial assessments to plan optimal approaches to provide electricity to 70 percent of the country’s population by the year 2030.
“We’re proud to be helping ensure more Papua New Guineans can get connected – and stay connected – to reliable, affordable electricity in the years ahead.”
The World Bank currently supports nine active projects in PNG valued at approximately US$455 million, in sectors including agriculture, health, road transport, water and sanitation, energy, rural service delivery and youth employment.