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Energy project payments delayed

Saturday December 22, 2018 Written by Published in Environment

Delays by the Asian Development Bank (ADB) in making payments to the contractor working on the Cook Islands renewable energy project will not delay the ambitious venture.

 

According to a report in the recently released 2018/19 Half-year Economic and Fiscal Update, the contractor involved has been experiencing major delays in receiving payments from the Asian Development Bank (ADB).

This is due to funds from European Union (EU) being transferred to ADB later than normal, the report added.

Despite the disbursement delays, an official at the renewable energy division at the Office of the Prime Minister said the project, which aims to deliver renewable energy to all of the islands by 2020, was “on track”.

The official, who asked not to be named, added the contractor had a good working relationship with the Cook Islands government and had continued with the project despite the payment delays.

“ADB and the EU are working closely to find a solution to resolve the issue,” the report added.

“The programme has a blended funding arrangement, primarily the ADB loan and grant financing support from the European Union (EU), Global Environment Facility (GEF) and the Green Climate Fund grant. All grant financing is administered by the ADB.”

The report said government aimed to increase power generation from renewable sources and enhance its institutional capacity for implementing the Cook Islands Renewable Energy Chart Implementation Plan (CIRECIP), 2012–2020. This sets a target of supplying electricity from renewable energy sources to all inhabited islands, by 2020.

The goal of the Renewable Energy Programme Support is to establish a solid foundation for renewable energy sector development and operations in the Cook Islands.

“The Southern Group Renewable Energy Programme is well underway for the Cook Islands Renewable Energy Sector Project (COO46453-002). Significant progress has been made for all Phase 1 islands (Atiu, Mitiaro, Mauke and Mangaia), with all Phase 1 islands are now fully running on the new renewable power systems,” the report said.

“The first additional financing provided by GEF6 will be used for the battery energy storage system (BESS) installation at the Solar PV facility at Rarotonga International Airport for integration into the existing power system infrastructure.

“This BESS contract was awarded to a supplier on June 1, 2017 for a fixed price of $4,562,515. A variation for $103,000 was agreed in August 2018 to allow a larger transformer sizing to take advantage of latent BESS PCS and battery capacity.

“While progress of this work has been slow, the BESS has been installed on site and most pre-commissioning tests have been successfully completed and is awaiting approval from the project owners’ engineer. Commissioning of the BESS, contracted for April, is now scheduled for November.”

The project is funded by ADB, the EU, the Global Environment Fund (GEF), Japanese government through the Pacific Islands Forum Secretariat (Pacific Environment Community Fund or PEC), the Green Climate Fund through ADB’s Pacific Islands Renewable Energy Investment Programme, New Zealand and the Cook Islands governments.