A Paradigm Shift for Sustainable Energy in the Pacific

As large sums are invested in renewable power in the Pacific, these investments’ sustainability is uncertain if the viability of SOE power utilities is not assured. ADB is assisting utility companies in the Pacific by conducting a comprehensive diagnostic review of their operations and the environment in which the utility operates. The review covers financial management and accounting, operational procedures, maintenance practices, customer billing systems; as well as external factors, such as SOE governance, regulation, and relevant government policies. Based on the work in the seven utilities in four Pacific countries to date, findings indicate that Pacific utilities have developed over the years under a variety of misguided (if well-intentioned) government mandates, inappropriate governance and management structures, and regulations and tariff policies that are out of step with what is needed for sustainability and commercial viability. The need for a dramatic shift in paradigm is abundantly clear.