ADB, Japan, NZ To Help Papua New Guinea Rural Power Up

ADB, Japan, New Zealand To Help Papua New Guinea Power Up Rural Areas

PORT MORESBY, PAPUA NEW GUINEA (31 October, 2012) – A grant agreement was signed today to support the Government of Papua New Guinea (PNG), through PNG Power, to expand a community-based project which will deliver electricity to remote rural communities for the first time. The grant will be financed by the Government of New Zealand and the Government of Japan through the Asian Development Bank (ADB).

The signing ceremony was attended by Don Polye, PNG Treasurer, Murray McCully, New Zealand’s Foreign Minister, Satoshi Abe, Charged’ Affaires ad interim Embassy of Japan in Papua New Guinea and Marcelo Minc, Country Director of ADB’s Papua New Guinea Resident Mission.

“Helping communities tap their own resources to link to power grids and use electricity for income generating activities is critically important for stimulating growth and cutting poverty in rural areas,” said Anthony Maxwell, Senior Energy Specialist with ADB.

The project will trial the use of labor from local communities to install power lines, and provide training to households on the cost effective use of power to support new livelihood opportunities. It will be co-financed by grants of $2.5 million from the Japan Fund for Poverty Reduction and $2.5 million from the New Zealand government, with the Government of Papua New Guinea providing $1 million.

“New Zealand is proud to support this project which improves lives by delivering electricity to rural areas,” said Murray McCully, Foreign Minister of the New Zealand Government.

Around 10% of PNG’s population has access to electricity, with relatively fewer connections in rural areas. New hydro generating facilities and transmission lines are being rolled out by PNG Power to provincial centers under a separate ADB-financed electrification program, but the cost of linking rural communities remains prohibitively high, in part due to the expense of bringing in external contractors. The project aims to tackle the cost barrier by using local work teams to install distribution lines to remote communities.

“The use of local labor will contribute a direct injection of income to rural communities,” said Mr. Satoshi Abe, Charged’ Affaires ad interim, Embassy of Japan in Papua New Guinea.

The project will take place in the provinces of Northern Province, West Britain and Autonomous Region of Bougainville.

PNG Power will provide training and supervision for local labor hired to do construction work under the project. PNG Power will also conduct safety and energy efficiency campaigns targeting local people.

An equally critical component of the project is the installation of prepaid power meters in about 4,500 households, as well as community training to raise awareness on income generating opportunities and how to access microfinance. Workshops will be held on the safe use of power and effective budgeting.

The project is targeting new connections to about 4,500 households, 20 schools and 20 medical facilities in the three provinces by its completion date of 2014. The goal is to increase the percentage of the population with access to electricity from 3% to 9% in Northern Province; 4% to 8% in West New Britain; and 1% to 5% in Autonomous Region of Bougainville.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region. In 2011, ADB approvals including co-financing totaled $21.7 billion.

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