ADB to Boost Port Moresby Electricity Supply

PNG Power Ltd’s Acting Chief Executive Officer John Tangit, Managing Director for Independent Public Business Corporation Wasantha Kumarasiri and ADB’s PNG Country Director Marcelo Minc celebrate the signing of a project agreement for the Port Moresby Power Grid Development Project.

MANILA, PHILIPPINES – The Asian Development Bank (ADB) and Government of Papua New Guinea (PNG) today signed a project agreement to implement the Port Moresby Power Grid Development Project which will boost access to reliable electricity in PNG’s largest urban center, Port Moresby.

By extending existing electricity grids in urban and peri-urban areas, the project aims to boost electricity access rate in Port Moresby to 74%. The project is targeting grid extension to an estimated 3,000 low-income households.

“This project will connect currently unserved households to reliable, good quality electricity for the first time,” said Xianbin Yao, Director General of ADB’s Pacific Department. “Improved power supply in the target areas will enhance quality of life and encourage low-income families to engage in small-scale income generation activities.”

The project will also help maximize and improve the use of hydropower by upgrading and rehabilitating two hydropower plants currently generating electricity for Port Moresby. This will also positively impact on the PNG economy as it will reduce fossil fuel consumption, improve the reliability of and access to the Port Moresby power grid. Ultimately, the project will assist Port Moresby power grid operator PNG Power limited (PPL) in expanding renewable energy generation, and significantly improve the quality of electricity supply.

The project agreement, signed today for ADB by its PNG Country Director, Marcelo Minc, follows the signing of two loan agreements on 2 May 2013 comprising $15 million from the Asian Development Fund and $51.7 million from ADB’s ordinary capital resources. In addition to ADB’s $66.7 million contribution, the Government of Papua New Guinea is contributing $16.3 million to the total cost of the project, which will be implemented over 4 years.

Since joining ADB in 1971, PNG has received 75 loans worth $1.5 billion, as well as one Asian Development Fund (ADF) grant worth $15 million, and 148 Technical Assistance (TA) projects worth $62.8 million.

At present, 19 sovereign loans ($661.7 million), two private sector projects ($58 million), one ADF grant ($15 million), and 11 TA projects ($9.6 million) are active. In addition, PNG’s active portfolio includes $78.7 million in co-financing from other development partners.