Samoa: Power Sector Expansion Project

Energy / Energy sector development and institutional reform

Reliable power supply is essential for enhancing the quality of life of all Samoans. Good performance of the power sector and reliable electricity services are vital for promoting private sector investments to diversify the economy and achieve sustainable economic growth. The performance of the power sector is increasingly becoming a hindrance to economic growth. High system losses and voltage drops have resulted in poor reliability and quality of electricity supply. As a consequence, consumers are resorting to more expensive self-generation.

With peak demand growing at about 3% annually in the medium term, EPC's challenge is to improve its operational efficiency and financial performance while ensuring sufficient generation and transmission capacity is available to provide a reliable and high quality electricity supply.

EPC's investment plan 2008-2015 is driven by (i) the need to improve EPC's collection performance, (ii) the need to remove transmission bottlenecks to improve reliability and quality of supply, and (iii) capacity requirements to meet growing peak demands. In the longer term, the objective is to reduce Samoa's reliance on imported fuels by promoting clean, indigenous, and renewable energy resources.

Although Samoa's debt situation has significantly improved, the economy remains import-dependent and vulnerable to climatic and global price shocks. The Asian Development Fund (ADF) grant to the Government will ease the macroeconomic impact of the large financing requirements in the power sector.

The financial performance of EPC improves.

Operational efficiency of EPC improves

EPC's investment plan meets demand requirements.

Effective regulation of the power sector is established.

Energy demand-side management

Development of clean energy.

EPC's investment plan meets demand requirements

1) Procedures reviewed in August 2008 and revised procedures implemented. Fuel audits at both Upolu and Savaii generation stations introduced 1 May 2008 and now routinely conducted monthly. Results reported monthly to the Board. EPC calculates Energy Charge and submits it to the Regulator for approval before it is applied for tariff to customers. Energy Charge is adjusted every month and Debt and Usage Charges are revised and adjusted annually.

As at 30 June 2013, Account Receivables was 0.89 months of sales; as at 30 June 2014, 1.44 months; as at 30 June 2015, 1.22 months; as at 30 June 2016 1.51 months; and as at 30 June 2017, 3.09 months.

As at 30 Dec 2014, Govt share of EPC's accounts receivables was 14.56%.

As of 31 December 2012, 80%; as at 31 October 2016, 90% or 33,000 prepayment meters installed of total 36,000 electricity customers.

As of 30 June 2018, there are 40,088 customers - 37,150 are using prepayment meters and 2,938 are using readable meters.

As at 30 June 2013, self-financing ratio was 11.6%, as at 30 June 2014, 7.5%; as at 30 June 2015, 17.7%; as at 30 June 2016, 156.4%; and as at 30 June 2017, 43.8%.

As at 30 June 2013, debt-service ratio was 2.25; as at 30 June 2014, 1.33; as at 30 June 2015, 1.21; as at 30 June 2016, 1.51; and as at 30 June 2017, 1.58.

2) Baseline figures of Total System losses established on a 12-month moving average at Sep 2008 are: Upolu: 15.7%; Savaii: 18.2%; EPC: 15.9%

Updated 12 month moving average of total system losses now reported monthly to the Board. End of Dec 2008 are: Upolu: 171%; Savaii 18.2%; EPC: 17.2%

Technical loss is established to be 13.5% from study by a Japanese volunteer and PMU in 4th Qtr 2008. Technical loss at 30 June 2015 and 31 October 2016 7%.

Not possible to calculate non-technical losses - can only be calculated as "total system loss less technical loss."

As at end of financial year 30 Jun 2015 the non-technical losses is 4% and as at 30 Jun 2016, 3%.

3) EPC's investment plan meets estimated demand and is regularly updated to address needs.

4) The Electricity Act 2010 was passed into law in 2010.

A review of EPC Act commenced in September 2015 but was put on hold, pending a decision as to whether EPC is to be registered under the Companies Act. The review resumed in May 2016 and EPC received OAG's report in June 2017. EPC will seek Cabinet's advice before they can start the process to register as Company, after which the EPC Act can be finalized and submitted for Cabinet and Parliament consideration.

The Office of the Regulator of Telecommunication Sector, which was established in 2006, was also appointed as the Power Sector Regulator in 2010.

5) Public awareness activities by EPC are ongoing. EPC works with MNRE on demand side management. Related project to conserve electricity is installation of energy efficient street lights to replace old high consumption lines.

6) No projects are financed by the CEF under the PSEP.

MOF have not pursued implementation of the CDM.

Baseline was determined before Cyclone Evan hit Samoa in December 2012 which damaged Samasoni and Fale o le fee hydros and the main water intake and headrace at Alaoa hydro which reduced energy generation from Alaoa hydro.

As of 30 June 2015, electricity produced by clean energy is 34 GWh and as at 30 June 2016, it was 37 GWh.

The equipment, materials, and works financed by the proceeds of the ADB and JBIC loans will be procured in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). ADB's standard bid documents will be used for procuring ADB and JBIC financed goods and services. The requirements of any environmental monitoring and management plans will be reflected in all civil works bidding and contract documents.

International competitive bidding will apply to core subprojects. Procurement comprise a plant design, supply and install contract for Component A, and a supply and install contract for Component B.