Marshall Islands: Energy Security Project (additional financing)

Sovereign Project | 49450-026

The grant to the Republic of the Marshall Islands for the additional financing of the Energy Security Project will enhance the objective of increased energy security. It will be financed under the facility and supports the implementation of the management action plan to improve the performance of the MEC. Further, it will increase the resilience of MEC's energy business and support the initial steps of the national roadmap to reduce electricity sector emissions by 65% by 2030.

Project Name Energy Security Project (additional financing)
Project Number 49450-026
Country / Economy Marshall Islands
Project Status Active
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant 0817-RMI: Energy Security Project (additional financing)
Asian Development Fund US$ 7.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Energy / Energy utility services

Gender Equity and Mainstreaming Some gender elements
Description The grant to the Republic of the Marshall Islands for the additional financing of the Energy Security Project will enhance the objective of increased energy security. It will be financed under the facility and supports the implementation of the management action plan to improve the performance of the MEC. Further, it will increase the resilience of MEC's energy business and support the initial steps of the national roadmap to reduce electricity sector emissions by 65% by 2030.
Project Rationale and Linkage to Country/Regional Strategy

The Marshall Islands depends heavily on external assistance, with an average 60% of gross domestic product being provided through annual grants. Most grants are provided through the Compact of Free Association (COFA), with the United States and have a built-in annual step down, which may be extended beyond the expected closing of 2023. Unemployment is high and human development indicators are generally low; income distribution is quite uneven and there is considerable poverty in the outer atolls. Economic growth over fiscal year (FY) 2015 to FY2020 was supported by strong fisheries output and the resumption of infrastructure projects connected with the COFA. The Marshall Islands has been impacted by the coronavirus disease (COVID-19) pandemic, particularly in the fisheries and transport.

Impact

The overall project is aligned with the following impacts: (i) energy security for the Marshall Islands improved; and (ii) safety, environmental, and disaster risks associated with handling and storage of refined petroleum products and electricity reduced.

Project Outcome
Description of Outcome

Safe, reliable operation of the Majuro fuel tank farm sustained and delivery of electricity in Majuro improved.

Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Majuro tank farm rehabilitated.

Majuro tank farm O&M program instituted.

MEC corporate capacity enhanced.

Disaster resilience of the energy sector improved.

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Responsible ADB Officer George, Len V.
Responsible ADB Department Pacific Department
Responsible ADB Division PAEN
Executing Agencies
Ministry of Finance, Banking and Postal Services
Timetable
Concept Clearance -
Fact Finding 26 Jul 2020 to 26 Aug 2020
MRM 08 Nov 2021
Approval 14 Dec 2021
Last Review Mission -
Last PDS Update 14 Jan 2022

Grant 0817-RMI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
14 Dec 2021 17 Dec 2021 07 Feb 2022 30 Jun 2026 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 7.70 Cumulative Contract Awards
ADB 7.00 27 Sep 2022 0.39 0.00 6%
Counterpart 0.70 Cumulative Disbursements
Cofinancing 0.00 27 Sep 2022 0.00 0.00 0%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory Satisfactory Unsatisfactory Unsatisfactory Unsatisfactory

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

None currently available.


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Tenders

Tender Title Type Status Posting Date Deadline
Supplemental Management Operations for Marshalls Energy Company Firm - Consulting Closed 21 Jan 2022 19 Feb 2022

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
PIC - Contract Administration and Claims Consultant (individual) Grant 0817 22 Aug 2022 Turquoise Projects Pty Ltd (Jeremy Farrington) | 196-202 Wyndham Street, Alexandria, New South Wales, Australia Ministry of Finance, Banking and Postal Services 389,320.00

Procurement Plan