Palau : Palau Public Utilities Corporation Reform Program (Subprogram 1)

Sovereign Project | 54151-001

The proposed Palau Public Utilities Corporation Reform program aims to strengthen the corporate governance and financial management of Palau's water and electricity utility company, Palau Public Utilities Corporation (PPUC), and improve electricity market by supporting tariff reforms. The programmatic approach is proposed through policy-based loans to finance two subprograms during 20202022. The programmatic approach will (i) confirm sequencing of reforms and investment projects in coordination with the IMF and other partners, (ii) ensure long-term continued engagement as the reforms are multi-fold and require multiple years to implement and yield results, (iii) facilitate provision of advisory and analytical assistance to support implementation of reforms, and (v) adjust the size of respective subprograms with the pace of implementation.

Project Details

Project Name
Palau Public Utilities Corporation Reform Program (Subprogram 1)
Project Number
54151-001
Country / Economy
  • Palau
Project Status
Active
Project Type / Modality of Assistance
  • Loan
  • Technical Assistance
Source of Funding / Amount
Loan 4030-PAL: Palau Public Utilities Corporation Reform Program (Subprogram 1)
Source Amount
Concessional ordinary capital resources lending US$ 5.00 million
TA 6649-PAL: Strengthening Institutional Capacity of Palau Public Utilities Corporation
Source Amount
Technical Assistance Special Fund US$ 400,000.00
Operational Priorities
  • OP1: Addressing remaining poverty and reducing inequalities
  • OP2: Accelerating progress in gender equality
  • OP6: Strengthening governance and institutional capacity
Sector / Subsector
  • Energy / Energy sector development and institutional reform

Gender
Effective gender mainstreaming
Description
The proposed Palau Public Utilities Corporation Reform program aims to strengthen the corporate governance and financial management of Palau's water and electricity utility company, Palau Public Utilities Corporation (PPUC), and improve electricity market by supporting tariff reforms. The programmatic approach is proposed through policy-based loans to finance two subprograms during 20202022. The programmatic approach will (i) confirm sequencing of reforms and investment projects in coordination with the IMF and other partners, (ii) ensure long-term continued engagement as the reforms are multi-fold and require multiple years to implement and yield results, (iii) facilitate provision of advisory and analytical assistance to support implementation of reforms, and (v) adjust the size of respective subprograms with the pace of implementation. Transaction technical assistance (TA) will facilitate program implementation, including providing technical advice to and building the capacity of the Ministry of Finance (MoF) and PPUC.
Project Rationale and Linkage to Country/Regional Strategy

The Government of Palau recognizes the strong link between economic growth and the urgency of energy reforms to sustain supply by modernizing its infrastructure. Given the importance of energy sector in the economy, its improved governance and performance can have far-reaching effects in all segments of the society, impacting the day-to-day lives of citizens, and other parts of the business sector. With adverse impact of Covid-19, the sector reforms including good governance financial sustainability and development of contingency plan are critical to ensure its positive contribution to economic efficiency, competitiveness and energy security. PPUC reform is a good practice example and could be an important driver in the reform of the overall SOE sector in Palau.

The program will complement and underpin ADB's proposed project loans during 20202022 for (i) power transmission enhancement, (ii) disaster resilient clean energy financing and (iii) developing PPP transaction for renewable energy. This lending program and ADB's overall energy sector strategy are also designed to support PPUC's investment plan and the government's target for 45% renewable generation by 2025.

Impact

Financial sustainability and sector performance achieved

Project Outcome

Description of Outcome

Reliability, sustainability, and affordability of the energy system improved

Progress Toward Outcome

Implementation Progress

Description of Project Outputs

Tariffs reforms managed

PPUC financial management and sustainability

PPUC corporate governance and transparency

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

Contact

Responsible ADB Officer
Abbasov, Rafayil
Responsible ADB Department
Sectors Group
Responsible ADB Division
Energy Sector Office (SG-ENE)
Executing Agencies
Ministry of Finance

Timetable

Concept Clearance
13 May 2020
Fact Finding
20 Jul 2020 to 07 Aug 2020
MRM
02 Oct 2020
Approval
07 Dec 2020
Last Review Mission
-
Last PDS Update
07 Dec 2020

Funding

Loan 4030-PAL

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 Dec 2020 10 Dec 2020 03 May 2021 31 Mar 2021 30 Sep 2021 07 May 2021
Financing Plan
  Total (Amount in US$ million)
Project Cost 5.00
ADB 5.00
Counterpart 0.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 06 Jun 2024 5.00 0.00 100%
Cumulative Disbursements 06 Jun 2024 5.00 0.00 100%

TA 6649-PAL

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 Dec 2020 29 Dec 2020 29 Dec 2020 30 Jun 2022 30 Jun 2024 -
Financing Plan/TA Utilization
ADB Cofinancing Counterpart Total
Gov Beneficiaries Project Sponsor Others
400,000.00 0.00 0.00 0.00 0.00 0.00 400,000.00
Cumulative Disbursements
Date Amount
06 Jun 2024 214,836.79

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.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.


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

Title Document Type Document Date
Palau: Palau Public Utilities Corporation Reform Program (Subprograms 1 and 2) Validations of Project Completion Reports Feb 2024

Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
Coordination Expert Individual - Consulting Closed
Evaluation Specialist Individual - Consulting Closed
Tariff Financial Expert Individual - Consulting Closed
Coordination Expert Individual - Consulting Closed
Municipal water Supply and Sewerage Specialist Individual - Consulting Closed
High-Technology Expert (Energy, Green Hydrogen) Individual - Consulting Closed
Financial Management and Governance Expert Individual - Consulting Closed
Water and Sanitation Expert Individual - Consulting Closed
Financial and Economic Expert Individual - Consulting Closed
Tariffs and Regulation Expert Individual - Consulting Closed
Gender and Social Development Expert Individual - Consulting Closed

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan

None currently available.