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Description |
The proposed TA will (i) develop a comprehensive reform program, including a regulatory framework, that would enable private sector participation and enhance the efficiency in the sector; (ii) develop a program to reform the Electric Power Corporation's (EPC) internal business and management procedures to enhance governance and cost efficiency; and (iii) prepare an investment road map to diversify the country's energy resources, meet future load growth, and reduce the burden of diesel imports.
Successful implementation of this TA is envisaged to lead to efficient and reliable electricity services to end consumers and to an ensuing loan that would support the power system expansion program. The power system expansion program will help the country and EPC, and ultimately end consumers, to reduce exposure to global fuel prices by promoting indigenous and renewable energy resources.
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Project Rationale and Linkage to Country/Regional Strategy |
Developing indigenous and renewable energy resources to reduce the economy s risk exposure to foreign exchange fluctuations and fuel price increases is a high development priority for the country and articulated in the Government s Statement of the Development of Samoa (SDS) 2005 2007. Imports of petroleum products account for 15% of Samoa s total import expenditure in FY2004/05.
EPC s Corporate Plan identifies diversification through the development of indigenous and renewable energy resources as a key priority to reduce current reliance on diesel as the primary source of energy. Fuel is by far the single largest expense item, representing 74% of total generation costs and 51% of EPC s overall costs. This leaves EPC, and ultimately electricity consumers, highly exposed to changes in world market oil prices and foreign exchange rates.
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