Page 15 - IB March 2021

Energy Energy

once offered by EFL to buy power from the timber processing ronmental impact, including risks and benefit sharing;
company Tropic Woods Ltd, they figure the Qaliwana Hydro people likely to be involved, and other procedures.
could earn FJ$51.32m (US$25.40m) annually. Writing in EFL’s 2019 annual report which declared an after-
“These numbers are very conservative, but they prove the tax profit of FJ$63.7m (US$31.15m), CEO Patel said an Italian
point that the proposed hydro plant at Qaliwana is feasible,” consultancy firm, Studio Pietrangeli conducted a pre-feasibil-
said Ratu Semi Leiene, a landowner of Qaliwana. ity study site visit of the proposed dam and weir sites in late
The regulated domestic tariff set by the Commerce Com- March to early April 2019.
mission is currently 34.01 cents/units. The consultant was hired by the EIB, said Patel.
Our questions emailed to Clyde & Co’s headquarters in Lon- A feasibility study followed, and a report should have been
don have yet to be answered. Documents sighted by Islands ready by now.
Business however revealed the landowners hope to approach Before its website was taken down this month, Studio
Tokyo Electric Company and the European Investment Bank Pietrangeli said the proposed Qaliwana Hydropower project
(EIB) to finance the project with the assistance of Clyde & Co. together with the upgrade of the existing Nadarivatu hydro
In their brief response to our emailed questions, the media scheme was its first project in Oceania.
division of the EIB in Luxembourg said the Bank is managing It states Qaliwana will have a power capacity of 18 MW, fea-
funds from the Investment Facility for the Pacific (IFP) “for turing an arch gravity dam of 63 metres in height, penstocks
the purpose of conducting a technical and economic feasibil- and an outdoor powerhouse. “This plant will also receive
ity study for hydropower development on the Qaliwana and flows from the Upper Wailoa catchment through weirs and
Upper Wailoa rivers. several tunnels.”
“The objective is to assist the Government of Fiji (GoF) and The tunnels will run for about 13.5km.
Energy Fiji Limited (EFL) to determine the best way to meet Work on the Nadarivatu Hydro, Studio Pietrangeli adds, will
their energy sector objectives and in particular their strategic include the installation of its third turbine that will raise the
renewable energy targets. total power capacity of the plant to 60 MW.
“The studies are ongoing, and no decisions about individual Fiji has said it is working towards generating 100% of its en-
potential projects nor structure or financing modalities have ergy through renewable sources by 2036. Infrastructure Min-
been taken yet, nor has any party (including EFL) officially ister Jone Usamate told the International Renewable Energy
requested financing from the EIB. Agency earlier this year that this ambitious target will require
“In order for the EIB to consider participation in any financ- financial support and expertise, as costs will be high.
ing, the project must fulfill our Environmental, Climate and Half of Fiji’s power needs are supplied through hydropower.
Social Guidelines set out in the EIB’s objectives for invest- Some 45% comes from fossil fuel generation and the remain-
ments in hydropower projects, and this fulfillment would be ing 5% from biomass and wind. EFL needs to generate 267
assessed during project appraisal. megawatts (MW) of power daily to service the 90% of Fijians
“The EFL is fully informed of EIB’s guidelines on good prac- connected to its grid. EFL recently signed a US$15 million
tices for meaningful stakeholder engagement.” solar project with the International Finance Corporation (part
EIB’s media division directed the magazine’s attention to of the World Bank group). It will see a private sector partner
their 60-pages manual titled ‘Guidance Note on Stakeholder deliver at least 15 MW to the national grid.
Engagement in EIB Operations’. IFC will also assist EFL in exploring potential renewable
Accessed on the bank’s website, the document has a energy sources in Vanua Levu.
separate chapter on ‘Special Requirements for Engaging with Negotiations are underway between EFL and a Japanese in-
Indigenous Peoples.’ vestor for the divestment of the 44 percent stake in EFL. This
It states that the requirements are “to ensure that any com- would also see the Fiji National Provident Fund (FNPF) sell its
munities of indigenous peoples affected by a project are fully 20% stake. While details have yet to be announced, Islands
informed about the project and its potential impacts, mean- Business has been reliably informed that the divestment by
ingfully consulted about the project, and given the chance to FNPF was a condition in the initial purchase agreement when
deliberate on whether they agree with the project.” the pension fund bought the shares from the Fiji Government
Free, Prior and Informed Consent is a key part of the EIB’s in August 2019.
commitment to human rights, and the manual stressed that “It was always understood that FNPF will hold on to the
any “promoter who receives EIB finance for a project impact- shares until the Government finds a strategic partner to buy
ing indigenous peoples” must abide by the FPIC principles: the 44 percent, in which case FNPF will sell its holding, as per
• No coercion, intimidation or manipulation. the sale agreement” Islands Business was told.
• That consent has been sought well in advance of activi- Whether the FNPF will recover the $206.1 million (US$100
ties, and sufficient time is made for indigenous consulta- million) it forked out for the 20 percent stake in EFL stakes –
tion and consensus processes. as disclosed in the 2019 EFL Annual Report – is not known, but
• Information is provided covering the nature, size, pace, Islands Business has been told that talks on the divestment
reversibility and scope of any proposed project or activ- have concluded and that a statement will be issued soon.
ity; its purpose; the time involved; location of affected
areas; the likely economic, social, cultural and envi- publisher@islandsbusiness.com

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