SOLOMON Power and the Australian Infrastructure Financing Facility for the Pacific [AIFFP] have signed a multi-million dollar combined grant and loan financing agreement for the Tina River Hydropower Project on Guadalcanal.
The project is expected to create more than 200 jobs during its construction phase before the hydropower facility is completed in 2024.
Prime Minister Manasseh Sogavare, the Australian High Commissioner, Lachlan Strahan and the Chairman of Solomon Power, David K.C. Quan, MBE, the Chief Executive Officer of Solomon Power, Donald Kiriau, were at the signing ceremony at the Heritage Park Hotel in Honiara, Wednesday.
Funding from the USD22.7 million (SBD180 million) grant and loan financing agreement will be used to build the 22km transmission system for the Tina River Hydropower Project, a joint statement issued after the signing, said.
“The transmission system is the critical piece of infrastructure needed to enable the hydropower facility to supply power to Honiara. It will deliver 70–80 gigawatt hours of renewable energy per annum – enough electricity to meet around 68 per cent of Honiara’s needs,” the statement said.
“The resulting reduction in Honiara’s reliance on diesel generation will see Solomon Islands meet all of its greenhouse gas emissions targets under the Paris Agreement.
In his remarks, Prime Minister Sogavare said:
“The fact that we witness the signing today, despite the delays brought about by the COVID-19 pandemic is testament to the genuineness, durability and maturity of our relations which ensures we achieve win-win outcomes in our bilateral relations as we continue to strengthen it.”
“More affordable and reliable electricity for Solomon Islands will alleviate pressure on household incomes and provide opportunities for businesses,” he added.
According to the statement, the Tina River Hydropower Project is Australia’s largest ever climate finance investment in the Pacific.
“The AIFFP financing package brings Australia’s investment in the Project to more than SBD360 million since 2009. The package consists of a concessional loan of SBD84.8 million and a grant of up to SBD96.8 million.
“The agreement brings with it a partnership between Solomon Power and the AIFFP that will see reliable, sustainable renewable energy delivered to the people of Honiara for many years to come”, Australian High Commissioner to Solomon Islands, Dr Lachlan Strahan, told the gathering.
Solomon Power’s Chairman of the Board of Directors, David K.C.Quan thanked the Solomon Islands and Australian governments for their support and cooperation.
“I wish to thank the Solomon Islands Government for working together with the Australian Government in maintaining the long-standing partnership to successfully implement the country’s largest renewable energy project. We are honoured by the trust and confidence AIFFP has in SIEA and we will strive to ensure the transmission system is completed on schedule and on budget.”
The AIFFP financing agreement is a milestone for Solomon Power, the statement said.
“The transmission system is expected to cost SBD219.1 million and Solomon Power will invest SBD37.6 million of its own funds in the project. Solomon Power will employ more than 200 people to make sure the transmission system is constructed before the hydropower facility is completed in 2024, the statement said.
By ALFRED SASAKO
Newsroom, Honiara
