OTH: Papua New Guinea: Town Electrification Investment Program

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OTH: Papua New Guinea: Town Electrification Investment Program

Town Electrification Investment Program (RRP PNG 41504) LIST OF POTENTIAL RENEWABLE ENERGY SUBPROJECTS FOR SUBSEQUENT TRANCHES AND SELECTION CRITERIA A. List of Potential Hydropower Plants 1. The 10 year Power Development Plan1 and PNG Power Ltd have identified the following proposed subprojects for potential inclusion in subsequent tranches: Table 1: Potential Projects Item Hydropower Plant Location Estimated Capacity 1. Kiunga Hydropower Western Province <2MW 2. Murua River Kerema, Gulf Province <1MW 3. Daundo River Hydropower Vanimo, Sanduan Province <2MW 4. Lauis Hydropower Lorengau, Manus Province <2MW 5. Kavieng Hydropower Kavieng, New Ireland Province <2MW 6. Gazelle Renewable Energy East New Britain Province 5-10MW 7. Lake Hargy #2 West New Britain <3 MW 8. Ru Creek #2 West New Britain <3 MW 9. Arawa Hydropower Arawa, Autonomous Region of 2-5MW Bougainville Note: The above sites are indicative only, as technical and financial feasibility needs to be established on a site by site basis during project assessment. Additional sites of varying generation capacity may also be identified, including in Provinces supporting the Ramu and Port Moresby grids. B. Selection Criteria 2. To assist in identifying appropriate sites for future tranches, a set of selection criteria has been proposed. A candidate project should meet the following conditions: (i) Owned or majority owned by PNG Power Ltd. (ii) Meet the 12% economic internal rate of return for the proposed investment. (iii) Have a financial internal rate of return (FIRR) exceeding the Weighted Average Cost of Capital (WACC). (iv) Be included in the 10 year Power Development Plan as a proposed site. (v) Have the support of the local population and the district and provincial administrations. (vi) Be demonstrated to be the least cost generation alternative. (vii) Consist of clean energy generation, including but not limited to hydropower, geothermal, wind, biomass and solar. (viii) Be located on Government land, or have an agreement with the effected community that allows use of, or acquisition of, land after going through the necessary procedures and payment of required compensation. 1 PNG Power Ltd, National and Provincial Ten Year Power Development Plan, 2009-2018, November 2009, Port Moresby. .

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