Cover photo: power infrastructure in the Marham Valley in Morobe Province, Papua New Guinea
Papua New Guinea has one of the lowest electrification rates in the world. Statistics from the World Bank’s Sustainable Energy for All (SE4ALL) database put the electrification rate of PNG at 22.9% – a number used by SE4ALL Global Tracking Framework led jointly by the World Bank, International Energy Agency, and the Energy Sector Management Assistance Program.
However, the electrification rate in PNG is often reported to be even lower and claimed to be as low as 13%. Depending on which connections data set is used, and due to uncertainties in the current population, it may be less than 10% of the population that has access to electricity. It is recognised worldwide that an increase in electrification rates increases education and economic development.
To remedy this situation the PNG Government has committed to an ambitious target of 70% electrification by 2030. While there has been work on connection goals in the recent Energy Policy as well as the National Electricity Rollout Plan (NEROP) there is little detail on the strategy and tactics to reach this 70% goal – both in terms of funding and delivery mechanism.
The electrification of PNG requires two key elements: generation and connections to households. In terms of generation, there needs to be sufficient electricity available to power the grid. Ideally, the sources of electricity for power generation are clean, renewable and affordable. It is important to note that the demand for power only grows in small increments, and so modular and relatively small grid-connected generation is required. For example, 30 MW of generation is enough to provide power for almost a million people (180,000 rural dwellings). In 2016, it was estimated by NEROP researchers that PPL had approximately 90,000 residential connections.
In terms of connections, this requires long distance transmission and subsequent local distribution to communities, and then connecting houses to the local distributions system. The cost of these elements of connecting a household to the grid is high. It is also important to recognise that many households are too far from main grids to be connected, requiring small off-grid or mini-grid power generation.
Household connection problems
To meet the 2030 electrification target of 70% by 2030, around 2,800 new connections have to be made per week; adding up to 1.8 million connections in total by 2030. At present, little progress being made and the connection rate is well behind the rate needed to reach the target. The total cost using the current methods to connect households would be around PGK 7.4 billion in total, amounting to PGK 617 million a year for the next 12 years.
The biggest cost component by far in electricity supply is the cost of connecting people to a sustainable and affordable supply of electricity. Based on NEROP data, at present the total average cost to PNG Power of a connection for a single household in PNG is between PGK 3,500 and PGK 4,000 per connection, which includes the costs of transmission, local distribution and physical connections of the house to the local distribution system. Customers pay a nominal connection charge and then the approved energy tariff. This means that PNG Power cannot fully recoup the high connection cost which poses a financial roadblock to substantially increasing the roll out of new connections.
This approach poses a real dilemma for PNG Power to make rural connections, for two reasons: low power utilisation and payback capacity. Many households do not require an expensive connection, all they require is a basic supply of power for lighting and phone charging. In the Highlands where most of the population lives, household electricity loads are minimal: LED lighting draws minimal power and generally there is no need for power hungry appliances like air conditioning, refrigeration, and freezers. So due to low household power utilisation in rural areas, it is not economically sensible to roll out expensive grid connections.
In addition, many people in rural areas have little cash income so can only afford minimal monthly payments. That means offering households expensive connections when they don’t need them and cannot afford to repay the installation cost makes no business sense. On top of this, many houses in PNG are of traditional construction and hard-wired 240 volt house wiring is not going to be a sensible option for safety reasons. A lower cost and more suitable power solution is required.
Embracing a new low-cost power paradigm
The capital investment required for additional generation to cover 70% of the population is a small fraction of the cost of making the household connections required to provide access. The majority of cost is in transmission, local distribution (wires and transformers, and cost of connecting dwellings). Hence, achieving the 2030 electrification target of 70% of the population requires a new low-cost power delivery connection paradigm.
The costs of connections need to be lowered dramatically to achieve electrification in a more cost-effective manner and new technologies should be embraced. These will include:
Smart meters allow energy and revenue monitoring and analysis in real-time. It manages energy consumption of individual customers and prevents theft.
Low Cost Connection Boxes bring power safely to traditional houses and make sure energy provision is low cost and safe. They feature 12 volt outlets for 12 appliances, 12 volt LED lighting, 240 volt outlet, safety switch, and USB outlet for phones.
In-stream micro hydro
Tesla powerwall battery
Solar and in-stream hydro technologies in combination with battery storage reduce cost and deployment issues for household connections.
PNG Biomass is working on solutions for this new power paradigm, solutions that address both generation and connection. The biomass energy project that PNG Biomass is developing in the Markham Valley will generate 30 MW of renewable electricity matched to the size and timing of the growth of the Ramu Grid. As household loads are generally not high loads, 30 MW is enough to power 180,000 households, or about a million people.
The Project has also developed a suite of power and connection solutions designed to lower the costs and improve the rollout of new household connections by involving local communities. Through a low-cost connection plan PNG Biomass demonstrates that new, smarter and more efficient power technologies can connect large numbers of people to an electricity grid in PNG and provide them with affordable energy. These low-cost connections include a mix of solar and in-stream hydro technologies in combination with battery storage to reduce cost and deployment issues for household connections. The plan suggests ways in which PPL can roll-out more connections at a lower cost and meet the country’s Medium Term Development Plan connectivity target rates.
PNG Biomass is currently exploring the implementation of a low-cost connection proof of concept in the Markham Valley.
 International Renewable Energy Agency (August 2013), Renewable energy opportunities and challenges in the Pacific Islands region: Papua New Guinea, Pacific Lighthouses series.
 Asian Development Bank (April 2009) Papua New Guinea: Power Sector Development Plan, Technical Assistance Consultant’s Report, Project Number: 40174, VisionRI Connexion Services Private Limited; Asian Development Bank (September 2017), Papua New Guinea: Implementation of the Electricity Industry Policy, Completion Report, Project Number: 46012-001