A group of investment firms led by the Asian Development Bank (ADB) has partnered with the government of the Solomon Islands to finance new solar PV power plants, increase rooftop solar PV installations and support the islands’ power sector reforms.
The initiative is funded by a US$10 million concessional loan and a US$5 million grant from the Asian Development Fund, which provides grants to the ADB’s poorest and most vulnerable developing member countries.
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The Saudi Fund for Development (SFD) and the state-owned enterprise Solomon Power will each provide US$10 million. This marks the first joint project financing by the ADB and the SFD. The government of the Solomon Islands is also contributing US$7 million in exempted duties and taxes.
The Solomon Islands Renewable Energy Development Project initiative will help the island, located north-east of Australia, transition to renewable energy by facilitating clean energy generation and battery storage system installation. It will also support power sector reforms and promote private sector participation in renewable energy generation.
Specifically, the funding will help finance two new solar PV power plants in Guadalcanal and Malaita, and a new utility-scale grid-connected energy storage system in Honiara. The sizes of each have not been disclosed.
The funding will also support Solomon Islands’ power sector reforms, including identifying and preparing at least one private sector renewable energy project. A pilot business model for rooftop solar PV systems will also be trialled at two schools in the country.
Shane Rosenthal, ADB’s Pacific liaison and coordination office regional director, believes that upscaling renewable energy generation in the Solomon Islands could help unlock economic growth and prosperity. Currently, renewable energy only makes up 2% of the country’s grid.
“Poor access to clean and sustainable electricity and high electricity prices limit Solomon Islands’ opportunities for economic growth and prosperity. This project will reduce dependency on expensive fossil fuel imports and constitute an important milestone for Solomon Islands on its transition to renewable energy,” Rosenthal said.
“It will install additional solar PV capacity in the country and deliver the largest grid-connected battery storage system in the Pacific, which is a crucial first step in expanding grid-connected renewable energy through private sector investment.”
The ADB to support Indian rooftop solar PV
Earlier this year (18 July), PV Tech reported that the ADB was helping scale rooftop solar PV in India via US$240.5 million in loans.
Being offered to the State Bank of India (SBI) and the National Bank for Agriculture and Rural Development (NABARD), the financing will support tranches two and three of the Multitranche Financing Facility (MFF) solar rooftop investment programme, which was approved by the ADB in 2016.
This programme is a US$505 million multi-tranche financing facility, consisting of US$500 million financial intermediation loans and US$5 million capacity development technical assistance. ADB said the tranche two loan was to be provided to the SBI, while the tranche three loan was to be provided to NABARD.
