Papua New Guinea

Workshop on Sharing the Benefits of New Hydro Power in PNG - Environmental, Social and Financing Aspects of Medium and Large Hydropower

The Government of PNG (GoPNG) with support from JICA, WB and UNDP held a workshop from the 7-8 Sept 2010 in Port Moresby on Sharing the Benefits of New Hydro Power in PNG - Environmental, Social and Financing Aspects of Medium and Large Hydropower. The workshop was attended by key stakeholders in PNG including representatives from government departments, state owned utilities and enterprises, NGOs, and the private sector including financial institutions as well as development partners such as IFC, ADB, EIB, JICA, and AusAID. In addition, resource people from the Asia-Pacific region including Nepal and Lao People's Democratic Republic made presentations on international experiences in hydropower development.

The GoPNG presented its vision for the energy sector, and highlighted that until recently, the focus was on oil and gas. However, since oil development has matured and gas utilization has started, government is now considering other energy sectors including electricity. According to the PNG Development Strategic Plan 2010-2030 the goal for 'energy development' is that 'All households should have access to reliable and affordable energy supply, and sufficient power is generated and distributed to meet future energy requirements and demand'. On the policy front, a major development is the Electricity Industry Policy (EIP). This policy is expected to be endorsed by the National Executive Council (NEC) soon and will see changes in the structure of the electricity industry including technical regulation to be transferred to the Independent Consumer and Competition Commission (ICCC). Competition will be introduced in certain segments of the electricity market.

UNDP provided support for the workshop as part of the GoPNG and UNDP Strengthening Aid Coordination and Management Capacities Project, which aims to strengthen government capacities to lead the process of localization and implementation of the Paris Declaration on Aid Effectiveness, as an entry point to enhance the effectiveness and efficiency of the aid coordination and management functions within the GoPNG. In this context the Government of PNG requested UNDP to speak on the importance of aid effectiveness including in relation to the energy sector. In her statement, Mrs. Carol Flore-Smereczniak, UNDP Deputy Representative, reminded participants that aid effectiveness is about ensuring that the benefits of Overseas Development Assistance (ODA) are maximized though government ownership, donor alignment and harmonization and joint management for better results and mutual accountability. She mentioned that the GoPNG has taken the important step of localizing the Paris Declaration through the PNG Commitment on Aid Effectiveness, a document which signifies the government's commitment to strengthening the development aid partnership. UNDP's three core messages were:

1. With regards to aid effectiveness, there needs to be high-level, whole of government leadership at the national level. It is encouraging that the GoPNG has taken a lead role in the coordination of the energy sector. Development partners would like to see the government take a stronger lead role in coordinating overseas development assistance in other areas as well, and indicating to development partners where resources and support should be directed for better development results.
2. Access to affordable and sustainable energy services including from hydro power is a fundamental driver to reducing poverty and empowering ordinary citizens in PNG to improve their standard of living, and achieve the Millennium Development Goals (MDGs).
3. And finally, in relation to the theme of this workshop, "the Sharing of Benefits of new Hydro Power in PNG", development in PNG needs to occur with equity. The MDGs can be achieved by using the benefits of PNG's natural resources to address development inequalities - and not to widen them.