Electricity consumers in Tonga can expect better value-for-money, cleaner and more resilient and reliable electricity services in the next five years. These are the expected outcomes from the Electricity Concession Contract (ECC) that was signed at Nuku’alofa by the Tonga Government, the Tonga Power Ltd (TPL) and the Tonga Electricity Commission (TEC) on 12th January 2021. The Hon. Minister for Finance and National Planning, Tevita Lavemaau signed on behalf of the Government and Dr ‘Aisake Eke, chairperson of the joint Utilities Board signed on behalf of the TPL while Rev. ‘Alifeleti ‘Atiola, Chairperson of the TEC signed on behalf of TEC.
The 3rd ECC records the agreed terms and conditions upon which the TPL will generate, distribute and supply electricity to consumers in the Kingdom and other regulatory arrangements entered into by TPL and TEC. The ECC provides the technical and financial parameters by which TPL must operate to meet the expectations of its investors, customers and more importantly government’s vision for the energy sector. It therefore provides a stable and certain business environment by which TPL can operate with confidence to meet its expected returns and outcomes. At the same time, the ECC provides TEC with clear benchmarks and milestones for its oversight role on the electricity sector.
“This ECC ensures a fair arrangement for TPL, TEC, the consumers and the government”, say Kilisimasi Ma’asi, the Acting CEO of TEC. On the one hand, it supports and encourages quality and value-for-money services for customers by way of reliable and sustainable electricity services. On the other, it acknowledges and rewards TPL for improvements in efficiency of its operations and service delivery. And on the other, it recognizes the increasing contribution of renewable energy to Tonga’s electricity mix and welcomes independent power producers to invest in Tonga and to achieve government’s target of 70% renewable energy by 2030.”
The Nuku’alofa-based Pacific Centre for Renewable Energy and Energy Efficiency (PCREEE) of the Pacific Community (SPC) provided technical advice to TEC in the review of the second ECC and training of its staff. “SPC is pleased with its collaboration with TEC. No doubt, the signed ECC will contribute to more reliable electricity services to fight the COVID pandemic plus a more resilient electricity infrastructure to withstand natural disasters”, said Solomone Fifita of SPC.
The First Electricity Concession Contract came into force on 25th July 2008. The Second Electricity Concession Contract came into force on 1st September 2015. The Third Electricity Concession Contract which replaces the Second ECC came into force on 1st January 2021.
About TEC and the PCREEE
The Electricity Commission was established through the Electricity Act of 2007 with functions which include the licensing of electricians and establishing standards for electrical safety. The Commission is also tasked to enforce actions under this Act or any regulations made under the Act.
The PCREEE is a regional vehicle to accelerate the uptake of renewable energy and energy efficient technologies in the Pacific Islands and is co-hosted by the Pacific Community (SPC) and the Tonga Government at Nuku’alofa, Tonga. It is a collaboration between SPC, UNIDO, SIDS Dock, the Government of Tonga and the Governments of Austria and Norway.