Energy poverty is widespread in the Pacific. It is estimated that 70 per cent of households in the region don’t have access to electricity and 85 per cent don’t have access to clean cooking energy technology. These access rates are low by both international and regional standards, being equivalent to those in sub-Saharan Africa and slightly below the average for low income countries. This is despite higher income levels in much of the Pacific. Energy poverty, or the lack of access to modern energy services, is a concern given its development impacts.
Limited access to electricity is a barrier to economic activity and the delivery of key public services, including health, education and infrastructure services. At the household level, un-electrified households have been shown to spend more on energy than do households with access to electricity. This is because un-electrified households are forced to spend money on fuels for lighting, such as kerosene, which are more expensive than the use of electricity for lighting. The situation does not appear to be improving.
There has been limited progress in widening access to electricity in rural areas of the Pacific – which is where the vast majority of un-electrified households are situated. This is particularly true in Papua New Guinea (PNG), Solomon Islands and Vanuatu, where electrification rates are lowest, being below what would be expected given per capita income levels. There are a number of reasons why access to electricity in rural areas is so low in the region. One relates to spending on rural electrification. The high upfront cost associated with rural electrification means that subsidisation is generally required (this is subsidisation for the upfront cost of establishing an electricity supply, not ongoing supply costs which can be met through user fees). But government resources that are dedicated to rural electrification in the Pacific are limited.
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