GCF funds for Nauru port


By Islands Business correspondent Nic Maclellan at the Pacific Islands Forum in Nauru

 Like other Pacific island nations, Nauru is facing significant climate challenges. Last October, the Micronesian nation received a major grant from the Green Climate Fund (GCF) to rehabilitate its port infrastructure. But the country is seeking extra resources to address growing demand for household energy and water supply – especially as the country hosts hundreds of asylum seekers and refugees, as well as the local population of 11,000 people.

The host of this week’s Pacific Island Forum leaders’ meeting, President Baron Waqa, said: “The climate change issue is not just hot globally but urgent for the Pacific. Climate change is already here – it’s not coming in the future, it’s already here. We’re working very hard – especially the smaller island states – to advocate to the world that something has to be done right away.”

Berilyn Jeremiah, Nauru’s Secretary for Commerce, Industry and Environment agrees that climate variability and natural disasters are already affecting the country.

“Nauru is susceptible to droughts which, in the past, have had significant impacts on health, food security and the economy, as it can put a strain our national budget,” she said. “Drought periods can also increase the risk of fires and for a country that is very remote, losing critical infrastructure and services such as power, water, schools and hospitals can be disastrous.”

She added: “Enhancing water security is fundamental to reducing vulnerability to climate change. Food insecurity is also a major risk for Nauru, given our dependence on imported foods and its geographical isolation. Most agricultural activity is carried out by individual households and is constrained by limited availability of suitable land and water.”

Nauru has developed a 20-year master plan for water security, but lacks the resources to implement it. The Environment Department is seeking to increase the number of reverse osmosis units, install solar water distillation systems in schools and increase capacity for rainwater collection or household collection. However in times of drought and water shortage, desalination plants are costly to run and difficult to maintain.

The presence of hundreds of asylum seekers and refugees in Nauru under Australia’s offshore processing programme places an extra burden on Nauru’s population. These problems were well understood when Australia re-established the camps in 2012 (a team from Australia’s Department of Immigration travelled to Nauru to review possible sites for the asylum seeker centres, and their ‘in-confidence’ report at the time confirmed: ‘There is an issue with water supply at the island and the manager advises that at least one additional reverse osmosis water treatment plant would be required to meet additional demand.’)

The cost of power generation in Nauru is also very high due to the heavy reliance on imported fossil fuels. Only 3 per cent of Nauru’s electricity is provided by renewable energy – a small level compared to other small island states in the region

Based on the government’s RONAdapt programme and the Nauru Energy Road Map, Berilyn Jeremiah says the government has set ambitious priorities for 2020: “We aspire to achieve 24/7 grid electric supply with minimal interruptions and to achieve 50 per cent of grid electricity supply from renewable energy sources.”

Green Climate Funding for port

Like other Pacific nations, Nauru has gained funding from the Green Climate Fund (GCF) – the global mechanism created under the UN Framework Convention for Climate Change, and a crucial source of funding for developing countries under the Paris Agreement on Climate Change.

The GCF started off with strong progress, allocating funds to a range of initiatives in the Pacific islands. But in mid-2018, things have turned sour. In July, the head of the GCF secretariat in Song-do, Korea, Australian diplomat Howard Bamsey, resigned with immediate effect. The July GCF board meeting was entangled in debate, and no projects grants were finalised by the 24 developed and developing country Board members. The GCF failed to approve almost a billion dollars in proposed projects, including a solar project for Tonga, which must wait until the next board meeting in October.

Another looming threat is the need to replenish the $10.3 billion fund, for future grants post-2020.

In 2014, US President Barack Obama, pledged US$3 billion to the fund, and actually paid a third of this before he left office. The Trump administration however has refused to commit the remaining US$2 billion, a significant hole in the GCF’s budget. The fall in the value of the British pound after the 2016 Brexit decision has also devalued the early pledges made by the UK government that are not yet disbursed.

After this week’s meeting of the Smaller Island States (SIS) in Nauru, President Waqa noted: “Anything to do with climate change and the Green Climate Fund is a concern for the Pacific. We talked a bit about that in the [SIS] meeting. Maybe the United States will pull out – that’s what this administration is doing. But we won’t concern ourselves with that. There’s enough other support for the programmes we have.”

Nauru got in ahead of the GCF’s current problems. In October 2017, at its meeting in Cairo, the GCF board approved a US$26.9 million (A$35 million) grant to Nauru. The project, to be run in co-operation with the Asian Development Bank (ADB) will give Nauru’s port a much-needed upgrade.

At present, the port infrastructure regularly leaves ships having to transfer goods manually from beyond the coral reef, and these transfers can be difficult at times of storm surges and bad weather. At the time of the 2017 decision, Nauru Minister for Finance David Adeang stated: “When completed, the port will become a major part of Nauru’s transport infrastructure enabling shipments to move in and out much more smoothly than they do now.”

When the GCF board made its decision on the port project, there was opposition from some developed countries, which saw the initiative as an economic rather than climate-specific project. Japan and France questioned whether the GCF should focus on adaptation or emissions reduction. The United Kingdom argued against approving the project but bowed to lobbying from Australia and other delegates. The UK government officially noted its reservation that the port was not value-for-money given the significant cost (however with a small population, Nauru is never going to be cost-effective if you measure per capita!).

Speaking to journalists at this week’s Forum meeting, Nauru Environment Secretary Berilyn Jeremiah still thinks that there are positive environmental elements from reducing the time to unload vessels arriving off the island.

“The port is an important development project for us,” she said. “It’ll help with reducing the prices of food and lowering our reliance on fossil fuels, because it will reduce the time for tran-shipment.”


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