The document discusses developing and sustaining integrated renewable energy power systems for rural areas in Papua New Guinea. It provides background on PNG's energy sector, which is dominated by electricity, oil, and gas. PNG Power Limited is responsible for generation and distribution but only 7% of the population has access to electricity. The presentation outlines PNG's renewable energy resources including hydro, solar, and wind. It also discusses a case study of the Wantun micro-hydro project and proposes micro-grid systems and various business models to power rural micro-grids, emphasizing private sector participation and subsidies.

1. Developing & Sustaining Hydro
Integrated Renewable Energy Power
System for Rural Areas in
Papua New Guinea
Ms Rebecca Ogann Kiage
Suapi Management Consultancy
Papua New Guinea
Mr Sammy Samun Aiau
Electrical & Communication Engineering Department
Papua New Guinea University of Technology
Papua New Guinea
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2. Outline of the Presentation:
Objective of the Paper
Background of Papua New Guinea
Papua New Guinea Energy Sector
Papua New Guinea Electricity Structure
 Policy Framework
 PNG’s Electricity Industry Structure
 PNG’s Electricity Regulatory Framework
PNG’s Renewable Energy Resources
 Hydro Energy
 Solar Energy
 Wind Energy
Rural Electrification with Renewable Energy Sources in
PNG
Case Study, Wantun Micro-hydro/Solar Project
Micro-hydro/Solar/Wind Micro-grid Power System
Business Models for Rural Micro-Grids
Conclusions
2
Recommendations

3. Objective of the Paper:

To understand Papua New Guinea’s electricity
industry structure and policy and regulatory framework.

To promote the use of Renewable Energy to achieve
sustainable development in the rural areas of Papua New
Guinea.
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4. Background of Papua New Guinea:
4

5. Background of Papua New Guinea
•
•
•
•
•
Located south of the equator in the Oceania
region.
PNG total land area is 462,800 square
kilometers.
PNG population is 7 million with (approximately 6
million people) live a traditional rural subsistence
rural lifestyle.
PNG gained independence in 1975 and is a
parliamentary democracy.
The National Government consist of three (3)
independent branches – (executive, legislature
and the judiciary).
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6. Papua New Guinea Energy Sector
•
•
•
•
•
•
•
The energy sector in Papua New Guinea mostly
depends on three main types of energy:
– Electricity
– Oil
– Gas
The energy sector accounts for 14% of the country’s GDP
(PNG‘s GDP US$ 12.937 billion with a growth rate of
8.9%).
PNG Power Limited is the sole national electricity
company responsible for generation, transmission,
distribution and retail of electricity in PNG
Oil Search (17.6% PNG Govt. shares) and Inter Oil
are the oil companies.
Both companies dominate the gas market as well.
The PNG LNG Project, scheduled for deliveries in
2014 will be a setting a major change in PNG’s
energy sector.
On the Renewable Energy sector, it remains
severely underexploited due to organizational and
technological reasons.
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7. Why RE Sector is Underexploited
•
Absence of:
– Electricity Industry Policy
– Energy Policy
– Rural Electrification Policy
•
High investment costs associated with establishing
transmission lines due to the PNG’s rugged topography.
•
Recent initiative by the Somare-Temu government in
2006 has paved the way for the development of the three
important policies:
–
–
–
–
–
•
Electricity Industry Policy (endorsed 2011)
National Energy Policy (early draft stage)
Rural Electrification Policy & Strategy (early draft stage)
Geothermal Energy Policy
Renewable Energy Policy
The delay in the formulation and implementation of these
policies has deprived the bulk of the population especially
in the rural areas of Papua New Guinea, without access
to electricity.
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8. Papua New Guinea Electricity
Situation
• PNG 90% of the population of 7 million lack
access to electricity services.
• The progress of rural electrification has lagged
over the years.
• PNG electrification rate is only 7%.
• PNG Power Limited (PPL) is sole national
electricity company responsible for generation,
transmission, distribution and retail.
• PNG does not operate on a national power grid.
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9. Papua New Guinea Electricity
Situation
• PNG has 3 main grids, supplied by major hydro
power plants.
• 19 regional centres are supplied by diesel
powered thermal generation.
• PNG’s total installed generation capacity is
580MW.
• PNG Power Limited manages approximately
300MW capacity.
• 280MW is generated by other IPP’s.
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10. PNG Power Limited Power System
10

11. PNG Energy Profile
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12. PNG Electricity Situation:
PPL’S CURRENT AND PROPOSED HYDROPOWER INSTALLATIONS IN PNG
CURRENT INSTALLED HYDROPOWER STATIONS
Name
PROPOSED HYDROPOWER DEVELOPMENTS
Installed/Available
Capacity (MW)
Capacity (MW)
Name
Port Moresby (Rauna system)
120/100
Port Moresby (Naoro Brown)
60
Ramu System (Lae-Madang-Mendi)
122/70
Port Moresby (Udava)
70
Gazelle (Rabaul) System
17/12
Ramu II system
240
Gowar
21.6
Mongi
69.7
Burum
43.5
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13. PNG Electricity Situation:
NUMBER OF PNG POWER LTD ELECTRICITY CUSTOMERS
Name of Province
Population of Province
Population with
Electricity
Population without
Electricity
Percentage of
Population without
Electricity
Central
183983
3182
180801
98
Gulf
106898
411
106487
99
Milne Bay
210412
1340
209072
99
National Capital Dist.
254158
41766
212392
84
Oro
133065
961
132104
99
Western
153304
652
152652
99
Eastern Highlands
432972
5445
427527
98
Enga
295031
1396
293635
99
Simbu
259703
1721
257982
99
Southern Highlands
546265
1131
545134
99
Western Highlands
440025
6175
433850
98
East Sepik
343181
2380
340801
99
Madang
365106
3297
361809
99
Morobe
539404
12136
527268
97
Sandaun
185741
1070
184671
99
Autonomous Region of Bougainville
175160
570
174590
99
East New Britain
220133
6496
213637
97
Manus
43387
3353
40034
New Ireland
118350
1202
117148
West New Britain
184508
1982
182526
13
92
98
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14. PNG Overarching Policies &
Energy Sector Policies
• PNG’s Vision 2050.
- Government sets vision for long term development
and prosperity 2010 – 2050.
- Seven (7) ‘pillars’ natural resources, climate change and
environmental sustainability are among areas of focus.
• PNG Government Strategic Development Plan 2010 –
2030.
– High level of strategic support for energy development.
– All households have access to reliable and affordable energy
supply.
– 70% of PNG be electrified by 2030.
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15. PNG Overarching Policies &
Energy Sector Policies
• The Energy Division of the Department of
Petroleum and Energy (DPE) is responsible for
energy policies and plans, data collection and
analysis and advices the government on energy
sector issues.
• PNG Power Limited (PPL) undertakes power
sector infrastructure planning and developments.
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16. PNG Overarching Policies &
Energy Sector Policies
•
Electricity Industry Policy (EIP)
- Launched in December 2011
- Objectives of EIP are to : improve reliability, accessibility and
affordability of electricity services to the majority of the population.
- Policy measures proposed:
(1) Facilitating competition/contestability under various market
models.
(2) State provisions for consumer service obligations.
(3) Appropriate regulation.
(4) private sector participation.
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17. PNG overarching policies &
Energy Sector Policies
• Draft National Energy Policy (NEP)
- Under review by the Government Task Force on
Policy.
- Sets vision as “ vibrant energy sector that
improves quality of life and supports national
development’”.
• Draft Rural Electrification Policy (REP)
– Early draft stage.
– Sets vision as “ to enhance livelihood of rural population
through sustainable provision of electricity.
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18. PNG Overarching Policies &
Energy Sector Policies
• Draft Geothermal Energy Policy
- The Government has engaged the services of a
private consultant to develop a model for this
policy.
• Draft Renewable Energy Policy
- A lot is to be done.
- Policy is driven by sectors in agriculture, forestry
and environment.
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19. Policy Difficulties
•
•
•
•
Lack of capacity.
Lack of Government focus.
Lack of needed focus.
Lack of coordination in sector policy management.
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20. PNG Electricity Industry Structure
•
Current players
(1) PNG Power Limited
- Government owned.
- Established as a regulatory regime vested with power to plan,
develop, generate, transmit, distribute and sell electricity.
- Vertically integrated.
- Holds monopoly retail transmission sector.
- Generation and distribution are contestable.
(2) IPP’s
- Operate under direct power purchasing agreement.
- Activities are limited and within designated locations.
- Power purchasing arrangements are negotiated on a party-andparty basis rather than through open and competitive
processes.
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21. PNG Electricity Regulatory
Framework
•
Broad Features
- Provides exclusive service (retail) areas for PPL defined as within 10
kilometres of the distribution network operated by PPL for loads under
10 MW.
- Allows for third party producers to generate and supply PPL for the
latter’s sale to consumers.
- Allows for free entry to serve lage consumers (i.e. with loads of 10MW
or more.
- Uses a system of postage stamp pricing in the shape of the national
single tariff (which charges the same price for customers within a
particular category, regardless of location.
- An independent regulator of the electricity industry, the ICCC
implements a form of revenue cap price regulation in relation to PPL,
and sets licence conditions for PPL and other market participants.
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22. PNG’s Renewable Energy Resources:
•
Hydro Energy
– Currently main electricity source for PNG.
– PNG still has significant hydroelectric potential (vast river networks, numerous
creeks, streams and mountain spring water flows.
– By 2035, 800MW of Hydro electricity generating capacity is planned to be
either built or upgraded.
•
Solar Energy
- Largest potential source in PNG.
- Average insolation in most parts of PNG is 400 – 800 W/m² .
- 4.5 – 8 sunshine hours per day all year round.
- To date no solar electricity grids have been installed in PNG.
•
Wind Energy
- Potential source in PNG.
- High wind spots along the northern coastline and on the isolated islands of PNG.
- No major wind turbine power installations, however small wind turbines are being
installed for individual household electricity supplies.
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23. Renewable Energy Sources
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24. Renewable Energy Sources &
Technology Objectives:
•
•
•
•
•
Provide sustainable developments in
economic, social and environmental
sectors in PNG.
Provide sustainable development in
rural electrification in PNG.
Raise the standard of living of the rural
people , 90% of PNG population.
Provide connectivity for information
technology
for
education
and
telemedicine to the rural population in
PNG.
Protect the environment and reduce the
Greenhouse Gases.
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25. Hydro Energy
• Benefits:
–
–
–
–
No fuel costs
Carbon free
Can be distributed near the user
Creates local jobs
• Challenges:
– Initial cost is high, depending on
size.
- pico-hydro power, < 1 KW
- micro-hydro power, 1 - 300 KW
- mini-hydro power, 300kw – 1Mw
- hydro power (large), >1Mw
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26. Solar (Electric and Thermal)
• Benefits:
–
–
–
–
–
No fuel costs
Carbon free
Can be distributed near the user
Thermal is low cost
Creates local jobs
• Challenges:
– Not dispatchable
– Intermittent resource
– PV is still expensive compared
with conventional fuels
– Minimal impact to peak loads
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27. Solar Photovoltaic Power System
Layout
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28. Wind Energy
• Benefits:
–
–
–
–
No fuel costs
Carbon free
Can be distributed near the user
Creates local jobs
• Challenges:
– Not dispatchable
– Intermittent resource
– Minimal impact to peak loads
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29. Wind Energy Power System Layout
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30. Rural Electrification with Renewable
Energy Sources in Papua New Guinea
•
•
Development and adoption of reliable renewable energy sources in rural
areas for rural electrification has become a major challenge to most parts
of the world. eg Europe, USA, India, China, etc.
PNG’s 90% rural population is no exemption. Modern renewable energy
technologies can play a crucial role in developing rural electrification to
provide electricity to the people living in the rural areas of PNG.
•
The role of energy and more specifically electricity is the key player in all
aspects of sustainable development.
•
Sustainable development of the energy sector is a potential factor to
maintain economic competitiveness and progress.
•
Access to modern energy reduces;
–
–
–
–
–
Poverty and hunger through food preservation (MDG1)
It fosters education by providing light and communication tools (MDG2)
It improves gender equality by relieving women of water collecting (MDG3)
It reduces child and maternal mortality, incidences of diseases (MDG4,5,6)
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It directly contributes to global environmental sustainability (MDG7)

31. Elements of Sustainable Rural
Electrification Project
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32. Case Studies
• Wantun Micro-hydro power project,
Markham District, Morobe Province
– Map of Project Site
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33. Case Studies
• Wantun Micro-hydro power project,
Markham District, Morobe Province
– The Feasibility Study Team
The Feasibility Study Team
Wantun Community Learning
and Development Center
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34. Case Studies
• Wantun Micro-hydro power project,
Markham District, Morobe Province
 Micro-hydro Site – Yawai Waterfalls
Water Flow Measurement – Bucket
method.
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35. Case Studies
• Wantun Micro-hydro power project,
Markham District, Morobe Province
 Hydro Power Generated
Taking a gross head measurement of the penstock of 216 meters and a design flow
of 20.0 l/s (or 0.020 m3/s), the hydro power generated by the proposed scheme
can be calculated using the following equation:
Hydro Power (kW) = Head H (m) x Flow Q (m3/s) x 9.81 (acceleration due to gravity)
P = 216 x 0.0200 x 9.81 = 42.38 kW
If we take into consideration the frictional losses in the penstock then the head is
reduced to 200 m (net head) and the hydro power will be reduced to:
P = 200 x 0.0200 x 9.81 = 39.24 kW
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36. Case Studies
• Wantun Micro-hydro power project,
Markham District, Morobe Province
 Electrical Power Calculation
To calculate the electrical power produced by a generator, the efficiency of the
system must be taken into consideration. Typical efficiency for a micro-hydro
system is approximately 85%. This takes into consideration the penstock, turbine,
and the generator losses.
Electrical Power (kW) = Hydro Power x System Efficiency
For the 216 meter head scenario, Electrical Power = 42.38 x 0.85 = 36.02 kW
For the 200 meter head scenario, Electrical Power = 39.24 x 0.85 = 33.35 kW
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37. Case Studies
• Wantun Micro-hydro power project,
Markham District, Morobe Province
Indicative Fixed Flow containerized
Francis turbine.
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38. Micro-grid System for Rural Electrification
38

39. Business Model for Rural
Microgrids
• Challenges
- High capital cost over low returns.
- Rural population usually dispersed.
- Have low consumption rates.
- Lack capacity to pay for electricity services.
“ The key issues to be addressed in developing a sustainable
rural electrification market is how to maximise private
sector investment and minimise subsidies for rural
electrification”.
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40. Business Model for Rural
Microgrids
•
PNG Scenario
The PNG EIP aims to upscale rural electrification
through State financing for consumer service obligation and encourage private
sector participation.
•
Critical steps to consider in order to promote a sustainable business model for rural electrification.
(1) Review and integrate off-grid policy into overall electricity industry policy (regulations, level playing
field).
(2) Design targeted and efficient smart subsidies in a transparent way, secure funding and define exit
strategy.
(3) Adapt public-private partnerships delivery models to local needs and condition.
(4) Support policy development and capacity building.
(5) Ensure that users pay substantial part of lifecycle cost (payments creates ownership)
(6) Involve users and communities in decision and implementation.
(7) Design monitoring mechanisms to supervise both firms and users compliance with the contracts
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41. Hybrid Business Model
•
•
•
•
Community-based model
Private-based model
Utility-based model
Hybrid business model
• PNG Power Limited or a
private
company
implements and owns the
micro-grid power system,
the community manages it
on a daily basis and PPL
or
private
company
provides the technical
back-up and management
advice.
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42. Conclusions
Renewable energy projects can serve a critical niche in
supplying much-needed electricity to rural, off-grid
communities in Papua New Guinea.
Connecting the electricity grid to rural and remote areas is
very uneconomical to carry out. Therefore it is more
economical to electrify the rural areas with a micro-grid by
means of existing renewable energy sources available
locally.
The micro-grid configuration represents energy distribution
architecture from the producing site to consumers and
eventually the interconnection between several sites and
several consumers.
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43. Recommendation
PNG has abundant hydro solar and wind energy potentials
that can be developed under a renewable energy hybrid
business model to fast- track the rural electrification program
and provide electricity to the people living in the rural areas
of Papua New Guinea.
The concept of the micro-grid power system using hydro
integrated renewable energy sources (hydro solar and wind)
is a cost effective and sustainable system and should be
implemented in the rural electrification program in Papua
New Guinea.
The PNG government gives priority to renewable energy
projects, allocate sufficient budget, and create conducive
environment for private sector who are investing on
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renewable energy.

44. Thank you
CONTACT INFORMATION
Rebecca Ogann Kiage
r_kiage@yahoo.com.au
Suapi Management Consultancy
P. O. Box 1885, LAE 411
Morobe Province, PNG.
Sammy Samun Aiau
saiau@ee.unitech.ac.pg
Electrical & Communication Engineering Department
The Papua New Guinea University of Technology
Private mail Bag, LAE 411
Morobe Province, PNG.
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