The European Investment Bank (EIB) today formally agreed to provide technical assistance for renewable energy development to the government of the Solomon Islands. The agreement was signed today between the Minister for Mines, Energy and Rural Electrification and the EIB.
The technical assistance proposal concerns a full technical-economic feasibility study for the development of a hydroelectric scheme on the Tina River, some 30 km southwest of Honiara, on the island of Guadalcanal, in the Solomon Islands.
The Feasibility Study will cover a detailed technical assessment, preliminary design and costing, and financial viability assessment of the hydropower development, including a preliminary environmental and social assessment. The feasibility study will include the preparation of the essential technical and economic documentation to be presented to potential private sector investors for the financing of the project. In supporting the involvement of the private sector in the energy sector in the Solomon Islands, the project is fully in line with the Cotonou II mandate. Furthermore, in providing electricity from a renewable source, substituting for fossil fuel-fired generating plant, the project will generate significant environmental benefits and contribute to combating climate change.
The project is being supported by the World Bank, which is also providing assistance to the Solomon Islands Electricity Authority under the Solomon Islands Sustainable Energy Project (SISEP). The IFC, a member of the World Bank Group, is providing transaction advisory services to the government for preparation and implementation of the project.
This technical assistance agreement is one of a number of initiatives financed by the EIB in the South Pacific region currently being approved during a regional tour by Bank representatives.
The European Investment Bank (EIB) was set up in 1958 by the Treaty of Rome as the long-term lending Bank of the European Union. The European Investment Bank has significantly increased its contribution to the long-term development of the Pacific countries economies over the last five years. In line with priorities set by the Cotonou mandate and in close cooperation with the European Commission, financing of private sector and environmental projects will remain centre stage in future EIB activities. EIB lending in the Pacific builds on the region's strengths, supporting and promoting economic growth and employment.
Since the start of operations in the Pacific the EIB has funded loans and equity worth over EUR 380m to support economic activity in a region hampered by the high cost of developing infrastructure across widely dispersed and remote small island countries.