Can the Pacific become the world’s first fossil-fuel-free zone?

(Eco Business, 18 Feb 2020) With key reforms, Pacific states could move toward cleaner, more affordable sources of energy that eventually eliminate fossil fuels completely.

The Pacific region has a stunning level of fragility related to fossil fuel dependency and world-record high electricity costs. In many Pacific states, particularly small ones, you cannot escape a big and noisy power generation plant with adjacent fuel tanks located in the middle of island. 

At present, Pacific states and economies are largely dependent on hydrocarbons for electricity. Imported fuel is over 90 per cent of the energy mix and costs about 75 per cent of power utilities’ operating costs. Given the size of economies in the Pacific, hydrocarbons remain one of their largest imports.

As many Pacific utilities are generating electricity from imported fossil fuel, they are exposed to a significant liquidity gap due to high technical losses, poor collections and other operational deficiencies. With very high tariffs for electricity, power utilities in many Pacific states rely on direct cash injections from the state at about 30 per cent of revenues to offset inefficient and loss-making generation from fossil fuel.

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Eco Business, 18 Feb 2020: Can the Pacific become the world’s first fossil-fuel-free zone?