Energy Fiji Limited (EFL) has emphasized the importance of approving a tariff increase to safeguard Fiji’s renewable energy objectives and ensure the company’s financial health. In its latest electricity tariff submission, which is non-confidential, EFL cautions that without a hike in tariffs, there could be significant delays in major renewable energy initiatives. This, in turn, could lead to a dependence on costly thermal fuel generation.
EFL has plans to invest nearly $1 billion over the next five years as part of its 10-year Power Development Plan. This plan includes several substantial hydro projects on the island of Viti Levu, aimed at enhancing the country’s renewable energy landscape. However, the submission warns that if tariffs remain unchanged, EFL’s debt could exceed $1.1 billion by 2027, which would push the company beyond the acceptable gearing levels set by its lenders.
Additionally, EFL highlights that soaring maintenance, fuel, and financing costs, coupled with a rapidly expanding asset base, have diminished returns under the current tariff structure. The proposed increase in tariffs is seen as a necessary step to provide a dependable power supply, support the ambitious goal of achieving 90 percent renewable energy by 2035, and mitigate the potential need for future government bailouts.
By pursuing this tariff adjustment, Energy Fiji Limited aims to not only enhance its operational viability but also contribute positively to Fiji’s commitment to sustainable energy solutions.