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Decision To Discontinue Power Purchase Agreement "Unethical”

by PNG Business News - June 07, 2021

Photo Credit: Loop PNG - Patrick Pruaitch

PNG Power Ltd's decision to cancel a power purchase agreement (PPA) with PNG Biomass, which was signed six years ago, is immoral, according to Aitape-Lumi MP Patrick Pruaitch. He said that the biomass project was well-conceived and performed, and it would have benefited communities and landowners.

He claimed that PNG Power and the government delayed final project clearances. He said that terminating the PPA was immoral since it had allowed PNG Biomass to complete feasibility studies and begin planning and execution, including a sustainable tree farming initiative with local landowners, at a significant expense. Landowners utilized their first land rental payments from PNG Biomass three years ago to purchase a three-tonne truck, providing an economic stream for the local community, as a result of these commitments. Local farmers have been able to develop a thriving honey business employing native stingless bees, with additional large profits from "intercropping," thanks to technical aid from PNG Biomass. 

According to Pruaitch, the Independent Consumer and Competition Commission authorized a US54c (K1.89) per kilowatt-hour reference pricing for the Ramu grid in August 2016 based on the PPA signed by PNG Power with PNG Biomass.

 

Reference:

The National (3 June 2021). “MP says PPL’s decision to end deal was ‘unethical’”



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