Energy Fiji Limited (EFL) has emphasized the importance of approving a tariff increase to sustain Fiji’s ambitions for renewable energy and ensure the company’s financial health. In its recent non-confidential electricity tariff submission, EFL expressed concerns that without an increase in tariffs, significant renewable energy projects could face delays, leading to a heightened dependence on costly thermal fuel generation.
The company has ambitious plans to invest nearly $1 billion over the next five years as part of its 10-year Power Development Plan, which includes large hydro projects on Viti Levu. EFL cautioned that if tariffs remain the same, its debt could surpass $1.1 billion by 2027, jeopardizing compliance with acceptable gearing levels mandated by lenders.
Furthermore, EFL pointed to escalating costs related to maintenance, fuel, and financing, alongside a rapidly expanding asset base, which have adversely affected returns under the current tariff structure. The proposed tariff increase is seen as crucial not only for ensuring a dependable power supply but also for meeting the target of 90 percent renewable energy by 2035. It would also help minimize the potential need for future government bailouts, thereby providing a more stable financial outlook for Fiji’s energy sector.
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