OREANDA-NEWS. The Asian Development Bank (ADB) is providing a $2 million grant to help reduce the Marshall Islands’ consumption of fossil fuels and increase renewable electricity generation in the country.

The grant, provided by ADB’s Special Funds, was signed today by the President of the Marshall Islands Hilda Heine and Michael Trainor, Energy Specialist at ADB’s Pacific Department, at a ceremony in Majuro.

The Majuro Power Network Strengthening Project will be financed by an ADB-supported Pacific Renewable Energy Investment Facility approved in June. The facility is funding a series of renewable energy projects and sector reform in the smallest 11 Pacific island countries consisting of the Cook Islands, the Federated States of Micronesia, Kiribati, Nauru, Palau, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu. The target countries face similar development challenges including small populations, limited resources, remoteness, and vulnerability to natural disasters.

“The project will support the country’s renewable energy goal of achieving 20% renewable electricity generation by 2020,” said Mr. Trainor. “ADB will help install an advanced metering infrastructure to allow the Marshalls Energy Company to identify and reduce losses on the Majuro power system, improve revenue collection, and plan for the installation of distributed renewable energy generation in the Majuro power system.”

The Marshalls Energy Company, the project’s beneficiary, is a state-owned electricity utility which generates, distributes, and retails electricity in the capital Majuro, which has 28,000 residents or roughly half of the Marshall Islands’ entire population. Diesel generation accounts for about 98% of annual power generation in Majuro.

To complement the metering investment, the project will assess the Marshalls Energy Company’s business processes, management practices, and policies and governance arrangements, and prepare a roadmap for action to help make the energy company a more self-sustaining and efficient electric power utility.

ADB has been working with the Government of the Marshall Islands since 1990 and has approved 14 loans totaling $92.63 million, 6 grants totaling $11.26 million, and 52 technical assistance projects worth $22.17 million.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members—48 from the region. In 2016, ADB assistance totaled $31.7 billion, including $14 billion in cofinancing.