Market News

 February 20, 2012
Tongan Government Moves Forward on Goal for 50% Renewable Energy by 2015

 Can you even imagine the United States setting a 50% target for renewable energy production by 2015?

Perhaps the U.S. could look toward the Kingdom of Tonga for some inspiration.
Tonga is one of many Pacific island nations that have set very ambitious renewable energy goals. Officials have set a goal of procuring 50% of power from renewable sources by 2015. Ambitious? Absolutely. But the transition is a matter of economic necessity.

Launched in 2010, the Tongan government laid out its Tonga Energy Road Map (TERM) in order to reduce carbon emissions, improve its electrical grid, and cut its dependence from foreign energy sources. Because Tonga is so dependent on imported resources for its energy needs --- particularly diesel, which is used for 98% of electricity production --- renewable energy systems are attractive:

The Tongan economy and electricity consumers have been exposed to high and volatile electricity prices linked to oil prices over the last ten years. Between 2001 and 2004, the average price of crude oil increased from around US$25 per barrel to around US$40 per barrel, an increase of 60%. In the next 4 years to 2008, the average price of crude more than doubled to a peak of around US$100 per barrel. In late 2008, crude oil prices dropped and continued fall into early 2009 averaging around US$62 per barrel during 2009. Diesel prices tracked the price of crude oil and led to Tongan electricity rates exceeding TOP1.00/kW-h in late 2008. Crude oil price is expected to increase in the future based on projections from the United States Department of Energy.

During the oil price spike in 2008, Tonga's economy screeched to a halt. And since then, with oil prices continuing to rise, many consumers are not able to afford electricity at all.

In order to combat this problem, the island state recently received support from different organizations to execute on the roadmap for 50% renewable electricity.

With grants from the government of New Zealand to upgrade and expand outdated grid distribution, and technical support from the Renewable Energy & Energy Efficiency Program (REEEP) to expand its renewable energy portfolio, Tonga could very well become "a blueprint for other Pacific Island states that are grappling with similar challenges," said Martin Hiller, the Director General of REEEP.

In January, Tonga signed an MOU with project developer Madsar and the Abu Dhabi Fund for construction of a 500-kilowatt solar PV project on Vava'u Island. The project will provide affordable, clean power for over 13% of Tonga's 110,000 citizens.

The government has already broken ground on a large solar farm on its main island of Tongatapu with the help of another New Zealand grant, which will result in significant "diesel savings of around half a million liters a year, and around two-thousand tons of carbon emissions will be reduced per year as well."

That's one of the major differences between inertia in the U.S. and swift action in a place like Tonga: economic urgency. Until America faces an acute crisis, political leaders will likely continue to drag their feet on clean energy.