بســم اللّـه الرّحمـن الرّحيــم
Your Highness Sheikh Mohamed bin Rashid Al Maktoum, Vice President and PM of UAE and Ruler of Dubai,
Your Majesties, Your Highnesses, Excellecies, Ladies and Gentlemen.
I would like to thank His Highness Sheikh Mohammed bin Rashid Al Maktoum, VP and PM of UAE and Ruler of Dubai and the Government of Dubai for the warm hospitality extended to us and for hosting the World Energy Forum 2012.
A sound energy policy is necessary for sustainable development. A development path primarily based on expensive diesel generated electricity is unsustainable in any country, let alone a small country like Maldives. Today, we spend the equivalent of 20 percent of our GDP on diesel for electricity and transportation. We have already reached the point where the current expenditure on oil has become an obstacle to economic growth and development.
Today the cost of electricity has reached between 35 to 70 US cents per KW hour of electricity depending on variable cost of transportation and efficiency of power plants. This is unaffordable especially to rural communities. Consequently, the government is providing heavy fuel subsidies to the consumers. We have no option but to move to a smarter energy policy.
As a result we have now embarked on an ambitious programme for achieving a low carbon economy. We believe that transformation of our energy sector through renewable energy and greater energy efficiency as a necessary process for achieving a sustainable future.
We in the Maldives have made a genuine and ambitious commitment toward achieving a low carbon economy. Our energy policies and sustainable development strategies have been shaped to accomplish this mission.
Our strategy to transform the energy sector is based on three important pillars: firstly to develop the capacity of public utility companies and private service providers. The second pillar is a strong and convincing business model to attract and integrate the private and public sector behind a future oriented growth model. Thirdly we intend to strengthen the necessary legislative instruments in order to provide the regulatory framework for investors and stakeholders in the renewable energy sector.
Let me share with you today some highlights of our plan of actions for the coming five years.
Our main programme for the capital island Male’ and for those of our islands that have a medium to large scale electricity demand will be based on the introduction of Feed in Tariffs. They will provide the incentive to the private sector to work together with the public utilities to install renewable energy technologies such as solar PV or wind as viable alternatives.
Altogether our target is the introduction of 20 megawatts installed capacity from renewable energy technology sources on 30 islands with medium to large scale electricity demand.
Our programme for smaller islands with a lower electricity demand will support achieving the installation of full Renewable Energy technology systems on 10 islands. This will enhance the lives of these small populations and become an example of how small and remote communities can meet their electricity demand from 100% renewable sources.
In addition, we plan to upgrade power systems on 15 islands with high and medium electricity demand so that they can accept a 20 to 30 percent share of renewable energy.
Under this strategy, through installation of up to 27 megawatts of renewable electricity, we will be saving on the use of 22 million liters of diesel per year and reduce up to 65,000 tons of carbon dioxide emissions each year. In addition we will be making significant savings from the heavy fuel and other electricity usage subsidies that are currently in place.
We are mindful that these programmes cannot be implemented without the engagement of the private sector. In order to make the investment environment more favorable for the private investors, a number of attractive financial guarantee instruments and measures will be adopted.
We have analyzed the situation in other countries that have long experience with such instruments and will combine favorable tariffs with standard power purchase agreements to take into account perceived levels of risks and returns that are appropriate to this type of investments. We will also place a strong emphasis on utilizing guarantee instruments to cover payment, currency depreciation and related risks that may be of concerns to potential investors.
In summary our goal is to create an enabling environment for the growth of a reliable and sustainable energy sector in the Maldives. Under the new energy policy, we will reduce the over reliance of the energy sector and the national economy on fossil fuels through the diversification of energy supplies.
We will improve our energy efficiency and conservation,
We will adopt low-carbon technologies in the production, distribution and energy consumption through the promotion of environment friendly and sustainable lifestyles,
We want to exploit our local energy resources and renewable technologies.
And last but not least we will aggressively pursue private sector investments in the development of the energy sector.
Ladies and Gentlemen,
As a small island developing state, we face enormous challenges in achieving our ambitions towards low carbon development. We have embarked on this mission with little technical knowhow of renewable energy technologies. Our private sector is only just beginning to realize the benefits of investing in these technologies. Existing power systems need extensive upgrading to prepare for these changes. And most of all, we need to mobilize the necessary finance to make this transformation. Equally important will be developing our human and institutional capacities.
Although we don't have the experience to do what we propose, we are determined to make this happen. I remain firm in my conviction that it is possible to achieve a low carbon sustainable development provided that we get our communities to adopt the behavioral changes necessary to achieve greater efficiency. I also believe that there are development partners who are willing and able to accompany us in this ambitious programme.
This is why I am taking the necessary steps to create an investor friendly environment to facilitate private sector investment in renewable energy technology and build the national capacity. My country also welcomes all the support we receive from friendly nation states and our international partners towards achieving our goal.
Ladies and Gentlemen,
I think, it is time to recognize that if we are to achieve sustained development we will have to bring about significant changes to the way we produce and utilize energy.
I sincerely hope that this Conference will send out a strong message to political leaders that a “business-as-usual approach” to energy policy no longer makes sense. Let us use the next few days to explore the many new options and work together sincerely on concrete actions plans and time tables to implement those options for solving the global energy and climate challenges.
I am sure together we can.
Thank you for your attention.