Committee flags major issues within Energy Fiji Limited

Energy Fiji Limited (EFL) faces scrutiny from the Standing Committee on Economic Affairs, which has identified several critical issues requiring immediate attention. The committee's review of EFL's 2023 and 2024 consolidated annual reports revealed a persistent and concerning dependence on imported diesel, which remains the company's highest operating cost.

This reliance exposes both EFL and consumers to the volatility of global fuel prices. Committee Chair Sakiusa Tubuna pointed out that despite Fiji's national target of achieving 90 percent renewable energy generation by 2035, progress in reducing fuel dependency is not advancing quickly enough to meet this objective.

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This remains EFL’s highest operating cost and exposes both the company and consumers to fluctuations in global fuel prices.

Furthermore, the committee observed rising debt levels and ongoing financial pressures. Tubuna warned that if these are not managed carefully, they could jeopardize EFL's long-term financial sustainability. The review also uncovered significant deficiencies in transparency and reporting. Specifically, the committee found limited disclosure regarding dividends paid to customer shareholders, how interest earned on customer security deposits is treated, and the outcomes of rural electrification programs.

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Such information is essential for ensuring public confidence, promoting accountability, and enabling Parliament and consumers to assess whether EFL is delivering equitable benefits to all stakeholders.

Tubuna emphasized that such information is crucial for maintaining public trust, ensuring accountability, and allowing Parliament and consumers to assess whether EFL is delivering equitable benefits. The committee also expressed concern over substantial expenditures on hiring containerized diesel generators. While acknowledging challenges like increasing electricity demand and climate impacts on hydroelectric generation, Tubuna stressed that these costs highlight the need for stronger long-term planning, timely investment in renewable energy, and more effective management of generation capacity.

To address these shortcomings, the committee has proposed several recommendations. These include developing a clear Renewable Energy Transition Plan, strengthening debt management strategies, enhancing reporting on capital expenditure, and improving transparency in financial matters related to shareholders and consumers. The committee believes these measures will foster better planning, increase transparency, bolster financial stability, and ensure that energy sector investments yield tangible benefits for consumers and the wider community.

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These costs underscore the importance of stronger long-term planning, timely investment in renewable energy projects, and more effective management of generation capacity requirements.