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Pacific Islands Development Program, East-West Center

With Support From Center for Pacific Islands Studies, University of Hawai‘i


Palau Unlikely To Approve Solar Electricity Agreement
House of Delegates raises concerns about implications of deal

By Aurea Gerundio-Dizon

KOROR, Palau (Island Times, Jan. 3, 2013) – The Senate Joint Resolution to endorse and ratify agreements between the Republic of Palau and Earth Energy International Co., Ltd. to build a solar-powered generator and provide electric power to the islands is unlikely to pass in the House of Delegates, a delegate expressed yesterday.

The delegate disclosed that most of his colleagues are convinced not to adopt the resolution as there are reportedly so many legal implications.

Those not favorable for the adoption of the resolution reportedly expressed concern on some provisions in the agreements. To name a few, the exemption from FIB requirements, exemption from Labor requirements and granting of permanent resident status to employees hired by EEC.

Moreover, majority of the delegates are reportedly concerned that Palau is going to be locked with $.39 cents for 30 years when there could be other companies with cheaper ways to deliver solar energy.

Palau Public Utilities Corporation’s disagreement with this project is also considered by majority of the HOD members according to the delegate.

The delegate further said that majority of them in the House are concerned with the payment of $15 million (as a bond) to EEC if the government is going to terminate the agreement.

The resolution disclosed that ROP, through the president, has entered into five phases of build, operate and transfer agreements with EEC. The delegate said that if the government terminates the agreements, it will be bound to pay $75 million.

The delegate said that the ROP-EEC agreements require much analysis before the House ratifies it. He hopes that the House Committee on Resource, Commerce, Trade and Development will conduct public hearing before the resolution is brought to the floor and be voted on.

Today, the House is reportedly scheduled to have session at 3 p.m. However, it is not known as of this writing whether or not the resolution ratifying ROP-EEC agreements will be in the agenda.

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