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Request for Quotations

Review of the Ha’apai Solar Electricity Incorporated

Background:

The Pacific Islands Greenhouse Gas Abatement through Renewable Energy Project (PIGGAREP) is a regional climate change mitigation project that was approved for funding by the Global Environment Facility (GEF) in September 2006.The project is for eleven Pacific Island Countries (PIC) – Cook Islands, Fiji, Kiribati, Nauru, Niue, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu with the United Nations Development Programme (UNDP) as the GEF Implementing Agency and the Secretariat of the Pacific Regional Environment Programme (SPREP) as the Implementing Partner.

The global environment and development goal of PIGGAREP is the reduction of the growth rate of green house gas (GHG) emissions from the fossil fuel use in the PICs through the removal of the barriers to the widespread and cost effective use of feasible renewable energy (RE) technologies. The specific objective of the project is the promotion of the productive use of RE to reduce GHG emission by removing the major barriers to the widespread and cost-effective use of commercially viable RE technologies (RETs). PIGGAREP consists of various activities whose outputs will contribute to the removal of the major barriers to the widespread utilization of RETs. The project is expected to bring about in the PICs: (1) Increased number of successful commercial RE applications; (2) Expanded market for RET applications; (3) Enhanced institutional capacity to design, implement and monitor RE projects; (4) Availability and accessibility of financing to existing and new RE projects; (5) Strengthened legal and regulatory structures in the energy and environmental sectors; and (6) Increased awareness and knowledge on RE and RETs among key stakeholders.

Tonga is one of the participating PICs in the PIGGAREP and one of the activities in its 2008 Work Plan and Budget is Supporting the technical, financial and institutional designs of the Niuatoputapu and Lofanga Islands Solar Electrification (NALISE) Project . This support will be through reviewing the technical, institutional, financial and management structures of the Ha’apai Solar Electricity Incorporated (HSEI) and using the experiences from this project in finalizing the design of the NALISE project. The support will also include convening a meeting of the HSEI’s management committee to consider the draft review report.

Instructions to Offerors:

• The Quotation must cover all the objectives, outputs and activities as specified in the ToR
• The Quotation must include costs for professional fees, travel and per diem
• As part of PIGGAREP’s capacity building activities, quotation must include the local travel and per diem costs of one officer from the Tonga Energy Planning Unit who shall join the international consultant(s) as the local coordinator and a trainee
• US$ only must be used in the Quotation
• The Quotation must include: i) an updated CV of the individual/s who will undertake the consultancy ii) a summary of recent work in the areas to be covered in this consultancy (including client and work produced); ii) information on availability; iii) total person days proposed for the work on the consultancy and daily rate in US$ and iv) a preliminary methodology and work plan (maximum 3 pages)
• The consultancy preferably should commence in May 2008 and must be completed before end of July 2008
• The offer must be in the English language only
• The above-mentioned documents, information and requirements are mandatory and as such are required to form a complete tender. An offer will be rejected unless it is substantially responsive
• If the Quotation is received prior to the formal submission date corrections/modifications can be made up to that date
• The Quotation must be submitted in electronic format only (Word and PDF format, 1 MB max) by email to the e-mail address specified below
• The consultancy must be undertaken with one (1) field visit to the PV installations of the HSEI. The exact number of working days will be determined subsequently between the successful Contractor, the Energy Planning Unit and SPREP

The final working plan will be determined subsequently between the successful Contractor, the Tonga Energy Planning Unit and PIGGAREP.

Award of Contract and Evaluation Criteria:

Quotations will be evaluated according to the following criteria:

1. Price (20%)

2. Relevant Experience in reviewing Rural Development Programmes in SIDS (30%)

3. Experience with the Tonga’s and / or SIDS energy and socio-economic environments (20%)
4. Methodology / Work Plan (30%)

All quotations must be addressed to:

                      The Director

                      SPREP                                            Telephone: (685) 21 929

                      PO Box 240                                     Fax:   (685) 20 231

                      Apia, Samoa                                   E-mail: SPREP@sprep.org

Deadline for the submission of quotations is 30 April 2008, Samoa time.

Contact Information:

ANNEX A

TERMS OF REFERENCE

Review of the Ha’apai Solar Electricity Incorporated

Introduction

Tonga, like many other Pacific Island Countries, has a priority of providing reliable and cost effective electricity to its remote islands and rural villages. Through various donor-funded programmes, it has provided solar home systems of varying designs and management structures to its outer islands.

The Tonga Outer Islands Solar Electrification Programme (TOISEP) is currently planning major solar electrification installations through the Italy-Pacific Islands Cooperation Programme and the EDF 10 Multi-Country Energy Programme. Tonga has signed the EDF 10 financing agreement with an allocation of 5 million Euros for renewable energy. P ossible projects under this programme include a wind park in Tongatapu, stand alone systems in different locations and some hybrid micro-grids in villages where they already have diesel generators.

The Pacific Rural/Renewable Energy France & Australia Common Endeavour (PREFACE) provided 169 installations in the Ha’apai Group. The PREFACE installations were supposed to be a model for future solar electrification projects in the Kingdom. The project has been running for 6 years now. It is therefore timely that the sustainability of the PREFACE project in Tonga be reviewed and use the lessons learnt in the design of the Italian and EDF 10 programmes.

In her effort to promote the widespread utilisation of renewable energy, the Tonga government has adopted a Renewable Energy Policy with a vision “that by the year 2015, the country achieves an optimal socio-economic structure achieved by sustainable energy development” and a goal of “the provision of sufficient, socially, financially, economically, technically, politically and environmentally sustainable renewable energy systems.” Further, the Tonga government has drafted a Renewable Energy Bill. The principal objects of this Act are:

• encouraging the use of commercially sustainable renewable energy technology for both grid connected and stand alone power supply systems;
• regulating the technical and safety standards for renewable energy technologies;
• regulating the licensing of persons involved in the design, research, installation and management of renewable energy projects;
• regulating renewable energy operators;
• regulating the feed-in tariffs for renewable energy generated electricity;
• supporting the engagement of the private sector in renewable energy projects in the Kingdom.

Background

The TOISEP has been in operation since 1987 with its first European Union-funded project on the islands of Taunga and then Mango in 1988. These first two projects were part of the Lomé II Pacific Regional Energy Programme’s pilot photovoltaic programme aimed at reducing the dependence on petroleum fuels and assessing these technologies in terms of their technical and economic suitability in the region. Residual funds from the same programme provided for the electrification of the island of Mo’unga’one in 1994. The TOISEP is managed by the Energy Planning Unit (EPU) of the Ministry of Lands, Survey and Natural Resources.

The PREFACE project was a jointly funded French-Australian regional renewable energy project for the Pacific Region. It was established under the Secretariat of the Pacific Community (SPC) in Noumea, New Caledonia. It has as its goal “to advance the social and economic development through the use of sustainable renewable energy technologies in the SPC region” with the purpose “to increase the utilisation of sustainable renewable energy technologies, in particular solar photovoltaic and wind energy technologies, in island and rural communities”. The project was designed to provide demonstrations of sustainable projects in solar photovoltaic and wind electrification for rural areas in Melanesia, Polynesia and Micronesia and to be models for the PICs in developing renewable energy projects.

Prior to the PREFACE, a total of 582 solar PV systems have been installed throughout Tonga under the TOISEP. The project in Tonga was therefore selected to be supported by PREFACE on the basis that it should aim at getting close to the critical mass and bringing all existing and future solar home systems in Tonga into one standard technical, financial, institutional and management structure.

The islands electrified under PREFACE included Fonoifua (24 households), ‘O’ua (38 installations), Kotu (35 installation), Tungua (32 installations), Matuku (22 households) and Fotuha’a (18 installations) for a total of 169 installations. These installations were commissioned in April 2002.

The PREFACE installations included 50 Wp PV panels, open cell, deep discharge batteries with a capacity of 120 Ah. Included in the project were Total-Energie regulators, DC-DC converter for operating radios, high efficiency fluorescent tubes with open reflectors for indoor lights and with a weather casing for exterior lighting. The system size is sufficient to allow the exterior lights to be used as street lighting, though users are advised to turn them off during cloudy periods. The maintenance was designed to be provided by island residents trained by PREFACE and the Energy Planning Unit in the troubleshooting and maintenance of the systems. A well-trained government PV technician is available on the main island of the Ha’apai group. He will make periodic visits to inspect the installations and provide supervision for the island technicians. Overall operational management is by a HSEI with a management committee that includes user representatives from each island, the Governor of Ha’apai, and an Energy Planning Unit officer. Island technicians are salaried employees of the committee. Users were charged a “connection” fee of T$200 (T$2 @ US$1) and a monthly fee of $13.

A comparison of the earlier PV projects in the TOISEP and those of the PREFACE can be seen in the Table below:

T$ is approximately .5 US$

Objective

The general objective of the consultancy is to conduct a diagnostic review of the technical, financial and institutional sustainability of the HSEI. Based on the review and in line with the objects of the Renewable Energy Bill, recommend technical, financial, institutional and management measures for improving the sustainability of the HSEI as well as for the TOISEP in general.

Methodology

The review will include a desk study of relevant documents about the TOISEP, the HSEI and the various solar electrification models used in the PICs and SIDS. It will include a visit to Tonga to examine the books of the HSEI and to speak with the Energy Planning Unit, relevant government and non-government officials and communities of the Ha’apai Group. As part of the capacity building element of the PIGGAREP, the Consultant must work together with an officer of the EPU as its local counterpart. The review will include a visit to all the solar PV installations of the HSEI .

The lead consultant need not visit all the PV installations. Instead, he/she may visit 1 or 2 islands and show the local counterpart how to do the measurements, etc. The local counterpart can then complete the visit to the rest of the PV installations.

Specific Tasks

The consultant shall undertake the following specific tasks:   

1. Desk Study

2. Site Visit

3. Interview of the project stakeholders

4. Debriefing

5. Final Report

1. Desk Study

The desk study shall include a study of the relevant reports about the PREFACE. This shall include, but not limited to, the following:

• The PREFACE Project Document

• The TOISEP Project Proposal

• Feasibility study of the Ha’apai PREFACE Project

• Terminal Review of the PREFACE Project

• Records of the meeting of the HSEI

• Technical and Financial reports of the HSEI

• Management Guidelines of the HSEI

• PREFACE Project tender documents and products specifications

• Tonga’s Renewable Energy Policy and Renewable Energy Bill

• Other institutional and management structures for renewable energy / solar utilities in the SIDS (including The Kiribati Solar Energy Company)

• Reports of similar reviews, like the PIEPSAP review of the Namdrik project in RMI

2. Site Visit

The site visit will be to Nuku’alofa, Pangai and 1 or 2 islands at the Ha’apai Group. At Nuku’alofa the local counterpart from the Energy Planning Unit shall join the Consultant. At Nuku’alofa, the Consultant will meet with officers of the Energy Planning Unit as well as with the CEO of the Ministry of Lands, Survey and Natural Resources. From Nuku’alofa, the Consultant and local counterpart will leave for Pangai, Ha’apai where they will be joined by the Pangai-based Energy Officer who is looking after the HSEI in there. The Consultant will have the opportunity to examine the books of the HSEI. The Consultant shall then visit 2 islands of the HSEI to observe and take measurements of the installations and to speak with the two communities.

3. Interview of the project stakeholders

The interview of the project stakeholder will begin at Nuku’alofa then continue to Pangai and to the project islands. While the Consultant will only visit 2 islands, it will be arranged that at least 3-4 Town Officers and Island Technicians will meet with the Consultant on one of the two islands to be visited.

4. Debriefing

Upon returning from the site visit, the Consultant shall carry out a debriefing meeting with the Ministry of Lands, Survey and Natural Resource at Nuku’alofa.

5. Final Report

The Consultant shall provide a draft review report to the PIGGAREP PMO and the EPU for their comments. The EPU shall then convene a meeting of the management committee of the HSEI to discuss the report. The outcome of this meeting shall then be provided to the Consultant to assist in finalizing the report.

The PIEPSAP is the Pacific Islands Energy Policy and Strategic Action Plan Project, funded by the Danish government and implemented by SOPAC.

The Analysis

The analysis conducted as part of this study shall include but not limited to the following:

Technical

The technical analysis shall include the following:

• Assess the appropriateness of the technical design of the project as compared with the general needs for electricity in these communities, the ability to pay for the energy services and the level of resident technical expertise to maintain the solar installations

• Assess the technical status of the installed system components and estimate their remaining life and the future costs for their replacements

• Assess the effectiveness of the technical training given to the island technicians

• Assess the technical and management arrangements for the regular monitoring of the system components, the maintenance and the supply of spare parts

Financial

• Assess the appropriateness of the current monthly fee charged, reconnection charge and all revenue earning activities of the HSEI

• Assess the appropriateness of the wages level for the islands technicians and the Pangai-based senior technician

• Assess the financial status of the HSEI and compare to its future management and maintenance obligations, etc

• Assess the transparency and accountability of the HSEI’s operations

Institutional

• Assess the appropriateness of the current institutional arrangements for the HSEI in terms of effectively and efficiently meeting its mandate

• Assess the appropriateness of the staffing level and the skills of people that are employed by the HSEI as well as the assistance from the EPU

• Assess the effectiveness of the project management committee and the appropriateness of the project management guidelines

Management

• Assess the general effectiveness of the HSEI in terms of promoting the technical and financial sustainability of the HSEI.

The analysis will conclude with a determination of the future courses of actions based on lessons learned/experiences gained and in line with the objects of the Renewable Energy Bill.

Outputs

The outputs of the consultancy will be a comprehensive review report covering the technical, institutional and financial sustainability of the HSEI as of the present time, with the appropriate recommendations and actions for improving its future sustainability.