PRIVATIZING PNG POWER IS NECESSARY BUT NOT SUFFICIENT FOR IMPROVED ACCESS TO ELECTRICITY
23 SEPTEMBER 2014
The PNG Power problems that have come to the limelight recently had been festering for some time and the current Government's announcement to privatize this entity and other State Owned Enterprises (SOEs) is welcome news. However, from the statements made, it is not clear what aspects of PNG Power will be privatized, where and how competition can be introduced, where can Public Private Partnerships be introduced and how regulatory functions that obviously cannot be privatized, is retained under State control. There is obviously a need for more thorough analysis and proper structured reforms undertaken after considerable consultations among all stakeholders. Whatever decision is taken, the problems will not be easily resolved but will take time for the full results to emerge, only if consistency is maintained in implementation.
Divesting ownership in its current form may not result in desired outcomes. It will only be a “band aid” approach and will not address adequately all the underlying problems. We need to look objectively at what we want to achieve and then explore the different mechanisms through which we can attain the end goals.
In this commentary, I look at PNG Power issues and discuss possible options for reforms.
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