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Niue and Tokelau (2012)

Source: REEEP Policy Database (contributed by SERN for REEEP)

This policy & regulatory overview is not updated anymore since 2015. We decided to keep it online due to high demand but would like to make you aware of the fact that it might be outdated.

Energy sources

Total installed electricity capacity (2007): 1.4 MW
Diesel: 100%

Total primary energy supply (2006): 2.52 ktoe

For many centuries, Niue was self sufficient in energy production. Most energy was used for cooking in an Umu, or earthen oven, with the fuel used being renewable timbers.  Today Niue is served by efficient diesel powered generators.

In 2009, NPC generated 3.9 GWh of electricity of which 3.4 GWh was sold, recording an estimated 13% distribution loss.

Prior to 2008, electricity for cooking and water heating accounted for most of the energy consumption at the household level.

Through the REP-5 Programme (2006–2010), solar hot water systems and LPG cook stoves were installed in households around Niue benefiting 70% of the population.

In terms of renewable electricity generation in Niue, three grid-connected solar PV systems totalling 52.5 kWp were installed in 2009 by the REP-5 Programme. These have contributed around 0.3% of renewable energy to Niue’s overall energy consumption. The gridconnected solar PV systems are also estimated to save 18,000 litres of diesel fuel a year and contribute some 2% in clean electricity production.

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Reliance

Almost 100% of energy is imported. Niue spends US$1.9 million on fuel imports, nearly one third of Niue’s foreign aid income. Diesel fuel for the electricity and transport sector accounts for the biggest portion of fuel imported into Niue, with over 60% of diesel used for electricity generation. Petrol imported into the country is mainly used for transportation.

Fuel is delivered roughly once every three months. The retail price is set by the government, and a $0.10 per litre tax applied to automotive diesel oil (ADO), petrol and jet fuel. Imports have risen rapidly over the past decade, despite a declining population, though a slower growth is expected for the future as appliance usage approaches saturation.

Niue imported an estimated 33 bbl/day of oil in 2009 and consumed approximately 40 bbl/day in 2010.

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Extend network

Prior to 2004, there was 100% electrification rate in Niue where all residences and businesses have access to the grid line. However, since Hurricane Heta in 2004, a number of households have moved inland from the coast, removing them from access to electricity. Current estimates based on the 2011 Niue planning and policy workshop stand at around 99%.

Much of the power generation and transmission system has been identified as being in need of replacement, and large flow batteries are currently being employed in an effort to improve network stability.

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Capacity concerns

Due to its geographic and demographic conditions, the island's energy sector is highly vulnerable and dependent on imported fossil fuels. Electricity in Niue is generated by diesel-powered generators, which is the major source of greenhouse gas emissions from the Island. Rising diesel prices have led to rising electricity costs.  Diversification in energy supply is one of the major goals of the current Niuean government, with particular reference to the island's considerable renewable energy potentials. With electricity prices that are some six times higher than the typical Australian consumer prices, renewables should be commercially viable.

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Renewable energy

Solar energy
Niue has ample solar resources, more than sufficient to meet all its energy needs. Average horizontal irradiation over the year is 5.4 kWh/m2/day. Both photovoltaics (PV) and solar thermal systems have seen use in the country. The country received 9 grid-connected PV systems for use in the country's hospital and high school, with a total capacity of 52 kW. Over 240 solar thermal units have also been provided at discounted rates to home-owners in the country. However, the maximum impact that is practical to attain is unlikely to exceed 5% of the energy delivered by the NPC grid.

Wind energy
Niue has one of the highest wind-energy intensities in the South Pacific. Mean wind speeds of 6 m/s were recorded over a two-year period on the eastern side of the island, which has recently been proposed as the potential site for a grid-connected wind power system. Current utilisation of the technology in the country includes a demonstration 150 kW turbine, installed with assistance from the Danish Forum for Energy and Development (FED). However, unless complex load shifting control systems are included, wind energy is not likely to deliver more than about 10% of the total energy delivered by the NPC grid.

Biomass energy
Current government plans include the scaling-up of biomass energy use to contribute 30% to total energy consumption by 2015. Traditional biomass use has declined in recent years, and the potential for biomass energy use in power generation has been recognised, although currently, examination of the potential, and utilisation of the resource, are both limited. The protected status of forests and the lack of large plantations of economically useful tree crops are considered to limit the development of biomass as a significant energy source.

Biogas
The population is dispersed over the area of the island, there is no distinctive urban and rural area. Collecting manure for economically reasonable biogas generation is not reasonable and the quantity of urban waste that could be used for digestion is small. Biogas is therefore not considered a significant potential for GHG reduction.

Ocean energy
Both wave and ocean thermal resources are good, but at this time there are no commercially available systems that can be used in Niue to convert these energy sources to useable power. There are no known tidal resources developable in Niue.

Hydropower/Geothermal energy
Niue has no known potential for hydropower, possibly due to the very low geological profile of the island, whose highest point is 68 metres above sea level. In addition, the geothermal potential of the island has been assessed to be zero, with no identified geothermal resources.

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Energy efficiency

According to the energy assessment by the Pacific Islands Renewable Energy Project (PIREP), energy efficiency measures that reduce non-aviation transport fuel by 5% could be applied by 2012 and a 15% reduction in electricity use appears possible as well.

The efficient use of energy has been recognised as a goal for sustainable development by the government. Under the purview of the Support to the Energy Sector in Five Pacific Island Countries (REP-5) program, 380 efficient LPG cooking stoves were disseminated to households, in an effort to reduce the consumption of other petroleum products for cooking. In addition, an energy efficiency awareness campaign has been operating alongside the recent renewable energy installation projects, in order to inform the public as to the potential of energy efficient technologies and measures.

The REP-5 projects, implemented between 2006 and 2009, were expected to reduce the amount of diesel fuel used at the utility by 188,000 L/year, and the CO2 emissions by 437 tons/year.

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Ownership

Electricity is provided by the Niue Power Corporation (NPC), a government-owned enterprise with the sole right to generate, transmit and sell power in Niue.

The Bulk Fuel Corporation (BFC) has the exclusive authority to import petroleum products except for LPG. The BFC handles the import, storage and distribution of diesel fuel, petrol and kerosene petroleum products using New Zealand procedures and standards. Shell Fiji, Ltd. has also been supplying Niue for many years.  The BFC responds to market demands in the petroleum sector.

LPG is imported by two private companies.

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Competition

The NPC has the authority to independently conduct its operations in the sector, despite being entirely owned by the government and reporting to the Secretary for Government. The company is vertically-integrated, and holds a monopoly on the generation and distribution of electricity on the island.

The BFC is a semi-autonomous agency, and reports to the Secretary of Government. With no upstream oil industry in the island, the BFC is an integrated downstream-sector company. Local businesses are not permitted to import petroleum products for sale to the local market, this being the responsibility of the BFC, the sole operator in this area.

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Energy framework

In NIUE, energy sector development is a priority for the Government. The National Energy Policy is supportive of renewable energy and energy efficiency technologies. Niue’s current National Integrated Strategic Plan 2009-2013 also considers policies and strategies in the field of economic and sustainable development and was adopted with the environment, climate change, achieving the MDGs, and poverty alleviation measures ranking high on its priorities for sustaining a living and vibrant community on Niue. In Niue 2005 Energy Policy Document has the following subsectoral policy statements showing consistency with the country’s priorities and the project activities will build on ongoing programs, policies and political commitments:

  •      The Electricity Sector: ‘Establish and maintain an efficient, semi-autonomous and commercially orientated power corporation, the Niue Power Corporation (NPC) that is able to provide an ongoing, cost-effective, affordable, user-friendly and reliable electricity supply to meet the developing demand for electricity in its areas of service.
  •      New and Renewable Sources of Energy: ‘Promote low-carbon energy options for power generation including solar, wind and biomass energy resource; and assess and promote the natural resource potential and improve the technical capacity to meet Niue’s energy needs.
  •       Energy Conservation and Efficiency: ‘Minimize Niue's energy demand and consumption without adversely affecting Niue's economic and social well being; and maximize the efficiency with which energy is used.
  •      Private sector: To mobilize development assistance and financing from international and multilateral development partners and the private sector, for the implementation of national and regional energy strategies.


The Niue National Strategic Plan  2009-2013 (NNSP) has replaced the National Integrated Strategic Plan 2003-2008 with adapted and strengthened strategic objectives. The central purpose of the NNSP is to focus and invest on creating opportunities for everyone on Niue through financial stability, governance, economic development, social, environment and Tāoga Niue (Niue culture) development pillars, with economic growth as the identified anchor and vital for prosperity.

The NNSP remains the goal for the Energy Sector to provide reliable energy to all residents. The NNSP states that the aim is for Niue to be 100% carbon neutral within the next three years while power is generated using diesel presently. Niue is thus exploring renewable energy options to reduce reliance on fossil fuels and is considering energy efficient products such as electric cars and solar powered street lights.

The NNSP specifies four strategic areas for implementation.
1) Review and implement Niue Strategic Energy Policy and Action Plan (consistent with the  Pacific Plan, Pacific Islands Energy Policy and the outcomes of the 2007 Pacific Energy Ministers Meeting, as appropriate) for energy security to ensure:

  • Cost  effective  and  sustainable procurement and supply of fuel;
  • Efficient energy supply, including power supply and  utility management;
  • Management of demand focusing on consumption efficiency; and
  • Increased use of renewable energy and other alternative forms of energy.

2) Upgrade the underground cable system for 100% underground power distribution.
3) Place remaining High Voltage Aerial Cables underground.
4) Scheduling main overhaul for the generators.
It set the targets of grid stability of 20% renewable energy, and other forms of alternative energy to total electricity power supply increased to 20% by 2013.

Under the 9th EDF, a renewable energy/energy efficiency programme, Support to the Energy Sector in Five ACP Pacific Island Countries (REP-5), was implemented from 2006 to 2009. Through REP-5, 240 solar water heaters were supplied and grid-connected 52 kWp of solar photovoltaic systems were installed which are expected to generate 73 MWh per year, or roughly 2.4% of the current electricity consumption. Diesel fuel savings at the NPC are expected to be 18,000 L/year, which translates into a CO2 emissions reduction of 53 tons. The REP-5 energy efficiency projects supplied 380 LPG cook stoves to displace the use of electricity for cooking and implemented energy efficiency awareness campaign.

The country is a full member of the South Pacific Applied Geoscience Commission (SOPAC) since 1994.

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Energy debates

Activities set out under the National Energy Policy, for example the securing of consistent petroleum supplies, and the continued expansion of solar photovoltaic capacity, are ongoing. No amendments have been made to the National Energy Policy since its inception, however.

In addition, assessments of the Ocean Thermal Energy Conversion potential, as well as traditional wave power potential, of the island are ongoing.

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Energy studies

In 2004, Pacific Islands Renewable Energy Project (PIREP) by the Secretariat of the Pacific Regional Environment Programme (SPREP) carried out an energy assessment.

SOPAC was established in 1972 as a United Nations Development Programme Regional Project for the assessment of deep-sea minerals and hydrocarbon potential. Over the years, the work programme of SOPAC has expanded to include the assessment of ocean and onshore mineral resource potential, coastal protection and management, and geohazard assessment. Over the past decade, its mandate has broadened further to include water, wastewater, sanitation, energy and disaster risk management.

SOPAC conducted a feasibility study for the development of alternative power-generation options using renewable sources to reduce the cost of electricity generation. The result was an evaluation of the potential of wind resources in Niue. The work was greatly aided by the recent adoption of the National Energy Policy (NEP). SOPAC has recommended that Niue implement the following measures for the sustainable development of the energy sector:

  • development of clear electrification policies and guidelines;
  • popularisation of low-emission technologies and native energy sources;
  • provision of reliable energy sources on the least cost strategy; and
  • maintenance of human resource base in the energy sector.
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Role of government

There is no energy department or energy office in Niue. Currently the energy office function is party executed by the General Manager of the power utility. Project funded activities are managed by the Project Management Unit under the Premier’s Office. Of note, each government department participating in the energy sector are usually independent with no overall coordination or regulation.

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Government agencies

Whilst not directly affiliated with sustainable energy, the Niue Climate Change Project (http://www.niueclimatechange.gov.nu/) is the responsible agency for Niue's obligations under the Clean Development Mechanism (CDM), and is also involved in climate change mitigation activities, capacity building measures for the populace in terms of energy conservation.

Installation and maintenance of the island's sustainable power generation infrastructure is the purview of the NPC.

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Energy procedure

In November 2009, the European Commission approved a plan to support the government of Niue's Renewable Energy and Energy Efficiency Programme with funding of €2.55 million. The initiative aims at assisting Niue to produce more of its electricity through renewable energy sources, thus reducing the country's dependency on imported fossil fuel products. The programme is financed by the 10th European Development Fund (EDF) and is a continuation of a 9th EDF initiative. New programme activities include the upgrade of the distribution network, the further installation of RE generation, and EE actions.

The Pacific Power Association (PPA) has received funds from the EU to conduct assessments of electricity grids in the region. As part of this project, the PPA will be conducting an assessment of the Niue grid, and this will provide a valuable source of information for Activity 1 of the EDF10 project. The PPA’s assessment will be reviewed and complemented if necessary with further work. The recommendations will be taken into account and implemented where possible.

The PIGGAREP is funded by the UNDP/GEF, and managed by the Secretariat of the Pacific Regional Environment Programme (SPREP). Niue has received confirmation that it can use its PIGGAREP allocation to co-finance pre-project studies, research and awareness for renewable energy activities. The budget is US$160,000. It is anticipated that PIGGAREP activities will start in 2010, and will complement the hardware installations under EDF9 and EDF10.

The PIGGAREP has been designed to complement aid provided to NPC by New Zealand and Australia. NZAid regularly provides a budget for NPC operations, and small capital investments. The overall objective of the project in Niue is to improve the reliability and efficiency of electricity services, and reduce the current dependency on imported fossil fuels. The specific objectives are to increase the efficiency of the distribution network, increase renewable energy electricity generation, improve capacity for the implementation of renewable energy projects at the Niue Power Corporation, and continue to reduce electricity consumption in households, shops and government buildings.

The UNEP’s proposed project “PAS Low Carbon-Energy Islands - Accelerating the Use of Energy Efficient and Renewable Energy Technologies in Tuvalu, Niue and Nauru”, under the umbrella project “GEF Pacific Alliance for Sustainability” aims to remove major barriers to the widespread and cost-effective use of grid-based decentralized embedded RE supply and to the introduction of energy conservation measures.  The project is expected to be approved in December 2012 and to run for three years.

The overall goal of the project is the ‘Reduction of the participating countries’ greenhouse gas emissions by reducing fossil fuels use through renewable energy and energy conservation’. The project’s goal will be achieved by outcomes and activities geared towards the objective which is the ‘Removal of major barriers to the widespread and cost-effective use of grid-based renewable energy supply and to the introduction of energy conservation measures’. To achieve this objective, the project will build structures (i.e.; policy, institutional, market, and financing), knowledge, skills, awareness and understanding among policy makers, stakeholders and the general public in the three countries and beyond on the importance and benefits of establishing sustainable low carbon energy systems. The project will be concentrating on decentralized embedded renewable energy systems financed and maintained by the private sector (businesses and households) and also, private-public sector partnerships. This is in contrast to the current approach of focusing on utility-scale centralized RE (mostly PV) systems.
 

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Energy regulator

The NPC, in conjunction with the PWD, assume the responsibilities of the energy regulator for Niue. The NPC is responsible for the development and management of the electricity sector.

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Degree of independence

The NPC is a wholly government-owned organisation, which conducts regulatory functions as defined by the government. The NPC is headed by a General Manager, who reports directly to the government on energy issues.

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Regulatory framework

There is no comprehensive energy sector legislation for Niue. Energy activities are mainly driven by project funding or guided by the National Energy Policy. The following are a number of existing acts that govern Niue’s energy sector: the Electric Power Supply Act 1960, which governs the power utility; the Niue Transport Act 1965; the Price Control on Imported Goods for Resale in Niue Act 1975; Sales of Goods Act 1908; the Customs and Exercise Act 1966.

The Government amended the Electric Supply Act 1960 in 2008.

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Regulatory roles

The NPC is responsible for the enforcement of technical and safety standards in the energy sector, as defined by those of New Zealand. The corporation is also responsible for ensuring that the electricity tariff structure is fully reflective of the costs of electricity production, and that electricity service is provided to all consumers fairly. The NPC is also responsible for implementing demand-side management and conservation programs in the country, and ensuring that the objectives of these programs are met.

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Energy regulation role

The responsibilities of the government to the energy sector include producing the centrally-drafted energy policy, but the majority of regulation for the energy sector is the responsibility of the NPC.

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Regulatory barriers

The Pacific Islands Renewable Energy Program (PIREP) identified that the legislation establishing the Niue Power Corporation (NPC) does not appear to penalise RE, but does not encourage its use. If the government considers renewable energy to have a high priority, providing NPC with a mandate to incorporate it into its power systems would be beneficial. Such a mandate should include provision for the government to cover any added cost of investment or energy production that exceeds that found with fossil fuels. A significant weakness, largely due to the small size of the country, is the lack of institutional structures in government specifically for the regulation of NPC tariffs.

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References

SPC (2012): Niue Energy Security Indicator Profile 2009. Available at: http://www.spc.int/edd/en/download/finish/11-reports/652-niue-country-profile [Accessed 14th September 2013]

CIA (2011) The World Factbook: Niue. Available at: https://www.cia.gov/library/publications/the-world-factbook/geos/ne.html [Accessed 14th September 2013]

PIREP (2005) Pacific Regional Energy Assessment 2004 – Niue, Pacific Islands Renewable Energy Project (PIREP) National Report Volume 8, Apia: Secretariat of the Pacific Regional Environment Programme (SPREP). Available at: http://www.sprep.org/att/publication/000485_PIREP_Niue_NatRept.pdf [Accessed 14th September 2013]

REP-5 (2010) Support to the Energy Sector in Five ACP Pacific Island Countries: Niue. Available at: http://www.rep5.eu/node/46 [Accessed 14th September 2013]

GEF (2012): PAS Low Carbon-Energy Islands - Accelerating the Use of Energy Efficient and Renewable Energy Technologies in Tuvalu, Niue and Nauru. Available at: http://www.thegef.org/gef/sites/thegef.org/files/documents/document/008-08-2012%20ID4000%20Council%20document.pdf [Accessed 14th September 2013]

Government of Niue (2009) Niue National Strategic Plan 2009-2013. Available at: http://www.sprep.org/att/IRC/eCOPIES/Countries/Niue/40.pdf [Accessed 14th September 2013]

SOPAC (n.d.) Country Profile: Niue. Available at: http://ict.sopac.org/VirLib/CP0009.pdf [Accessed 14th September 2013]

Government of Niue (2008) Electric Power Supply Amendment Act 2008: An Act to amend the Electric Power Supply Act 1960, No. 295. Available at: http://www.gov.nu/wb/media/Act%20295%20Electric%20Power%20Supply%20Amendment%20Act%202008.pdf [Accessed 14th September 2013] Close References