Access and Renewable Increase for Sustainable Energy Project

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The proposed Project will contribute to the achievement of the GoFSM’s energy sector goals by expanding (providing new or improved) access to electricity service, increasing renewable energy generation, and enhancing capacity of energy related entities in the four states of FSM. The Project will fund construction of mini grids, rehabilitation (including resilience enhancement) of distribution networks, integration of solar PV systems, technical assistance, and capacity strengthening. The Project activities are grouped into three components. The Component 1 - Electricity Service Expansion will (i) increase the electricity access rate in Chuuk; (ii) improve the reliability of power supply while enhancing resilience to climate & natural hazards and reducing technical losses in Pohnpei, Yap and Kosrae; and (iii) facilitate preventive grid maintenance for the four power utilities. The Component comprises four subcomponents. Sub-Component 1.1 (Chuuk Islands Electrification) will fund detailed studies, designs, supply, construction, supervision, and commissioning of solar-powered mini grids and stand-alone solar home systems in selected four unelectrified islands of Chuuk. Sub-Component 1.2 (Pohnpei Grid Upgrade) will fund improve the automation, protection, resilience of the distribution grid in Pohnpei main island, provide trucks for preventive maintenance, and enable completion of the rehabilitation of the Nanpohnmal Power Plant. Sub-component 1.3 (Yap Grid Resilience) will fund detailed designs, supply, supervision, and installation of three underground distribution feeders to provide redundant and more reliable power to critical facilities—such as the Airport, hospital, water plant facilities, radio station, selected Government buildings and the commercial center— in Yap main island. Sub-component 1.4 (Kosrae Grid Rehabilitation) will rehabilitate segments of the distribution network, enable battery energy storage and facilitate preventive maintenance in Kosrae main island. The Component 2 - Renewable Energy Generation will increase solar energy generation with storage and grid stability controls in Chuuk, and Pohnpei to reduce diesel generation costs and help achieve GHG emission reduction targets. The component comprises two sub-components. Subcomponent 2.1 (Pohnpei Solar Energy Generation) will fund detailed studies, designs, supply, installation, commissioning, and supervision of about grid-connected solar PV systems in the Pohnpei main grid. Subcomponent 2.2 (Chuuk Solar Energy Generation) will fund similar detailed designs, supply, installation, commissioning, and supervision of about 1.5 MW of grid-connected solar PV systems with 2 MWh of battery storage in the Chuuk’s Weno grid and ensure grid stability. Component 3 - Institutional Strengthening and Implementation Support aims to strengthen the capacity of key energy sector entities such as DoR&D, state power utilities, and the project implementation unit (PIU). It consists of three sub-components. Subcomponent 3.1 (Sector Development Assistance) will help strengthen key energy sector areas such as adoption of cost reflective electricity tariffs, regulatory capacity building, energy efficiency policy, and outer island electrification. Subcomponent 3.2 (State Power Utility Capacity Strengthening) will seek to enhance the capacity of the four state power utilities on operation and maintenance of renewable energy technologies and distribution networks through a combination of an apprenticeship program that promotes women's employment, international technical expertise, and maintenance fund development. Subcomponent 3.3 (Project Implementation Support) will provide adequate resources to the DoR&D’s PIU to execute the project with support from the Central Implementation Unit on procurement, financial management, and environmental and social aspects.