Energy Transition Project

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The RMI consists of 29 atolls and five islands in the North Pacific with an average altitude above sea level of about 2 meters. The Marshall Islands depends heavily on external assistance, with an average 60% of gross domestic product being provided through annual grants - the most significant being the Compact of Free Association (COFA) with the United States that has recently been renewed for the period 2024-2043. The Marshalls Energy Company (MEC) is a state-owned utility and is responsible for fuel imports into the Marshall Islands. It also generates, distributes, and retails electricity on Majuro to a population of about 28,000 (about half of the total country's population) and over 70% of the electricity generated and consumed in the country. Also, MEC provides fuel and electricity supply in a few islands outside Majuro. ADB's ongoing assistance in the energy sector in RMI covers interventions for the rehabilitation of the Majuro tank farm as well as for installation of new meters. ADB is supporting the government and MEC implement a multi-year management action plan to improve MEC's corporate performance. This is currently underway through a three-year Supplemental Management and Operations assistance (commenced in 2023) on policy, commercial, technical, regulatory and human resource aspects of the power system in Majuro as well as preparing priority investments for efficiency and reliability. The proposed project will support energy distribution systems in Majuro city, low carbon renewable energy installations in the RMI and sector reforms, institutional strengthening as well as resilience on smaller islands.