Fiji’s energy situation is characterized primarily by high reliance on imported fuels. Therefore, the Government is committed to reduce the reliance on imported fossil fuels by incentivizing energy generation through renewable energy sources in the country.
In Fiji, some of the major sources of energy generation are:
• Hydro, which caters for a significant demand of electricity needs
• Imported fossil fuels and
• Biomass including fuel wood and crop residues for cooking and industrial residues for power cogeneration in the timber and sugar industries.
The transport industry is the largest consumer of energy, taking up an estimated 40 percent of total energy supply, followed by the commercial, industrial and domestic sectors.
High reliance on imported fossil fuels remain a central issue for the energy sector. The potential impact on Fiji’s economy through high and volatile fuel prices and high import payments is significant, thus the need to reduce reliance on imported fuels and safeguard foreign reserves is considered key in ensuring economic stability. This provides a natural drive for Fiji to find alternative energy sources in the form of renewable and indigenous fuels for both electricity production and transport services. Any business setting up Electric Vehicle Charging Stations shall be exempt from tax for a period of 7 yrs provided the minimum capital expenditure is FJD $100,000, granted a maximum 5% subsidy on capital outlay.
Due to the Fijian Government’s significant investment in rural electrification initiatives over the last two decades, the majority of the population are connected to the national electricity grid. However approximately 4% of the total population is still without proper electricity supply to connect the rural population to the national grid in a sustainable manner. In addition, where electricity supply is available, issues of affordability or inequalities within communities may prevent people from maximising the benefits of modern energy supplies.
Access to electricity and share of renewable energy sources in electricity generation have increased significantly in the last 10 years. Fiji’s most recent census shows that 96% of the population have access to electricity, with at least 90 per cent of the population connected to the national grid. Currently, 45 percent of the country’s power needs are supplied through fossil fuels, 50 percent through hydropower and the remaining five percent from biomass and wind.
- Availability of untapped renewable energy resources such as hydro, wind, biomass, solar, and geothermal which could be used for power generation
- Readily available standards, guidelines and codes of practice for renewable energy and well established suitable renewable energy information systems.
- Reduced duty, tax and excise incentives for renewable energy efficient equipment.
- Fiji’s demand for energy has been increasing.
- 4% of the total population is still without proper access to electricity.
- Fijian Government provides an enabling environment for private sector participation in the electricity sector.
- There are opportunities for replacing fossil fuels used in land transport through expanding the use of biofuels, hybrid and electric vehicles.
- Potential to reduce fossil fuel consumption in maritime transport through use of renewable energies (biofuel, solar and wind) and improved efficiency of vessels and engines.
- Opportunities for the private sector to invest in small-scale renewable energy systems.
- 5-year tax holiday is available to a taxpayer undertaking a new activity in renewable energy projects and power cogeneration.
- Duty free importation of renewable energy goods is also available.