Rt-p ti No-) i lit, 'VSt)

Western Samoa: Issues and Optionsin the Energy Sector

Jurn 19J85

Report of the joint UNDPJWorld Bank Energy Sector Assessment ProgramThis document has a restricted distribution. Its contents may not be disclosedwithout authorization from the Government, the UNDP or the World Bank.

_ _ _ B _~~~~~~____ S S .. _____

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

JOINT UNDPIWORLD BAMK EhNERGY SECTOR ASSESSMENT PROCRAflREPORTS ALREADY ISSUED

Counr rv DaLe Number

Indcnes 3 a N.cg;embe- 1981 35'3-INDMaluriLius )December 3 3510-MASKenva MaJy 1982 380-KESri Lanka :982 3. 792-CEZ . ne 19AK7 37 6 6 Z 1ZM

i.c 1932uad-- f. -- o r '98-

-a, a - r. ' j

,__ ,, _A S, _", ' "'' -- -

in ~ ~ ~ ~ ~ ~ ~~~~-n

S - . . : . .-: 2 S: .~~~oc -

;,; .... _ . -. ................ J w \ t : S

: ., :.,: . . . y . % G . ,. o J _ . _~

;; ; _ ' ~~~~~~~~~~~~~~~~~ s ' ~~~~~~~~~~ ~~~~; ..., .a;~~~~~~~~~~~~~~~~~~-

:---: .u -u: ;2~-Z< '- -E

:~~~~~~~~ ~ -. - 5 r:; ~L_;:

FOR OFFICIAL USE ONLYReport No. 5497-WSO

WESTERN SAMOA

ISSUES AhD OPTIONS IN THE ENERGY SECTOR

JUNE 1985

This is one of a series of reports of the Joint UNDP/World Bank EnergySector Assessment Program. Finance for this work has been provided, inpart, by the UNDP Energy Account, and the work has been carried out bythe World Bank. This report has a restricted distribution. Its contentsmay not be disclosed without authorization from the Government, the UNDPor the World Bank.

ABSTRACT

Western Samoa has suffered in recent years from economic diffi-culties caused by declining world prices for its main exports of copraand cocoa and fluctuating prices for essential imports such as petroleumproducts. Notwithstanding decreased demand for petroleum products duringthe period, the costs of imports have not changed much. The main energyissues for the immediate future concern minimizing petroleum productimport costs and continuing the economic substitution of indigenousenergy resources for imported petroleum fuels. The report recommends(a) evaluation of alternative arrangements for procuring petroleumproducts; (b) an integrated analysis of power system planning andoperations; and (c) provisisn of technical expertise to monitor proposedbiomass gasification pilot projects.

ABBREVIATIONS

ADB Asian De-zelopment BankADO Automotive Diesel OilCHOGRM Commonwealth Heads of Government

Regional MeetingEDF European Development FundEEC European Economic CommunityEPC Electric Power CorporationESCAP Economic and Social Committee

for Asia and the PacificGOWS Government of Western SamoaPEDP Pacific Energy Development ProgramSFP Samoa Forest Products CorporationSPC South Pacific ConferenceSPEC South Pacific Bureau for Economic

Co-operationWESTEC Western Samoa Trust EstatesWFPS Wood-Fired Power Station

CURRENCY EQUIVALENTS a/

NZ$1.0 = WS$1.06US$1.0 = WS$1.59NZ$1.0 = US$0.66

MEASUREMENTS

Bbl. Barrel = 158 liters; 42 US gallons;boe Barrel of oil equivalent = 6 million Btu.BTU (Btu) British thermal unit = 0.252 kilocaloriesCWh gigawatt hour = million kilowatt hourskJ kilojoulekm kilometer = 1,000 meterskW kilowatt = 1,000 wattskWh kilowatt hour = 1,000 watt hoursm 3 cubic meterMW megawattp.a. per annumTOE (toe) tonne of oil equivalenttonne metric tonTpa (tpa) tonnes per annum

a/ The value of the Western Samoa Tala (WS$) in terms of the NewZealand dollar (NZ$) is determined by reference to a basket ofcurrencies. The above reflect exchange rates for October 1983.

ENERGY CONVERSION FACTORS

TOE Per Physical Unit 1/

Liquid Fuel (tonnes) 2/

Avgas 1.04LPG 1.08Gasoline 1.05Kerosene/Turbo Fuel 1.03Diesel Oil (ADO) 1.02

Electricity (MWh) 3/ 0.25

Biomas Fuels (tonnes)

Firewood 0.33-0.35Coconut Palm Wood 0.27Coconut Husk and Shell 0.44

(73% husk, 27% shell)

1/ 1 TOE = 10 million- 6.61 boe= 39.68 million Btu

21 Avgas = 1413.6 liters/tonneLPG = 1729.1 " oGasoline (Motor Spirit) = 1356.8 "Kerosene/Avtur = 1229.1 "

Diesel (ADO) = 1186.5 "

3/ Converted at thermal efficiency of 34% or 4 MWh per toe.

This report is based on the findings of an energy assessment missionwhich visited Western Samoa in April 1984. The mission members wereN.B. Prasad (Mission Leader), Maria Kiwana (Energy Planner), JakobDiddens (Power Economist -- Consultant), and -Zahid Khan (BiomassGasification -- Consultant). The mission benefited from discussions withstaff of the South Pacific Bureau for Economic Co-operation (SPEC) andthe United Nations Pacific Energy Development Programme (UNPEDP).Assistance was provided by Mr. B. Chronowski in reviewing technicalinformation on wood-fired steam power generation. The report wasdiscussed with the Government in May 1985.

TABLE OF CONTENTS

SUMMARY . ................................................... i

I * ENERGY AND THE ECONOMY ...................................... 1Country Economic Situation ................. 1

Petroleum Import Costs ................................. 2Energy Balance Projections . . 3

II. EIERGY SECTOR OVERVIEW .. ... SEnergy Resources . . . 5Introduction ... 5Natural Forest ... 5

Petroleum ................................................ 8Historical Demand ................ .. . 8Petroleum Demand Projections . . . 9Petroleum Pricing . . . 11

Electricity .............................................. 12Supply ................................................. 12Demand ................................................. 13Power Load Forecast . . . 14

Biomass .................................................. 16Biomass Supply and Demand Projections . . . 18

III. ISSUES AND OPTIONS ....................... 20Introduction ........................ 20

Petroleum Supply Arrangements . . 20Upolu Power System ....................................... 22Upolu Capacity Constraints . . 22Upolu System Expansion Options . . 25Wood-fired Steam Plant ................................. 25Afiamalu Pumped-Storage Scheme . . 27Afulilo-Fugaloa Hydro Scheme . . 29Conclusion ............................................. 29

Savaii Power System Expansion . . 30Electricity Pricing ...................................... 32Introduction ........................................... 32Tariffs .............................................. 33

Other Renewable Energy Options . . 34Hot-air Generators ..................................... 34Biomass Gasification for Power Generation .............. 35Coconut Oil for Power Generation ....................... 36Charcoal Exports ....................................... 37

The Role of Solar Energy ................................. 37

IV. ENERGY INSTITUTIONS AND TECHNICAL ASSISTANCE ............... 39Energy Planning and Administration ..................... 39Electric Power ....................... 39Forestry ....................... 39Other Responsibilities ................. = ............... 40Implications for External Assistance ................... 40

ANNEXES

1. Energy Balance Projections, 1990 ........................... 412. Energy Balance Projections, 1995 .423. EPC Generating Plant in Service .434. Upolu: Expected Hydrogeneration Capability .445. Upolu: Load Forecasts (1984-2000) .456. Savaii: Load Forecasts (1984-2000) .467. Specifications of Brugger Copra Drer .478. Ongoing Technical- Assistance Activities. .489. Priority Technical Assistance Requirements .50

TABLES

I Priority Action Programme .vii1.1 Balance of Trade (1980-1983) ............................. 11.2 Cost of Petroleum Product Imports (1980-1983) ............ 21.3 Energy Balance, 1983 ..................................... 42.1 Age Distribution of Coconut Trees ........................ 72.2 Petroleum Product Sales (1980-1983) ...................... 82.3 Sectoral Consumption of Petroleum Products, 1983 ......... 92.4 Petroleum Product Demand Projections (1983-1995),

Base Scenario .102.5 Petroleum Product Demand Projections (1983-1995),

Contingency Scenario .102.6 Petroleum Product Pricing Structure, November 1981 ....... 122.7 EPC -- Power Supply/Demand Statistics, 1983 .............. 132.8 EPC -- Power Generation and Sales (1977-1983) ............ 142.9 Upolu Load Growth Forecasts (1983-2000) .................. 152.10 Savaii Load Growth Forecasts (1983-2000) ................. 162.11 Biomass Demand Estimates, 1983 ........................... 172.12 Biomass Supply/Demand Projections (1983-1995) ............ 193.1 EPC Hydro Capability ..................................... 233.2 Upolu Power System Demand and Supply (1984-2000) ......... 243.3 Wood-Fired Power Generation Costs ........................ 273.4 EPC -- Diesel Fuel Costs and Average Revenues (1972-1984) 333.5 Estimnted EPC Average Cost of Production, 1983 ........... 343.6 Monthly Insolation Values ................................ 38

MAPS

Energy Resources (IBRD No. 18656)

SuMrY OF MAJOR FINDINS MND RsECOHHENTIONS

Introduction

1. Western Samoa's performance in the energy sector has been re-markably good in recent years despite its complete reliance on importsfor petroleum requirements and its narrow resource base (hydro and bio-mass). The main issues for the immediate future concern minimizingpetroleum imports costs, and encouraging continued economic substitutionof indigenous energy resources for imported fuels. Little additionalhelp is needed in the area of demand management since Western Samoa isalready receiving external assistance in this area (Annex 8). Withrelatively little additional expenditure, most of the major issuesidentified in this report can be handled in the short-term by varioustypes of pre-investment work and technical assistance.

Energy Demand

2. Between 1978 and 1982, Western Samoa's GDP declined by 5X ayear, -- largely because of declining productivity in agriculture, themajor sector, compounded by a sharp reduction in the prices of the majorexports of copra and cocoa. At the same time import prices increased,resulting in a deterioration of the terms of trade and balance ofpayments difficulties. In early 1983, GOWS adopted a stabilizationprogram aimed at achieving short-term balance of payments viability andalready has succeeded in reversing the decline in real output (paras.1.2-1.5).

3. The mission has assumed a GDP growth rate of 4% p.a. in itsenergy demand projections. Although this may prove to be optimistic, itis regarded as a useful basis for establishing upper limits for energydemand forecasts. Considering that automotive dierel oil (ADO) will beincreasingly displaced by indigenous hydro and biomass sources, petroleumdemand is expected to register an average increase of 2.42 p.a. On theother hand -- due to increased demand for power generation and processheat requirements -- biomass fuel demand is expected to grow at 3% p.a.compared to net population growth of 1Z p.a.

Petroleum

4. Western Samoa, like its island neighbors, depends entirely onimports to satisfy its petroleum requirements. Although the petroleumbill is currently only 11% of total imports, it is likely to increase asthe economy recovers, and GOWS is concerned that a substantial portion ofits export earnings (ranging from 31% to 87% in recent years) has beenrequired to pay this bill (para. 1.6).

- ii -

5. COWS follows a sound practice of passing on all petroleum pro-duct costs to the consumer and has already taken the step of consolidat-ing Western Samoa's national petroleum requirements into one bid in aneffort to attract competitive supply offers. However, the scope forreplacing petroleum with indigenous energy sources is mostly confined tothe power sector, which accounted for 22Z of petroleum consumption in1983. Consequently, the main potential for reducing the cost of petrol-eum imports lies in the procurement and supply arrangements. As in mostof the other South Pacific Islands, COWS currently lacks the full capabi-lity to evaluate the various cost components of petroleum imports (para.2.15). Therefore, the misssion recommends a study be undertaken toevaluate the feasibility of lowering the cost of petroleum supplies forthe South Pacific Island countries, including Western Samoa(para. 3.3-3.6).

Electricity

6. The national electric power supply system is operated by theElectric Power Corporation (EPC). EPC is a well managed utility thatprovides a reliable power supply and is aware of its staff training needsand the importance of power development planning. Periodic support inthese two functions could be desirable, partly to relieve operationalmanagers from the task. Modification of the Board to increase the numberof private sector individuals who could contribute to the management ofEPC would also be beneficial (paras. 4.2-4.3).

7. The system consists of a fairly extensive hydro/diesel gridnetwork on Upolu with an installed capacity of 14.4 MW, and a smallerdiesel-based power system at Salelologa in southern Savaii (installedcapacity of 0.4 MW). Since 1982, EPC also distributes electric power innorthern Savaii, which is generated by excess process steam from a woodwaste-fired boiler that is fed to a 2.5 MW steam turbo-generator owned bySamoa Forest Products Sawmill (SFP). Most of the public power supply(972) is generated on Upolu (paras. 2.18-2.21). The major issues in thepower sector relate to: (a) improvement of present generation facilitieson Upolu; (b) efficient substitution of indigenous energy sources forimported ADO in future power generation capacity; and (c) the adequacy ofpresent electricity tariff levels. These catagories are interrelated;for example: improved diesel operations could increase effectivecapacity; equally, power utility revenue requirements for capitalinvestments could have an impact on tariff levels. Therefore, themission recommends that technical assistance be provided to assist EPC incarrying out an integrated power system operation and planning study thatwould incorporate the issues discussed below in paras. 8-17. Preliminaryterms of reference are provided in Annex 9.

- iii -

Upolu Generation Constraints

8. Installed diesel capacit) un Upolu is 9.8 MW. However, EPC hashad difficulty with maintenance due to the unavailability of spareparts. Several engines cannot bc used fo'- cor.tinuous operation at fullload, and EPC has subsequently had to de.ate its diesel capacity by 30%to 6.9 NW. The mission supports EPC's request to SPEC for technicalassistance to determine the feasibility of increasing the effectivecapacity of existing Upolu dipsel sets (para. 3.8).

9. Hydro capacity on Upolu is 4.6 MW. However, the existing hydroplants are run-of-the-river and are characterized by (a) minimal storagecapacity; and (b) irregular rainfall patternz on both a monthly and dailybasis. This results in a highly variable hydro output, especially in thedry season. Therefore EPC cannot count on more than 1.8 MW of hydrocapacity for planning purposes. In view of EPC's desire to phase-out iLsdiesel capacity the mission recommends that EPC continue its investiga-tions into the possibility of increasing system storage capability(paras. 3.9-3.11).

Upolu System Expansion

10. Currently EPC is considering three different indigenous energ,-based generation options as alternatives for increased diesel capacity.The three options are (a) a wood-fired steam power station which is inthe final design stage (5 MW capacity); (b) the Fagaioa-Afulilo hydroplant (10 MW capacity); and (c) the Afiamalu pumped-storage scheme (5 MWcapacity). All three options have had preliminary evaluat.ons againstADO-fired generation capacity. However, the options are ail relativelylarge compared to present system capacity and involve significantinvestment requirements. Therefore, the mission considers that theseprojects can only be fully evaluated in the context of a least-costsystem expansion strategy. Important factors to be coisidered includethe expected reliability of power supply; the relative risks of notmeeting load requirements or of surplus capacity; and tnc cost of anysuch short-term adjustments that might become necessa:-y (paras. 3.12;3.25-3.27).

11. Wood-fired steam power stations (WFPS) cost more than equiva-lent ADO-fixed capacity in terms of both capital outlay requirements andoperating and maintenance costs. Thererore, several factors must beconsidered if the WFPS is to contribute to a reduction in powergeneration costs as well as reduce dependence on imported ADO: (a) areliable supply of low-cost fuelwood should be available throughout theproject-cycle; (b) the WFPS should operate at a reLatively high loadfactor; (c) sizing and configuration of the plant should ensure maximumfirm capacity; and (d) procurement procedures should continue toemphasize minimum required capital investment outlays. The missionsuggests that the issues of biomass fuel availability, accessibility,harvesting and transport logistics and subsequent implications for thedelivered cost of a reliable supply of fuelwood should be fully

- iv -

resolved. Coalsideration should also be given to optimizing procurementprocedures and plant cLnfiguraEion. The mission recommends thattechnical assistance be provided to EPC to invetigate the long-run costof WFPS power production within the context of a least-cost power systemexpansion study (paras. 3.14-3.17).

12. The Fagaloa-Afulilo hydro scheme. as conceived at present.appears too costly. B ins a seasonal storage projcct, it has importantimplications tor firming up the cApacitf ot existing runi-of-river hydrostations whilr contributing additional energy generation. Therefore,alternat ve contigurations ot this project should be further assessed asa component of the proposed least-cost power expansion study.

13. The Afiamalu pump-assisted hydro storage scheme involvespumping water from the head reaches of a river about 200 meters up to anartificially-lined hilltop reservoir to gain a drop of 700 meterJ on theother side of the hill. Apart from the geological problems posed by aporous reservoir base, a detailed economic evaluation of this type ofproject requires a thorough understandinR of its hydrology and powersystem operation. Factors to be addressed include the duration andtiming of the p.mping periods. source of energy for pumping and operationof the po--- station to derive optimum benefits for the system. Such anevaluation should form part of an overall least-cost system expansionstudy based on ongoing investigations (paras. 3.18-3.21).

Savaii Svstem Expansio.i

14. The Asau sawmill operated by Samoa Forest Products Corp. (SFP)on behalf of COWS has a 2.5 MW turbo generator which produces electricpower utilizing excess steam from a waste-fired boil.!r. Electric powersurplu3 to the mill's requirements is distributed by SFP to consumers inAsau Village and by EPC to northwest Savaii. A UNDP-financed scheme forrural electrification is currently underway 'o extend transmission linesfrom the Asau complex to the EPC power system, thus integrating the twoSavai; power syLtems (parA. 3.28).

15. However, the Asau power generation facility is an ineff;cientoperation th-at is trequently shut down due to lack of timber waste fueland/or mechanical failure. It is imperative the reliability of both thesawmil and its associated power generation fAcility as a source ofpub'ic power supply be evaluated before any further system integrationwork is begun (paras. 3.2B-3.32). Therefore the mission recommends thattechnical assistance be provided to GOWS for this purpose, as a componentof the power system analysis discussed in para. X above (Annex 9).

Electricity Tariffs

16. The main concern regarding electricity tariffs is the averagerevenue level as it affects EPC's financial position and its capabilityto make a reasonable contribution from internally generated funds towardsthe cost of future system expansion. Tariff increases have lagged very

significantly behind the cost of electricity production. The result isthat EPC's financial sittiation is far from healthy at this time. Themission recommends that EPC be allowed to pass on to the final consumerall such increases in the cost of power supply as rapidly as possible.(paras. 3.34-3.35, Table 3.4).

17. In view of EPC's load forecasts and long-term projections ofca-ptal investment requirements, the mission recommends that COWs con-sider a tariff revision that would allow EPC to cover its costs of opera-tion and to make a reasonable contribution to its capital requirements.Technical assistance is proposed to assist EPC in carrying out an analy-sis of its present and expected cost structure and financial requirementsbased on the least-cost power system expansion strategy (para. 3.36).

Other Renewable Energy Options

18. There are several other ongoing activities in the renewableenergy sector. The mission's assessment of some of these programsfollows:

19. Hot-Air Generators. Western Samoa has been particularlyinnovative in that there is already in production a local version of hot-air generator that utilizes agricultural residues (instead of petroleum)for crop drying (Annex 7). Perceived benefits include less biomass fuelrequirements and better quality dried product than is feasible with thetraditional open-fire "smoke-dry" method. Gasifiers/burners, a similarsystem, can be retrofitted directly onto existing boilers and dryers.However, Western Samoa has little experience in the retrofitting ofboilers. Therefore the mission supports the CHOGRM-financed demon-stration project which involves the retrofitting of diesel-fired boilersat three sites in Apia which will include installation and testing of thegasifier/burners, training, and dissemination of information (paras.3.37-3.39).

20. Biomass Gasification for Power Generation. An EEC-financedpilot project to be operated by EPC is to demonstrate the feasibility ofbiomass gasification as a source of rural power generation in the Pacificregion. The project is to consist of a 600 kW gasifier/diesel systemutiliziag coconut husk and/or shell &3 the fuel feedstock to produce gasto power the diesel engines. In view of the disappointing performancerecord of gasifier systems much larger than 200 kW, the mission advisedthat a maximum system capacity size of 200-300 kW would be moreappropriate for the stated project objectives of demonstrating andevaluating equipment reliability and availability. Further, coconutshells and husks as an alternative feedstock for gasifiers are still inthe experimental stage. In view of Le significant investment outlayinvolved, the mission recommends that sufficient manpower and operationalexpertise be made available to assist EPC in cperating and monitoring thepilot project (paras. 3.40-3.41).

21. Solar Energy. Although solar energy's main applications arecurrently confined to water-heating and rural lighting and communica-tions, the mission believes there is a long-term possibility that solarphotovoltaics could produce electricity at a price competitive withpetroleum generation and that does not invoLve the use of scarce landresources. The mission recommends that GOWS monitor the performance ofpilot PV systems to be installed in other Pacific countries under the EECRegional Programme (paras. 3.46-3.50).

22. Coconut Oil. EPC has held a six-mcnth trial using coconut oilas a substitute for diesel in engine operation and expects to carry outfurther trials. In view of EPC's other committments requiring skilledmanpower and the alternative uses for coconut oil, the mission believesthat this program should be given a low priority at present, limited tokeeping abreast with similar work in the region and participating inCHOGRM's workshop to review developments with coconut oil fuels scheduledfor mid-1985 (paras. 3.42-3.43).

23. Charcoal/Carbon Export. As regards WESTEC's proposal forproduction of export-targeted coconut shell-based charcoal and activatedcarbon, the mission considers that world prices for these products areneither high enough nor steady enough to justify such a project atpresent (paras. 3.44-3.45).

Implications for External Assistance

24. While substantial amounts of technical assistance have beenoffered recently to Western Samoa, the mission considers that the highestpriority should be given to the following three areas: (a) A least-costpetroleum supply strategy; (b) an integrated power sector study; and(c) ensuring expert operation and monitoring of biomass gasificationpilot projects. Total costs of this technical assistance are roughlyestimated at US$315,000. Further details are provided in Annex 9 andsummarized below in Table 1. GOWS has recently appointed an EnergyPlanner and the mission recommends that the main task of this planner, inthe first instance, should be to supervise these technical assistanceactivities (para. 4.1). With a relecively small expenditure, theseactivities could liake a substantial contribution to the energy situationand prospects in Western Samoa.

25. The main energy sector capital requirement so far appears to befor a 5 MW wood-fired power station estimated to cost about US$11.0million. This project is to be financed by the government of NewZealand, Kuwait and Saudi Arabia. Other energy investment requirementsover the next decade will be determined after completion of the technicalassistance proposals concerning the selection and scheduling of powercapacity expansion options.

- vii -

Table 1: PRIORITY ACTION PROGRAM4ME

Estimated Cost

(US$)Petroleum 85,000 a/

Development of a regional least-coststrategy for supplying and distributingpetroleum products in the SouthPacific Island countries.

Power 200,000

(i) Improvement of present generation facilitiesthrough overhaul of thermal capacity

(ii) Least-cost power development program

(iii) Tariff review and modification

Biomass Gasification 30,000

Provision of expert assistance forimplementation and operation of(a) a boiler retrofit program; and(b) biomass gasification for ruralelectrification project.

a/ This study is to be financed and executed by the joint UNDP/WorldBank Energy Sector Management Assistance Programme (ESMAP).

I. ENEGY AND TUE ECONOMY

Country Economic Situj- :on

1.1 Western Samoa is situated northeast of Fiji and just east ofthi International Dateline. It comprises two main islands, Upolu (1,100Km ), Savaii (1,820 Km2), and five smaller islands. The main islands aremountainous and mostly covered with dense natural vegetation. The 1983total population was estimated at about 159,000, 73% of which live onUpolu, and the remaining 27% on Savaii. The capital city, Apia, islocated on Upolu, and has an estimated population of 35,000. The rest ofthe populace lives mainly in small scattered villages. Net populationgrowth is about 1% p.a. due to substantial emigration, mostly to NewZealand.

1.2 The economy is based on subsistence village-orientated agricul-ture (accounting for 66% of the labour force). Preliminary estimatesindicate 1982 GDP per capita of US$540. The agricultural sectorincluding forestry and fisheries is believed to account for more than 50%of GDP; and 80-90% of exports. The manufacturing sector is small (6% oflabour force, and 5% of GDP) and involves timber-milling, brewing andfood processing aimed at import substitution.

1.3 Between 1978-1982, despite substantial development assistanceWestern Samoa's economy performed well below its potential. Real GDPdeclined by an average rate of -5% p.a., mostly due to depressedconditions in the agricultural sector which, accounts for half of totaloutput. The production of the two major crops, copra and cocoa, wasconstrained by the old age of most trees which, in conjunction withsometimes adverse weather conditions, resulted in sharp fluctuations inoutput from year to year. Export prices of copra and cocoa (the two mainexports) declined sharply during this period while import prices roseresulting in deteriorating terms of trade. Consequently, notwithstandinga significant drop in import volumes, the balance of trade deficit wasestimated at WS$45.0 million in 1982.

Table 1.1: BALANCE OF TRADE, 1980-1983(WSS million)

1980 1981 1982 1983 a

Exports f.o.b. 16.0 12.2 16.2 26.8

of which: Copra and products 8.3 4.5 7.2 12.5Cocoa 2.9 1.4 0.8 3.9

Imports c.i.f. (56.6) i61.3) (61.2) (77.2)

Trade Balance (40.6) (49.1) (45.O) (50.4)

a/ Estimate.

Source: IW Estimates.

- 2 -

1.4 To deal with the economic crisis, COWS adopted a stabilizationprogram 1/ in February 1983 aimed at reducing the current accountdeficit, halting the decline in real output, and reducing public sectoractivity. As a result, 1983 GDP was estimated to have grown by about 1%in real terms, mainly attributable to the strong performance of exportsof goods and services, and expansion of the manufacturing sector.

1.5 GOWS has developed a number of strategies aimed at raising theGDP growth rate. These include: (a) rectifying internal and externalfinancial imbalances through export promotion, import control and publicexpenditure controls; and (b) strengthening the productive base of theeconomy through more efficient use of village agricultural lands;encouraging agro-processing activities and developing indigenous energyresources. For projecting future maximum levels of energy demand through1995, the mission agreed with COWS to use a GDP growth rate of 4% p.a.

Petroleu'u import Cost

1.6 COWS is concerned about the country's oil import bill *in viewof fluctuating world prices for Western Samoa's main exports of copra andcocoa (Table 1.2). There is the possibility of minimizing Ehe cost ofpetroleum imports through alternative procurement arrangements (para.3.4-3.7). In addition, substitution by indigenous biomass and hydroresources in the power and industrial sectors is already underway (para.2.28). Since there currently is no economic substitute for transportpetroleum requirements which account for 65% of petroleum imports, thereis only limited scope for reducing petroleum imports.

Table 1.2: COST OF P_TROLEUM PRODUCT IWPORTS(10 WSS)

1980 1981 1982 1983

Total Petroleum Imports 7.9 10.6 6.9 8.5

(i) Petroleum imports % ofmerchandise imports 14 17 11 11

(ii) Petroleum as % ofmerchandise exports 50 87 43 31

Source: IW Staff estimates.

1.7 The energy balance for 1983 presented in Table 1.3 must beconsidered approximate only and should be further refined as the database improves. However, it serves to illustrate the dominant role of

1/ This included a standby Arrangement with the IMF for WS$8.0 million.

- 3 -

biomass fuels (wood and agricultural residues) which accounted for about77% of final energy consumption. 1983 per capita net consumption wasestimated at 0.51 toe, which was average compared to some other PacificIsland countries. 2/ However, since estimates of biomass supply are muchless reliable than those of commercial energy, 3/ their contribution mayhave been understated. For instance, the Asaui sawmill on Savaii consumessignificant (though unspecified) amounts of biomass waste for processheat and power generation purposes.

1.8 Primary commercial energy supplies in 1983 amounEed to 24.88thousand toe. 4/ Imported petroleum accounted for 21.85 thousand toe,while hydro-power accounted for the remaining 3.03 thousand toe. Thetransport sector accounted for the major part of petroleum cons,unption(65%), followed by power generation (23X).

Energy Balance Projections

1.9 In the mission's view, although there is a good chance for sub-stantial petroleum displacement in the power sector, Western Samoa willcontinue to rely on imported petroleum for its transport needs in theforeseeable future. The implications are that there will be increasingdemand for: (a) retroleum, as the economy recovers and transport demandincreases; and (b) biomass fuel due to continuing displacement ofpetroleum in the power and industrial sectors.

1.10 The mission has attempted supply/demand energy projections forWestern Samoa based on GDP growth of 4% p.a. These projections aretentative and should serve only as an indication of maximum energy demandthrough 1995. The following assumptions are made: (a) net populationgrowth will continue at the present rate of 1% p.a.; (b) currentprogrammes for reafforestation and coconut replanting will proceed onschedule; (c) hydro and biomass in the form of senile coconut trees andfuelwood from a dedicated energy plantation will significantly displacediesel generation by 1995; (d) EPC's power sales will grow at 5% p.a.;(e) the transport sector will grow at the same rate as GDP (4Z p.a.); and(f) the future decrease in copra drying requirements -- due to more wide-spread use of efficient drying methods - will be offset by increased useof biomass in the industrial sector.

2/ For example, Solomon Islands 0.44 toe (1982) and Vanuatu 0.53 toe(1983).

3/ Defined here as petroleum products and electricity.

4/ Although some biomass is traded commercially, biomass is omittedfrom commercial energy estimates in accordance with convention andto facilitate inter-country comparisons.

-4-

1.11 The energy balance projections for 1990 and 1995 given inAnnexes 1 and 2 show that gross domestic energy consumption increasesfrom 87,850 toe in 1983 to 110,430 toe in 1990, and to 124,190 toe in1995. Net domestic consumption increases from 13,760 toe in 1983 to91,130 toe in 1990, and 98,970 toe in 1995. A major part of the averagegross energy increase (2.9% p.a.) is accounted for by the fact that con-version of biomass into electric power is not as efficient as that ofhydro or petroleum. Consequently, average net energy consumption growthis substantially less (1.6% p.a.).

Table 1.3: ENERGY BALANCE, 1983

('000 toe)

Fuel- Agric. Total Electri- Petro- Total

wood a/ Residues biomass Hydro city leum Ener,y

Primary Supplies

Production 24.60 38.39 62.99 3.03 - - 66.02

Imports - - - - - 24.20 24.20

Bunkering - - - - - (2.35) (2.35)

Total 24.60 38.39 62.99 3.03 - 21.85 87.87

Conversion

-ublic Power

Generation - - - (3.03) 8.27 (5.24) -

Station Use/

Losses - - - - (6.11) - (6.11)

Net Supplies 24.60 38.39 62.99 - 2.16 16.61 81.79

Final Consumption

Domestic 21.03 9.35 30.38 - 0.61 1.34 32.33

Transport - - - - - 13.84 13.84

Industrial - 4.84 b/ 4.84 - 0.28 0.90 6.02

Commercial c/ 1.00 - 1.00 - 1.06 0.06 2.12

Crop Drying 2.57 24.20 26.77 - - - 26.77Other d/ - - - - 0.21 0.47 0.68

Total

a/ Estimates of woodfuel consumption by the Asau timber sawmills for process steam and

power generation are not available and hence are excluded from this balance.

b/ Biomass consumed in coconut oil mill.

c/ Includes hotels.

d/ Schools, public lighting, construction, water pumping, etc.

Source: Mission estimates.

-5-

II. ENERGY SECTOR OVERVIEW

Energy Resources

Introduction

2.1 Western Samoa's indigenous energy resources are modest.Natural forest cover is adequate for national needs and conservationmeasures are being implemented. No hydrocarbon deposits have beendiscovered. The small geothermal resource is located far from energydemand centers. Commercial energy is limited to a variable hydropoweroutput. The solar regime is favorable and, in the medium-term, may playan important role, although it is currently limited to applications suchas water heating. In the mission's view, Western Samoa's main viableindigenous resources in the immediate future are biomass and hydropower.

2.2 Like other small island countries, land in Western Samoa islimited and has a high opportunity cost. This should be borne in mindwhen considering energy applications that involve dedication of land suchas wood-fired steam power stations. All land in Western Samoa is eithercustomary land, freehold land or governmer. land. About 80% of the totalland area is customary land which co.n only be leased for use from thematai (village chiefs). Although most forest areas are customary land,Western Samoa is an exporter nf timber, which indicates the availabilityof these lands for commercial purposes. However, the process doesinvolve obtaining logging licenses from the Forestry Department andcomplex negotiations with land owners for land use rights. Governmentland accounts for 12% of the total land area and it includes theplantation areas managed by a government corporation, Western Samoa TrustEstates Corporation (WESTEC). WESTEC plants, harvests, and marketscoconut, coffee, and cocoa.

Natural Forest

2.3 Resource. Western Samoa has a substantial forest resource,estimated at about 150,000 ha (50% of its land area). Excluding pro-tected forests and national reserves (55,000 ha) and in view of GOWSintentions to further preserve and protect the natural forests, thereadily accessible forest resource is esti-.ated at about 68,000 ha. 5/Assuming an average incremental yield of 5 m3 p.a. per hectare fortropical forests, the annual potentiil fuelwood supply can betheoretically estimated at about 340,000 m

5/ COWS has been advised by UNDP to implement forest land conservationmeasures to protect particular forest ecosystems for environmentaland aesthetic purposes.

2.4 Reforestation. It is estimated that deforestation is pro-gressing at the rate of about 800 ha p.a. due to shLfting cultivation andother farming activities. In order to preserve the current rate oftimber production and to satisfy domestic fuelwood demands, the ForestryDepartment is pursuing active afforestation programs on both Savaii andUpolu aided by finance from the Asian Development Bank (ADB) and NewZealand. 6/ Villagers and landowners, particularly on the outskirts ofthe urban areas, are also encouraged to plant fast growing forest speciesfor fuelwood. A community forestry nursery with a capacity of 50,000seedlings p.a. has been established to provide farmers with seedlings.It is expected that the program will gain increased acceptance throughdevelopment of demonstration plots and mass media promotion.

2.5 Coconut Residues. Coconut residues such as shells and husksplay an increasingly important role in satisfying the energy requirementof copra drying and agro-processing industries. However, there is noexisting definitive survey to determine the total area under coconutproduction; estimates range from 50,000 ha to over 60,000 ha. Also un-clear is: (a) the distribution of this resource between Upolu andSavaii; (b) the number of coconut trees per ha; and (c) the age profileof the coconut population.

2.6 For the purposes of this report, the mission assumed a totalcoconut cover of 50,000 ha distributed betwen Upolu and Savaii in a ratioof 52:48. The mission also assumed that coconut-trees over 45 years oldcan be classified as senile and available for felling. As shown in Table2.1 below, there is a significant population of senile trees which are apotential energy resource for uses such as power generation (paras. 2.30;3.14-3.17). Added to this resource is the estimated 87,500 tonnes p.a.of husk and shell, 71 a significant portion of which could be surplusafter meeting copra drying requirements.

2.7 Assuming a density of 100 trees/ha and a weight of 900 kg/coco-nut stem (56% moisture content wet basis), it can be estimated that thestanding senile stemwood is about 1,000,000 tonnes (Upolu); and about997,000 tonnes (Savaii).

6/ Current annual planting targets are 600 ha (Upolu) and 750 ha(Savaii).

7/ Based on 1983 estimated marketed production of 25,000 tonnes ofcopra; assuming a ratio of 3.5 tons of coconut shell and husk pertonne of copra.

- 7 -

Table 2.1: AGE DISTRIBUTION OF COCONUTSCULTIVATED IN WESTERN SAMOA

Age of plantation '000 ha

More than 45 years 23.1Between 35-45 years 1.4Between 25-35 years 2.3

Subtotal 26.8

Between 20-25 years 2.2Between 15-20 years 9.2Between 10-15 years 11.6Between 0-10 years 0.8

Subtotal 23.8Total 50.6

Source: ADB Draft Report.

2.8 GOWS has recognized the importance of developing the nationalcoconut crop (since copra is the main export) and has undertaken severalrevitalization schemes. Between 1966-1977, a smallholders' coconut seed-nuts Supply Scheme led to the establishment of 21,000 ha of coconutcrop. However, the full benefits of increased productivity were notattained due to inadequate agronomical management. In 1977, a HybridCoconut Seed Project 8/ was established. This project is producinghybrid seeds which are being used for replanting by WESTEC and ultimatelyother coconut growers. Although no scientific assessment has beencompleted, it is apparent that the four-year old hybrid plants arealready producing at the rate of at least 50 nuts p.a. compared to nofruit production in non-hybrid trees of similar age.

2.9 Hydro power. The hydro potential of Western Samoa has not yetbeen systematically identified and investigated. So far the harnessedhydro potential is concentrated on Upolu and has an installed capacity of4.63 MW and produces 22.2 GWh of energy p.a. in a mean hydrological year(see Annex 3). The Sauniatu hydro project is under construction and willadd 3.50 MW of capacity and 13.9 GWh of energy p.a. when completed in1985. The major feature of Western Samoa's hydropower potential is thevery variable energy output due to very irregular rainfall patterns andthe absence of natural storage (para. 3.9; Annex 4). Two hydro schemespresently under consideration address this problem (para. 3.18-3.24).

8/ Financed by FAO/UNDP.

- 8 -

Petroleum

Historical Demand

2.10 Internal demand for petroleum products fell in 1981 and hasstagnated since then, probably reflecting the general slowdown ineconomic activity (Table 2.2). This trend holds true for all liquidpetroleum categories. Kerosene sales were affected by the high price ofkerosene and kerosene stoves. 9/ ADO demand has stagnated, partly due toincreased hydro power generation. Gasoline requirements were affected byrestrictions on vehicle imports. 10/

Table 2.2: PETROLEUM PRODUCT SALES, 1980-83

(megaliters)

1975 1980 1981 1982 1983

LPG - 0.07 0.08 /0.09 a/ 0.14

Kero 1.94 2.49 2.14 1.95 1.55

Gasoline 9.60 11.23 10.14 9.63 9.42

ADO 11.13 16.95 15.38 14.89 15.18

Av. Gas 0.22 0.21 0.20 0.20 0.16

Total Internal Demand 22.89 30.95 27.94 26.76 26.45

Jet Fuel Y 1.82 4.00 2.80 2.20 2.80

Total Demand 24.71 34.95 30.74 28.96 29.25

a/ Mission estimates.

b/ Jet fuel is mostly consum64 by foreign airlines and thus is excluded

from internal demand for petroleum products.

Source: British Petroleum, Western Samoa.

2.11 Table 2.3 gives the sectoral consumption of petroleum products:the transport sector is the most petroleum intensive, accounting for 65%of internal petroleum demand, while power generation accounted for 23% ofinternal petroleum consumption. The petroleum requirements of EPC havebeen steadily decreasing as the program to increase hydro-generationcontinues. Industrial use is small -- about 4% of total consumption --while the household sector used 6%.

9/ The cost of kerosene stoves tripled from WS$24 in 1979 to WS$72 in1983.

10/ The total value of imported vehicles and other transport equipmentfell from WS$4.4 million in 1979 to WS$3.0 million in 1982.

-9-

Table 2.3: SECTORAL CONSUMPTION OF PETROLEUM PRODUCTS, 1983

Sector Magaliters Percent

Transport 17.06 64

Power Generation 6.10 23

Industry 1.02 5

Households 1.60 6

Others a' 0.67 2

Total 26.45 100

a/ Restaurants, agricultural machinery, etc.

Sources: Mission estimates.

Petroleum Demand Proiections

2.12 The future internal demand for petroleum products will depend

on the outcome of COWS' programs for economic growth (para. 1.5) and on

the extent to which ADO-fired capacity is displaced by indigenous biomass

and/or hydro resources in the power sector (paras. 3.12-3.27). For

illustrative purposes, the mission prepared two preliminary forecast

scenarios for future petroleum product demands.

2.13 The "base" scenario which is based on GDP growth of 4% p.a.

through 1995 indicates an average annual increase of 2.4% in internalproduct demand. Underlying assumptions include (a) transport sector

demand growth of 4% p.a.; (b) household demand expansion of 22 p.a. as

incomes increase; and (c) overall slower growth in ADO demand as trans-

port/industrial needs are partially offset by increased use of biomass

and hvdro (instead of ADO) in the power sector (Table 2.4). In the event

of delayed retirement of diesel generation capacity, ADO requirements

will increase to result in total petroleum demand of 42.56 megalitres by

1995 (an average increase of 42 p.a.).

- 10 -

Table 2.4: INTERNAL PETROLEUM OEMANO PROJECTIONS

"BASE SCENARIO"(mogaliters)

Actual Forecaut

1983 1990 1995

AwGas 0.16 0.21 0.26

LPG 0.14 0.16 0.18Kerosene 1.55 1.78 1.96Gasoline 9.42 12.41 15.10ADO 15.18 19.13 25.06

Substitution ) - - -

by Indigenous ) - - -

energy sources ) -- (5.69) (7.48)

26.45 28.00 35.D8

a/ Anticipated ADO savings from hydro/woodfuel generation.

Source: Mission estimates.

2.14 The "contingency" scenario depicted in Table 2.5 assumes aslower CDP growth rate (2.5% p.a.) with subsequent sluggish growth ofpetroleum products demand by the transport and household sectors. It isalso assumed that further retirement of ADO generation capacity isdelayed until 1995. Therefore, total petroleum product demand isprojected to grow at an average rate of less than 1.0% p.a. under thisscenario.

Table 2.5: INTERNAL PETROLEUM DEMAND PROJECTIONS"CONTINGENCY SCENARIO"

(megalltres)

Actual Forecast19853 1990 1995

AvGas 0.16 0.19 0.22LPG 0.14 0.15 0.16Kerosene 1.55 1.66 1.75Gasoline 9.42 11.20 12.67ADO 15.18 16.27 18.93Substitution I - - _by Indigenous ) -energy sources ) a l- (5.69)

26.45 29.47 28.04

a/ Anticipated ADO savings from hydro/woodfuei gener:tion.

Source: Mission estimates.

- 11 -

Petroleum Pricing

2.15 Petroleum pricing in Western Samoa is contolled by the CommerceBoard 11/ which reviews requests from the oil companies for adjustment ofmargins and price levels based on changes in f.o.b. prices, freightcharges and exchange rates. The marketer's margins are based on aweighted-average cost of the three marketing companies according to theirestimated respective market shares for each product. Although there isan implied built-in "bonus" for an efficient marketer, this method doesnot encourage competitiveness in distribution. The situation is madeworse by the fact that COWS does not possess the technical capability toverify and determine the adequacy of market cost information supplied bythe marketers to establish margin adjustments. 12/

2.16 The adjustment component of the pricing formula includes sur-charges relating to: (a) recovery of foreign exchange losses on "cap-tive" company fund. awaiting availability of foreign exchange in order tobe remitted abroad; and (b) retrospective recovery of price increases.Pricing levels are supposed to be revieved on a quarterly basis. How-ever, since November 1981, only one review has been carried out(Table 2.6). In April 1983, an across-the-board price increase wasgranted, but with no specific allocation between cost increases andsurcharge items.

2.17 A recent consultant petroleum pricing study financed by UNPEDPadvised COWS that: (a) payment for unremitted funds should be separatedfrom regular administration of product prices in the interest ofefficiency and equitability; and (b) the weighted-average pricing systemshould be discontinued. COWS is considering the alternative of theCommerce Board switching to a pricing system based on the lowest-costsupplier. However, this method will still require an in-house capabilityto evaluate various cost components of the least-cost marketer. Themission believes that the question of petroleum product pricing inWestern Samoa (and other South Pacific island countries) is one componentof a strategy that also includes product supply and distribution.Therefore, the mission recommends that any further COWS decisionconcerning petroleum product pricing should await the outcome of tbeproposed regional petroleum supply analysis (para. 3.6). This *nalysi±.will examine and evaluate current petroleum product procurement andsupply arrangements in order to recommend economic and practical optionsto participating countries. 13/

11/ Chaired by the Minister of Finance with representation from thePrice Controls Board; controller of Customs; and the private sector.

12/ Western Samoa is a participant ;n regional petroleum oricingseminars arranged by UNPEDP.

13/ The study is to be financed and executed by the UWDP/World BankEnergy Sector Management Assistance Programme (ESMAP).

- 12 -

Table 2.6: PETROLEUM PROOUCT PRICING STRUCTURE

November 1981(WSf/liter)

Gasoline ADO Kerosene

F.o.b. Singapore 32.47 31.43 33.48Freight 3.96 4.56 4.21

Other overseas costs - 0.76 D.79 0.74C.l.F. Apia 37.19 36.78 38.43

Duties 14.68 9.35 3.64

Onshore costs 5,77 5.81 4.86

57.64 51.94 46.93Adjustments - 5.78 6.56 5.23

Wholesale margin 5.65 5.18 4.70

69.07 63.68 56.86

Retail margin 3.52 3.52 3.52

72.59 67.20 60.38

Effective April 8, 1983 the prices were increased by 12 sene per liter

for each product. Retail Prices increased by 12.44 sene/liter.

Wholesale 81.07 75.68 68.86

Re+ail 85.03 79.64 72.82

a/ Insurance, ocean losses & Fiji transhipment costs.b/ Surcharges accruing to oil companies for

(a) inter-company adjustment to effects of uniform pricing policy;

(b) recovery of exchange losses on unremitted funds.

(c) retrospective recovery of price increases.

Source: Ministry of Finance.

Electricity

Supply

2.18 The public power sumply system is operated by the ElectricPower Corporation (EPC), a publi- entity established by the ElectricPower Corporation Act of 1972. Tue EPC system consists of a fairlyextensive grid network covering the heavily populated western portion ofUpolu and a smaller power system at Saleloloaga in southern Savaii, asshown in Table 2.7. Since 1982, EPC also distributes electric power innorthern Savaii, generated by a 2.5 MW steam turbo/generator owned bySamoa Forest Products 1982 (para. 3.28-3.30). Self-generation by otherpublic and private agencies is limited; total capacity of such instal-lations is estimated at 0.5 MV, compared to EPC's installed capacity of15 MW.

- 13 -

Table 2.7: EPC - POWER SUPPLY/DEMAND STATISTICS, 1983

Upolu Salelologa

Installed capacity-diesel (MW) 9.80 0.42

Hydro (MM) 4.6 -

Peak Demand (MW) 5.7 0.28

Load Factor (%) 62.0 36.0

Generation (GWh) 31.1 0.88

Losses (%) 18.3 21.5

Source: Electric Power Corporation. -

2.19 Public electricity on Upolu (97% of total generation) is

generated from two sources, imported ADO and indigenous hydro in a ratio

of 3:2 (1983). In accordance with COWS policy, EPC plans to invest in

additional hydro and introduce biomass-fueled power generation as a means

of reducing the cost of fuel imports (para. 3.7). Meanwhile the existing

supply system suffers from two main constraints: (a) derated diesel

capacity due to undetermined causes; (b) extremely variable hydro output

caused by lack of natural storage capacity and irregular rainfall. 14/

(paras. 3.8-3.11; Annex 3).

Demand

2.20 Electric power consumption in 1983 amounted to 25.98 GWh

(Table 2.8). The largest sectoral consumer is commerce 15/ (44%),

followed by households (28%), and industry (13%). However, consumption

figures in the commercial and industrial sector include GOWS agencies

which are estimated to consume about 25% of total electricity sales. The

10 largest single consumers which include the oil mill, GOWS Health

Department and the two major hotels account for '5% of consumption.

After growing at an average rate of 12% p.a. between 1974 and 1979, EPC

generation on Upolu stagnated between 1979-1983. This sudden decline can

be related to the recent economic setbacks (para. 1.3). It is also

likely that tariff increases have contributed to reduced domestic demand

(para. 3.38). These developments have important implications for

existing power demand projections and future system expansion plans

(paras. 2.20-2.22).

14/ As a result of the ongoing program to upgrade transmission lines,

system losses dropped to 13.7% in 1984.

15/ Including hotels.

- 14 -

Table 2.8: EPC - POWER GENERATION AND SALES, 1977-1983(GWh)

1976 1979 - 1983

Generation 22.51 31.89 32.00Total Sales 17.51 24.30 25.98 -Commercial 5.18 5.66 11.43Domestic 5.71 9.56 7.34Industrial 1.04 1.63 3.30GOWS C 4.03 4.90 _Other d/ 1.55 2.55 3.91

a/ First full year of Salelologa system operation.b/ Includes 0.13 GWh consumed by customers connected to the public

supply from Samoa Forest Products Sawmill at Asau.

c/ Starting in 1982, GOWS consumption was included in commerce and

industrial sectors.

d/ Including hotels, charii;es, schools, and street lighting.

Source: EPC.

2.21 Monthly variations in energy demand and peak load are relative-ly small: the ratio of highest monthly peak load to lowest monthly peak

load is about 1.10 to 1.15 in r_ent years. This load pattern does not

suggest a need for major tariff structural change. However, the mission

recommends that GOWS and EPC consider putting a few large Upolu consumerson a mixed demand-energy tariff with the demand charge related to peak

demand of the consumer during system peak demand periods. A major

characteristic of the electricity cost structure in Western Samoa is the

high cost of electricity during the dry season when generation is largely

based on ADO-fired capacity. Therefore, there may be some grounds for

considering the desirability of a tariff component for large consumers

that is linked to the seasonality of electricity generation costs

(para. 3.3).

Power Load Forecast

2.22 Upolu. EPC has prepared a load forecast (Annex 5) for the

Upolu system through the year 2000 which implies an average generation

growth rate of 7.2Z p.a.; peak demand was projected to grow at a similar

rate, thus implying no change in the high system load factor of 0.62. 16/

However, in spite of the lack of national accounts data, the mission

considers that the sudden cessation of electricity growth after 1979 is

clearly related to the recent economic decline (para. 1.3 Table 2.8) and

16/ Western Samoa, Fi-ve Year Development Plan, 1983-1987.

- 15 -

that this relationship can be expected to continue in the future. 17JFinally, the cost of the schemes proposed for system expansion andreplacement of diesel generation (paras. 3.12-3.24) indicates that tarifflevels may have to be increased over the next 10 years, thus presentinganother potential brake on demand growth. The mission considers thatalthough EPC's forecast may be reasonable under favorable economicconditions, it may not be appropriate for less optimistic conditions.Accordingly, the mission considered two projections involving (a) a "basecase" scenario of 5% p.a. demand growth; and (b) a "contingency" scenarioof 2.5% p.a. demand growth (Table 2.9). -

Table 2.9: UPOLU - LOAD GROWTH FORECASTS

(1983-2000)

Year EPC Forecast Base Scenario Contingency Scenario

(GWh) (MW) (GWh) (M"4) (GWh) (NW)

1983 31.1 5.7 31.1 5.7 31.1 5.71987 38.9 7.2 37.4 6,8 34.0 6.21990 48.3 8.9 42.9 7.9 36.3 6.71995 69.3 12,8 53.9 9.9 40.4 7.42000 99.5 18.3 67.9 12,5 45.1 8.3

2.23 Savaii. The EPC energy forecast for Savaii assumed an averagegrowth rate of 9.8% p.a. between 1984-2000 based on anticipated 1983 gen-eration of 1.8 GWh. However, the mission was of the opinion that, al-though rapid growth can be expected in the next few years (due to inter-connection of the two power systems on Savaii), the factors affectingfuture growth on Upolu mentioned in para. 2.22 above will also affectgrowth on Savaii. Therefore the mission prepared an alternative powerforecast based on actual 1983 generation assuming that: (a) systemlosses will decline from 22.6% in 1983 to 15% by-the year 2000; and thatthe load factor would increase from 0.36 (1983) to 0.50 (2000). Assummarized in Table 2.10 and explained in Annex 6, the alternative fore-cast portrays average generation growth of 15% and average sales growthof 10.4% p.a. This major difference in the pattern of growth rates com-pared to EPC's forecast can be attributed to the fact that (a) actual1983 generation was much lower than anticipated; and (b) the missionforecast assumes a decline in system losses. However, developments in

17/ For example, domestic power consumption declined from 9.56 GWh in1979 to 7.34 GWh in 1983 (annual average decline of 6.4% p.a.),probably in response to higher electricity prices.

- 16 -

the next few years must be kept under close scrutiny in order to adjustexpansion schedules to actual increases in demand.

Table 2.10: SAVAII - ALTERNATIVE LOAD FORECASTS a"

Year EPC Forecast Alternate Forecast

(GWh (MW) (GWh) (GWh (MW)generated) generated) sold)

1983 0.9 0.3 0.9 0.8 0.31987 3.9 1.3 2.0 1.6 0.581990 4.9 1.6 3.0 2.4 0.81

1995 7.8 2.4 4.2 3.5 1.03

2000 11.3 3.2 4.9 4.2 1.12

a/ See Annex 6 for details.

2.24 In summary, the mission considers that the alternative invest-ment decisions facing EPC are sufficiently diverse and costly in natureto warrant sensitivity analysis over a wider range of forecasts.Therefore, the mission recommends a technical assistance effort to aidthe Government and EPC in preparing alternative lower demand forecasts tofacilitate economic evaluation of alternative projects and in preparingalternative project commitment schedules (paras. 3.26-3.27; Annex 9).

Biomass

2.25 Background. Wood, coconut residues and sawmill wastes areextensively used for domestic energy and crop drying requirements. Table2.11 shows mission estimates for biomass demand. Total household demandwas estimated at 85,000 tonnes p.a. 18/ Copra drying requirements wereestimated at 63,000 tonnes p.a. while industrial requirements amounted toabout 11,000 tonnes/year (para. 2.29).

18/ Based on a Forestry Division Survey of village households in theApia area in 1981 which showed that households relying on fuelwoodalone consumed between 1.6 kg-2.2 kg per capita per day. The missionchose the lower esl-imate which was more in keeping with per capitaconsumption in other Pacific countries. The mission also assumedthat half of Apia's population used fuelwood only part of the time,i.e. consumed 80 kg per capita per annum.

- 17 -

Table 2.11: BIOMASS DEMAND ESTIMATES, 1983

Sector Tonnes

Domestic a/ 85,000Copra Production 62,500Coconut Oil Mill 11,000Cocoa Board 300Irstitutions 3,000

Total 161,800

a/ This category refers only to marketed copra.

Source: Mission estimates.

2.26 Domestic Demand. The majority of households in Western Samoacook with wood and, to a lesser extent, coconut residues. A small amountof charcoal is made by villagers from coconut shell, mainly for householduse. Use of firewood in the urban areas appears to be on the increase;mainly in response to higher electricity and kerosene prices. Fuelwoodtrade is commercialized only around Apia (where 22Z of the otalpopulation lives). Prevailing fuelwood prices are between WS$30.0/m andWS$60.0/m . Wood purchased from the markets, sawmills and agroindustriesis estimated to provide half of Apia's fuelwood requirements; the rest isgathered "free" from household lots and customary land. The developmentof a fuelwood market has led traders to increase felling of trees in thewater catchment forests surrounding Apia. In an effort to protect theseforests, the Forestry Department has introduced a Community Forestryprogram (para. 2.4). Rural fuelwood is obtained "free" while ruralcharcoal requirements are supplied on the household level from homemadecharcoal kilns (usually 55-gallon oil drums).

2.27 Improved Stoves. The GOWS established a Rural DevelopmentProgram in 1977 which among other things has been responsible forpromoting a successful improved charcoal stove project. Improved fuel-wood stoves made from cement and concrete failed to gain popularitybecause they were found to crack easily. The portable charcoal stovesare made from concrete and retail for about WS$5.0. Within one year, theproject sold more than 4,000 stoves in the Apia area, using demonstra-tions and radio broadcasts to disseminate information. Since then, theproduction of charcoal stoves has been passed on to the private sector.The mission commends this effort to improve cooking fuel efficiency rates(thus reducing the environmental impact of fuelwood harvesting in theApia area).

2.28 Copra drying. This is the process whereby the coconut husk andshell are separated from the coconut meat and are then used to dry themeat into copra. Residues surplus to copra requirements are available asfuel. Copra-making is a long-established activity in Western Samoa,

- 18 -

although production fluctuates markedly in response to prices and thecash needs of farmers. 1983 marketed copra production was estimated atabout 25,000 tonres, of which WESTEC produced about 4,000 tonnes andsmallholders produced 21,000 tonnes. Smallholder copra drying is done bycoconut husk and shell but WESTEC utilizes wood to some extent. Thetraditional open-fire drying method is reckoned to require about 2.5tonnes of 'iomass fuel per tonne of copra produced. However, there is anincreasing a;'areness in Western Samoa of the benefits of wood-fired hot-air generators for crop-drying which, apart from producing better-qualitycopra, also include less biomass consumption (less than 1.0 ton of bio-mass/ton of copra).

2.29 Other Agro-industries. Several other agroindustries in WesternSamoa already use biomass residues for their process heat requirements:

(a) Samoa Coconut Products Ltd. (SCPL) operates a coconut residue-fired boiler at its coconut oil factory. The boiler uses about1,800 kg of coconut husk/shell on a hourly basis to produce3,850 lb per hour of 150 psi saturated steam. Annual fuelrequirements are about 11,000 tonnes of residue.

(b) The Cocoa Board of Western Samoa has already retrofitted two ofits 6 diesel-fired driers with 100 kW wood-fired hot-air gen-erators. Wood consumption per drier is about 700 kg per day,while a diesel-fired drier requires 215 liters per day. Basedon diesel costs of WS$0.8/liter and delivered wood costs ofWS$6.0/tonne, the Cocoa Board estimates its fuel cost savingsat WS$165.0 per day (para. 3.37).

(c) Samoa Forest Products Sawmill at Asau on Savaii utilizessawmill waste to fire its boiler to provide process steam.Excess steam is converted into electric power by a 2.2 MWturbo-generator (paras. 3.28-3.30).

Biomass Supply and Demand Projections

2.30 The mission did not observe any current general shortage ofbiomass fuels, and there would appear to be a significant potential forincreasing the availability of coconut residues from via improved copradrying methods; and for increased forest resources contribution throughcommunity afforestation and timber plantations (paras. 2.3-2.8). It mayalso be possible to utilize a portion of the substantial senile coconuttree stock on Upolu to fuel a proposed wood-fired steam power stationwhich is about to be implemented (paras. 3.14-3.17).

2.31 The mission has prepared crude biomass supply/demand projec-tions through 1995. Although such projections are only approximate, theyprovide some indication of future maximum demand and the supply-sidesteps to be taken to meet such demand. The underlying assumptions are(a) domestic fuel consumption grows at 1Z p.a. in direct relationship topopulation growth; (b) a wood-fired power station is commissioned to

- 19 -

provide Upolu dry season baseload; (c) senile coconut stemwood isharvested for power generation under a planned coconut rehabilitationprogramme; (d) availability of coconut residues increases at 12 p.a.;(e) the increased efficiency of copra-drying methods is offset by moresubstitution of coconut residues for petroleum in other agro industries;and (f) the sustainable contribution of natural forest resourcesincreases by 1.5Z due to reforestation and better logging and harvestingmethods. It should be noted that, if senile coconut stemwood is notavailable for wood-fired generation, the annual contribution of naturalforests would have to increase substantially, by at least 5X p.a. (paras.3.14; 3.16).

Table 2.12: BIOMASS DEMAND/SUPPLY PROJECTIONS, 1983-1995

('000 toe)

1983 1990 1995

Supply

Natural Forest 24.60 25.80 29.10

Coconut Residues 38.39 42.18 43.39

Senile Coconut Stemwood - 14.04 17.20

62.99 82.02 89.69

Demand

Domestic 30.38 32.57 34.23

CommerciaI 1.00 1.20 1.30

Crop Drying/Agro Processing 26.77 27.72 28.42

Industrial 4.84 4.84 4.84

Power Generation - 15.69 20.90

62.99 82.02 89.69

- 20 -

III. ISSUES AND OPTIONS

Introduction

3.1 Western Samoa's energy sector is relatively well-managed andprogressive. Although internal petroleum requirements have been de-pressed during the recent economic difficulties, there is no evidencethat reduced petroleum imports have seriously restrained economicgrowth. Possibilities for displacement of petroleum fuels in the powersector and agro-processing sector are considerably more advanced than insome other Pacific Island countries. In terms of fuelwood supply, it isexpected that recent afforestation programmes and environmentalprotection measures will succeed in preserving the forest resource.Although there are ample biomass resources in Western Samoa, the actualavailability of such resources for energy exploitation beyond thetraditional domestic cooking and copra drying purposes will depend on anumber of factors, including (a) developing successful lease arrangementswith village chiefs; (b) developing a senile coconut stem harvesting anddelivering scheme; (c) improving the efficiency of traditional biomassenergy use in domestic and smallholder copra drying; and (d) developingenergy plantations in marginal lands (e.g. lava lands), particularly inUpolu.

3.2 It is expected that the recently appointed Energy Advisor willperform the task of liaison between the Commerce Board (petroleum supplyand pricing); the Ministry of Agriculture, Forests and Fisheries (bio-mass); and EPC (power supply). In view of the fact that the vaziousenergy subsectors are well managed, the main task of the Energy Advisorwill be to further evaluate current energy proposals within the nationaleconomy context. The major issues in the energy sector are(a) evaluation of least-cost petroleum supply options; (b) development ofa least-cost power system expansion strategy; (c) electricity pricing;and (d) continued economic substitution of indigenous energy sourcesfor imported petroleum products.

Petroleum Supply Arrangements

3.3 The current pattern of petroleum supply and distribution forWestern Samoa involves three distinct stages: (a) shipment of petroleumproducts from refineries in Singapore and Australia into bulk storage inFiji at Vunda Point; (b) transshipment of Western Samoa's petroleumrequirements from Fiji to Apia and Savaii; and (c) internal storage anddistribution within the country. The total bulk storage capacity (8.7megaliters), which is owned and operated by the oil companies, is suffi-cient for about four months' demand coverage (1983 levels).

- 21 -

3.4 Prior to September 1984, each of the three oil companiesoperating in Western Samoa -- Mobil, Shell and British Petroleum -- hadbeen responsible for making its own import arrangements as well asinternal distribution and marketing. Since then, COWS has consolidatedthe country's petroleum requirements into one combined contract fortender. Thus, all the offshore functions of procurement and shipping toApia will be carried out by one company, while the internal storage anddistribution aspects remain unchanged. This move is expected to resultin import cost savings through more efficient shipping arrangements forWestern Samoa's relatively modest petroleum market (less than 30 mega-liters in 1983).

3.5 On a larger scale, there is a possibility of consolidatingWestern Samoa's petroleum requirements with those of other South PacificIsland countries interested in minimizing their petroleum import costswhile retaining security of supply. A combined regional petroleumcontract could be used to seek competitive bids from establishedinternational oil companies who, with their diversified sources ofpetroleum products, could guarantee minimum risk of supply disruption.Potential suppLiers to such a combined market would have sufficientincentive to quote competitive f.o.b. and freight rates. For example,the total petroleum imports requirements of the South Pacific Islandcountries in 1981 amounted to about 1,160 megaliters. 19/ According topreliminary estimates, freight costs could be reduced by at least 5-10%by developing an optimum regional transport strategy. 20/

3.6 As a result of the perceived benefits oE a regional petroleumprocurement arrangement and in view of the fact that Western Samoa willfind itself faced with higher unit costs if freight rates increase in thefuture, the mission recommends that GOWS assign priority to participationin an analysis of regional petroleum procurement and transport arrange-ments. To obtain a quantitative assessment of the expected benefits, themission recommends the provision of technical assistance to six countriesof the region - Western Samoa, Papua New Guinea, Fiji, Solomon Islands,Vanuatu and Tonga -- which together account for over 95% of regionalpetroleum demand. Particular attention would be paid to security andcontinuity of supplies, tanker size, transport logistics and petroleumfaciLities for petroleum products of appropriate quality. The primaryobjective of such assistance would be to identify and evaluate alter-native petroleum supply options available to the region based on

19/ Most of this is accounted for by Papua New Guinea (56%) and Fiji(28%).

20/ East West Centre.

- 22 -

previously completed studies. 21/ The findings would be presented toparticipating governments together with estimates of the medium-termtechnical assistance required for government agencies to implement andadminister the recommended option (Annex 9).

Upolu Power System

3.7 Background. The immediate planning task of EPC is to: (a) im-prove present generating capacity of the Upolu system; and (b) developalternatives for economic substitution of indigenous hydro and biomassresources for imported ADO in power generation.

Upolu Capacity Constraints

3.8 Diesel. According to EPC generation planning schedules,additional capacity would be required by 1987 as shown in Annex 5. How-ever, additional energy would not be required before 1993 (dry yearscenario) and 1995 (mean hydrological scenario). The early requirementof new capacity is determined by EPC's planning assumption that dieselengines will be replaced when they are 20 years old. Normally, wellmaintained diesel engines may run for more than 20 years. However, EPChas had difficulty with maintenance and cooling, has had to derate theengines by 30Z, and has several engines which are considered unsuitablefor continuous operation (Annex 3). These factors, along with the costof spare parts, justify a conservative estimate of economic life. Themission supports EPC's request for technical assistance to determine theeconomic and technical feasibility of a proposal to increase theeffective capacity of existing Upolu diesel sets (Annex 9).

3.9 Hydro. The four existing hydro plants of Upolu are run-of-the-river and are characterized by (a) minimal pondage capacity (average 1-2hour); and (b) irregular rainfull patterns on a yearly, monthly and dailybasis. As a result, hydro electricity output varies significantly. Forexample, anticipated generation capability has been known to range from20 GWh in a year of average rainfall to 12 CWh in a dry year (Annex 4).For long-term planning purposes, EPC uses the following capabilities forits hydro plants including the Sauniatu plant currently under construc-tion, as shown in Table 3.1 below.

21/ These studies were carried out by UNPEPD (Fiji) and the East-WestCentre (Honolulu).

- 23 -

Table 3.1: EPC - HYDRO CAPABILITY FOR PLANNING PURPOSES

C Capacity EnergyWet Season Dry Season/ Average Year Dry Year

Plant Dry Year

(MW) (GWh)

Alaoa 1.0 0.3 4.5 3.2

Fuluason 0.4 0.1 2.1 1.5

Fole-ole-Fee 1.6 0.3 7.1 5.7

Samasoni 1.5 0.3 8.5 4.4

Sauniatu 3.5 0.8 13.9 9.0

Total Hydro 8.0 1.8 36.1 23.8

3.10 The mission has prepared a generation schedule based on itsbase demand growth scenario of 5% p.a., as shown in Table 3.2. In thisscenario additional energy would not be required before 1996 in a dryyear and 1999 in a mean hydrological year. Additional capacity would berequired by 1987/88. For the purposes of establishing EPC's presentpower system parameters, the mission has excluded generation projectsproposed for implementation after 1984. Existing diesel and hydrocapacity include the Sauniatu hydro project currently under constructionand to be commissioned in 1985. Also included is a 2 M- overhauleddiesel set to be installed during 1984. The energy capability of thehydro plants is net of spill. Spillage is unavoidable since water flowsare very irregular and plant storage is minimal. Spillage will decreaseover time as demand grows but will never be totally eliminated.

3.11 However, this scenario assumes the exclusive use of diesel as asupplement to run-of-river hydro. It is also apparent that a capacityconstraint will arise during a dry year, dry season scenario during1987/88. This could be addressed either by (a) providing seasonalstorages in the river basins of existing hydro stations, which appearsdifficult; or (b) providing seasonal storage in other river basins andcomplementary generating capacity at new hydro stations in those rivervalleys. The mission recommends that EPC continue its investigations ofthe possibility of increasing storage as a means of relieving capacityconstraint (Annex 9).

Table 3.2: UPOLU SYSTEM, DEMAND AND SUPPLY

1984 - 2000

Energy (GWh) Energy (GWh) Capacity (NW)

Mean Hydrological Year Dry Year Dry Year/Dry Season

Existing Existing Existing Existing Existing Existing

Hydro Hydro Diesel System Hydro Hydro Diesel System Hydro Diesel System

Load Capability Deficit Capability Deficit Load Capability Deficit Capability Deficit Load Capability Capability Deficit

1984 32,6 20,4 12.2 58.4 - 32,6 13,6 19.0 58.4 - 6.0 0.7 5.5 -

1985 34,2 27,3 6,9 54.5 - 34,2 18.4 15.8 54.5 - 6,3 1.5 5.1 -

1986 35,7 29,6 6,1 54.5 - 35.7 19.5 16,2 54.5 - 6.6 1.5 5.1 -

1987 37.4 30.1 7.3 54.5 - 37.4 19.8 17.6 54.5 - 6.9 1.5 5.1 0.3

1988 39.2 30,3 8.9 54.5 - 39,2 20.0 19,2 54.5 - 7.2 1.5 5.1 0.6

1989 41.0 30.9 10.1 38.8 - 41.0 20,4 20.6 38.8 - 7.5 1.5 2,7 3.0

1990 42.9 31,2 11,7 38,8 - 42,9 20.6 22.3 38.8 - 7.9 1,5 2.7 3.7 >

1991 44,9 31.6 13,3 38.8 - 44.9 20.8 24.1 38.8 - 8.3 1.5 2.7 4.1

1992 47.0 31.9 15.1 38,8 - 47.0 21.0 26.0 38.8 - 8.7 1.5 2.7 4.5

1993 49.2 32.1 17.1 38.8 - 49.2 21,2 28.0 38.8 - 9.1 1,5 2.7 4.9

1994 51.6 32.3 19.3 32.2 - 51.6 21,3 30.3 32.2 - 9.5 1.5 1.5 6.5

1995 54.0 32,5 22,5 32,2 - 54.0 21.4 32.6 32,2 0.4 9.9 1.5 1,5 6.9

1996 56.5 32,9 23,6 32,2 - 56,5 21.7 34,8 32.2 2.6 10.4 1.5 1.5 7.4

1997 59.1 33.4 25,7 32,2 - 59.1 22,0 37.1 32.2 4.9 10.9 1.5 1.5 7.9

1998 61.9 33,7 28,2 32.2 - 61.9 22.2 39.7 32,2 7.5 11.4 1,5 1I5 8.4

1999 64.8 34.0 30,8 16.4 14.8 64.8 22.4 42.4 16.4 26,0 11.8 1.5 - 10,1

2000 67.9 34,3 33,6 16,4 17.2 67.9 22,6 45.3 16.4 28.9 12.5 1.5 - 11,0

Source: EPC; Mission estimates.

Notes: (a) Existing hydro capacity provides for 300 kW on maintenance.

(b) Existing diesel capacity provides for outage of the two largest sets; and for gradual retirement.

(c) Energy capability Is set at a 75S capacity factor on available plant.

- 25 -

Upolu System Expansion Options

3.12 EPC's second planning concern is the replacement of existingdiesel generation indicated am "hydro deficit" in Table 3.2. EPlCcurrently is considering three different generation options: (a) a s;od-fired steam plant; (b) the Afiamalu pump-assisted hydro storage stheme:and (c) the Afulilo-Fagaloa hydro plant. These projects are scheduledfor completion by 1987, 1988 and 1994, respectively. All three optionshave been evaluated against diesel generation, but have not beenevaluated within the context of a sector-wide least-cost power expansionstrategy. Development of such a strategy is essential before making anyinvestment decisions concerning any of these relatively large generationoptions. Therefore, the mission recammends that a detailed least-costpower expansion study be carried out (paras. 3.25-3.27).

3.13 One of the parameters for evaluating any generation project onthe Upolu system would be its expected firm capacity during the dryseason. Therefore, the mission performed a preliminary evaluation ofeach option -- based on existing studies -- concerning the expected costof firm capacity as compared to expected ADO capacity and fuel savings(paras. 3.14-3.24).

Wood-fired Steam Plant

3.14 This project is in the final design stage and EPC reports thatall required financing has been secured. 22/ In the mission's view wood-fired power stations cost more per installed capacity unit and have,higher operating and maintenance costs than diesel-fired capacity -- adiffere-ce of USc2.0/kWh generated is assumed -- EPC expects to obtainfuelwood at a delivered cost that is low enough to offset this dis-advanLage.

3.15 Capital Costs. The current proposal is for a 2 x 2.5 "W plantwith reported capital costs of US$11.0 million, including US$1.0 millionfor establishing a dedicated fuelwood plantation (para. 3.16). However,in view of recent reductions in world prices for such plants, the missionassumed capital costs of US$9.0 million for a turnkey installed plant 23/plus US$1.0 million for the fuelwood plantation. Assuming a 'p .a.interest rate and a 30-year economic plant life, WFPS annualized capitalcosts would be US$1.06 million, compared to US$0.45 mill7 n for

22/ New Zealand, Kuwait and Saudi Arabia are financing this project.

23/ 3ased on other bids for similar stations in the Pacific over thelast 12 moaths.

- 26 -

equivalent diesel-fired capacity. 24/ This suggests that any WFPSprocurement undertaken should be an open ccpetitive bid system toreceive the best prices.

3.16 Fuetwood costs. The biomass fuel is expected to be based onsenile coconut stems arising from a coconut replanting scheme, forestryand/or sawmilling residues, agricultural residues (coconut husk andshell), and the cuttings from a 640 ha plantation to be established forEPC by the Departmenit of Agriculture. It is important to develop anaccurate delivered cost of fuelwood since it has a significant impact onWFPS power generation costs (Table 3.3). It is equally important thatthe supply of fuelwood be reliable, as otherwise the plant would beoperating at a lower load factor. Therefore a balance must be struckbetween the lower costs associated with the use of coconut residues andstemwood, and the reliability expected from a dedicated energyplantation. A dedicated energy plantation to support a 5 MW steam plantcould require up to 5,000 ha. of land. 25/ It is unlikely such a blockof land could be made available on Upolu, in view of other landrequirements such as agriculture (paras. 2.2; 2.31). On the other hand,although coconut stemwood/residues and forestry wastes are theoreticallyavailable for significant power generation (paras. 2.3-2.8), thepractical problems of guaranteeing an adequate supply at the plant gateover the entire project life are substantial. Collection of biomass fromdiverse locations and ensuring timely transport to the plant will requirea detailed study of the logistics involved. Table 3.3 shows the effectof two different sets of assumptions about the delivered cost of fuelwoodand average load factor on WFPS generation costs compared to equivalentnew ADO capacity.

3.17 Summary. For the WFPS to have any significant benefits,several factors must be considered: (a) a reliable supply of fuelwoodshould be available at a relatively low cost throughout the projectcycle; (b) the WFPS should operate at a high load factor of 0.6 or more;(c) sizing and configuration of the plant should ensure maximum firmcapacity; and (d) capital investment outlays should be minimized. Twoaspects require special consideration before the project can be evaluatedwithin the context of a least-cost power study. First, a final verifica-tion of the biomass fuel resource is necessary to determine the avail-ability of non-energy plantation fuelvood over the life of the plant andthe optimal sizing of the energy plantation in order to estimate thedelivered cost of fuelwood, harvesting and transport arrangements, andoptinal siting of the power plant. It then would be possible to estimate

24/ Assuming 2.5 x 2 MW of diesel capacity at US$700/kW installed with a20-year project life. The annualized capital cost has been adjustedto reflect this difference in project duration.

25/ Assuming a sustainable yield of 20m3 /ha/year; and 0.885 tonnes/m3;and ultimate annual generation of 30 GWh.

- 27 -

a true levelized cost of power production. Second, in view of recentreductions in the quoted costs of wood-fired power plants, GOWS shouldconsider plant procurement through an open co-nuetitive bid in an effortto minimize the capital investment outlay. Consideration should also begiven to procuring a WFPS of smaller capacity, e.g., 2.5 MW, which couldbe doubled at a later date as load builds up and the biomass resource isfully assured (paras. 3.25-3.27).

Table 3.3: WOOD-FIRED POWER STATION GENERATION COSTSAND EXPECTED SAVINGS

(USt/kWh)

Scenario A Scenario B

Fuelwood a/ 4.5 6.0Capital Costs b/ 4.0 8.0Operating a Maintenance Differential 2.0 2.0

10.5 16.0ADO Generation c/ 14.0 14.0Expected Savings 3.5 (2.0)

a/ Assuming fuelwood requirements of 3 kg. greenwood/kWhgenerated. Greenwood is defined as 50% moisture content, wetbasis at delivered cost/tonne of US$15 (Scenario A); and USS20(Scenario B).

b/ Assuming capital outlay of USS10 millior, aconomic life of 30years, and a load factor of 0.6 (Scenario A); and 0.3(Scenario B).

c/ Assuming capital outlay of USS3.5 million, economic life of 20years, load factor of 0.6 and ADO fuel cost of USf12/kWhgenerated.

Source: Mission Estimates.

Afiamalu Pumped-Assisted Hydroelectric Scheme

3.18 This scheme consists of a 5 MW hydro plant operating under3 ahead of 700 meters supplied from a reservoir of 3.5 million m3.According to the pre-feasibility report, a suitable site for thereservoir exists at Afiamalu, 10 km from Apia at an elevation of 730metres. 26/ Due to the porous nature of the underlying soils and rocks,it has been proposed that the entire reservoir be lined with high densitypolyethylene, 1.5 mm thick along the reservoir perimeter and 1 mm overthe remaining area. ihe main source of water would be the West VaisiganoRiver from which 1 m /second would be pumped into the reservoir over avertical distance of about 240 m through a 1355 m long pumping main.

26/ "Feasibility Study on Afiamalu Pump Assisted Hydro-electricDevelopment", Mander, Raikes and Marshall, U.K. September 1983.

- 28 -

Average water depth would be 8 metres. The scheme would be expected toprovide short-term storage in compensation for the significant hourly anddaily variation of the existing run-of-river hydro plants (para. 3.9),thus reducing the need for thermal generation. However, the dry seasoncapacity is only about 2 MW.

3.19 Additional studies to complete the feasibility stage and pro-duce the engineering design report and draft tender documents are esti-mated to cost US$415,000 over a 14-month period. ADB proposes to contri-bute US$250,000 towards this purpose, while COWS assumes responsibilityfor a fair amount of additional geological drilling and for furtherdetailed surveys and mapping.

3.20 The estimated cost of the scheme ranges between US$12.5 millionand US$14.0 million, depending on the specific location of the power-house. According to the report, the favored location indicates a capitalinvestment of US$14.0 million for an average annual net generation of11.25 GWh. The mission performed a preliminary calculation to obtainsome idea of the magnitude of expected project costs and benefits.Assuming a plant life of 40 years and a lOX p.a. interest rate,annualized capital costs would be US$1.43 million and a firm capacity ofabout 2 MW during the dry season (implying a firm capacity cost ofUS$7,000JIW). Expected net annual savings would be US$1.54 million(implied cost of equivalent ADO capacity and fuel). 27/ Thus, anyadverse occurrence such as overestimation of net power output, under-statement of actual capital outlay requirements, or technologicalobstacles may well result in hydro power production that is more expen-sive than existing generation.

3.21 A detailed economic evaluation of such a scheme requires a fineunderstanding of its operation within the generation system over the lifeof the project. Factors to be addressed include the duration and timingof the pumping periods and determination of the value of expected savingsat various stages in the project life-cycle. According to the study, thedevelopment would benefit from some natural water inflows but wouldmostly make use of otherwise spilled water to make useful energy forpumping; this would require a relatively favorable situation in terms ofthe difference between pumping and turbine heads. A full evaluation ofthis scheme and its optimal timing can only be carried out within theframework of a sector-wide least-cost power expansion strategy. There-fore, the mission recommends the project be revie-oed within the context

27/ Assuming the project would save 2 MW of ADO-fired capacity atUS$700/KW installed and an economic life of 20 years implies anannual capacity credit of US$0.19 million; average net generation of11.25 GWh p.a. at a fuel cost of US$0.12/kWh generated indicatesannual fuel savings of US$1.35 million. The calculation is adjustedfor differences in expected economic project life, but does not takeinto account any difference in maintenance cost.

- 29 -

of the proposed sector study that would include development of a least-cost power system expansion strategy (paras. 3.25-3.27).

Afulilo-Fagaloa Hydro Scheme

3.22 This scheme provides for 10 MW of hydro consisting of (a) anupper reservoir (live storage capacity of 10 million m3) and associated2 x 1 MW powerhouse at Afulilo; and (b) a lower reservoir (live storagecapacity of 1 million m3) and 4 x 2 MW associated power house at Fagaloa(including 2 MW of standby capacity). As per the consultant report,neither of the reservoirs would require any lining to reduce seepage.The located site is on the eastern coast (IBRD Map 18656), and theselected transmission route via the southern coast would require 48 km of66 kV transmission line for connection to the main load center in Apiavia the southern coast.

3.23 The capital costs of the scheme are estimated at US$23.5 mil-lion. Assuming a plant life of 50 years at 101 p.a. interest rate,annualized capital costs would be US$2.37 million for maximum firmcapacity of 7.6 MW. Average energy contributed by this project couldreach 28.5 GWh p.a. if demand so justified. 28/ This indicates potentialgross benefits of US$4.15 million p.a. (which would be the cost ofequivalent ADO-fired generation). However, the scheme as it stands istoo large -- installed capacity of 10 MW as compared to current maximumUpolu demand of 5.7 MW. The implied delay in full utilization of thescheme would result in significantly increased costs per kWh generated.Preliminary consultant analysis concluded that staged development was noteconomically feasible; building the lower station first would mean apossible output of 6 MW but minimal storage, thus defeating the purposeof solving the dry season hydro deficit (paras. 3.11-3.13). Building theupper station (Afulilo) first -- which has storage -- was considereduneconomic.

3.24 However, it is possible that the parameters of the existingproposal were optimized in isolation without considering the system-widecontext. In 1969 a suggestion was made that an 8 MW installation atAfulilo could be considered for the first stage of the project. Themission recommends that alternative configurations of the Afulilo-Fagaloahydro project be further evaluated within the framework of the proposedleast-cost power expansion study (paras. 3.25-3.27).

Conclusion

3.25 The three power generation options currently under con-sideration as alternatives to expanding ADO-fired capacity are allrelatively large projects compared to existing system capacity andinvolve considerable capital investment outlays. They are also

28/ 25 GWh p.a. (Fagaloa) and 3.4 GWh (Afulilo).

- 30 -

dissimilar as regards the basic functions, i.e., the Afiamalu pump-assisted storage hydro option implies a "peaking" operation dependent onoutside energy sources for its pumping requirements; the WFPS proposal islikely to be a "base load" operation; while the Afuiilo-Fagaloa hydrodevelopment could function as both "peaking" and a "base load," if thereis sufficient storage.

3.26 Therefore, these projects can only be fully evaluated againsteach other in the context of a least-cost system expansion strategy thatwould also include the possibility of further expanding relativelycheaper run-of-river hydro supplemented by ADO-fired capacity. Importantfactors to be considered are the expected reliability of power supply,the relative risks of not meeting load requirements or of surpluscapacity, and the cost of short-term adjustments which might becomenecessary. Proposals for improving existing generation facilities anddeveloping alternative load forecasts could also have an effect on thechoice and scheduling of power system capacity increments (paras. 2.24;3.8-3.11). For example, improved diesel operations and increased hydrostorage could increase available capacity during the dry season.

3.27 The mission recommends technical assistance for EPC to carryout an integrated power system operation and planning study that wouldinclude:

(a) investigation of potential improvement of existing generationand transmission/distribution facilities;

(b) development of alternative load forecasts;

(c) development of least-cost system expansion program; and

(d) review and possible modification of present tariffs (Annex 9).

This analysis should be carried out before embarking on any significantpower sector investments.

Savaii Power System Expansion

3.28 Wood-Fired Steam Generation. The Asau Sawmill on Savaii,operated by Samoa Forest Products Corporation (SFP) on behalf of COWS,has a 2.2 MW turbo generator which produces in-house electric power uti-lizing excess steam from the waste-fired boiler. The boiler and turbine

- 31 -

capacity is in excess of the sawmill's requirements; 29/ this has led tothe formulation of a UNDP-financed scheme to extend transmission linesfrom the sawmill around the island. At present, power from the sawmillis distributed free of charge to about 100 consumers in Asau village; theobjective of the scheme would be to increase rural electrification bybuilding a 90 km, 22-kV transmission line between Asau and Salelologa,thus integrating the two power systems (para. 2.18). The completedscheme would be expected to produce petroleum import savings of up to 70toe (ADO) and 650 toe (kerosene) on an annual basis.

3.29 The mission visited the sawmill arid found the associated powergeneration facility to be an inefficient operation. The electricity -en-eration equipment is frequently shut down due to lack of timber residuefuel or mechanical failure. 30/ Lack of funds for preventive maintenancework and Long lead times for procurement of essential spare parts resultsin significant downtime. Although the boiler is rated to be capable ofgenerating 50,000 lb/hour of steam and the maximum generator output to be2.5 MW, these figures cannot be verified since boiler fuel consumption,steam generation rates and power generation rates are not monitored andappropriate records are not kept. The wood supply to the sawmill isanother issue to be considered.

3.30 Therefore the mission considers it a priority that before anyfurther system integration work is carried out, technical assistance beprovided to GOWS for investigating plant reliability; the availabilityand cost of required residue feed/stock; excess power generation poten-tial; maintenance requirements; boundary definition for power trans-mission; and an analysis of required investments (Annex 9).

3.31 Additional Diesel Capacity. In order to back up thispotentially unreliable supply in Asau, EPC intends to purchase andinstall in Asau, an overhauled Mirrlees diesel generator with 2.2 MWnameplate rating. In addition, EPC has recently installed in Salelologa,a secondhand Caterpillar diesel generator of 0.12 MW capacity; to befollowed by a further 2 x 0.15 MW diesel capacity in 1985. If theseplans are implemented, installed capacity on Savaii Island would total4 MW (1.2 MW from the sawmill; plus 2 MW diesel capacity in Asau; and0.8 MW in Salelologa). This is a very large installed capacity coc.paredto even EPC's peak demand forecast of 3.2 MW through the year 2000.However, the firm capacity situation could be as low as 0.8 MW based on

29/ In February 1984, EPC estimated the sawmill's maximum load to be1.1 MW.

30/ The sawmill itself is often shut down due to inefficient delivery oftimber to be processed.

- 32 -

simultaneous outage of the two largest generators in Asau; 31/ such firmcapacity would be insufficient by 1990 according to mission forecasts.

3.32 The mission recommends that EPC consider installing severalsmaller diesel sets instead. The higher operating costs of small dieselscompared to a 2000 kW machine would not matter as long as the sawmillgenerator provided most of required energy for Asau with the dieselsbeing phased-in as required to provide stand-by capacity. For example, 3x 600 kW sets would result in firm power of 1,200 kW in Asau and firmpower of 2,040 kW for the island as a whole. 32/

Electricity Pricing

Introduction

3.33 The main concern regarding tariffs charged for electricity is,in the mission's opinion, the average level as it affects EPC's financialposition and its capability to contribute from internally generated fundsa reasonable share of the cost of system expansion. Tariffs have laggedvery significantly behind the cost of diesel oil which is a major costelement since EPC still generates well over half of its power from dieseloil. The result is that EPC's financial situation is far from healthy atthis time. Subsidiary issues are the lack of differentiation of tariffson Upolu and Savaii though costs on Savii are much higher then on Upolu(Table 3.5); and the likely desirability of introducing a seasonal tariffor a demand charge for a small number of large consumers (para. 2.21).

3.34 Currently, EPC depends on ADO for 60Z of its generation needs(para. 2.19). Therefore the price of ADO is an important determinant ofgeneration costs. Over the period 1972-1983 -- as far as dieselgeneration was concerned -- EPC's fuel cost per kWh sold increased fromTC 1.0 to Tc 24.0 for diesel generation. Consequently the share of fuelin the operating expenses of diesel stations stood at 63% in 1983. Onthe other hand, tariff increases during the same period have lagged farbehind ADO cost increases, as shown in Table 3.4 below.

3.35 The mission recommends that EPC be allowed to pass on to thefinal consumers all such increases in the cost of power supply as rapidlyas possible. For example, an automatic fuel adjustment clause would

31/ Such a failure could come about if the 2-MW Asau diesel is onmaintenance outage; and the wood-fired generator is out of actiondue to mechanical or feedstock problems.

32/ During Government discussions, the mission was informed that EPC haddecided to relocate an existing 300 kW generation unit to Asaurather than install a 2.2 MW unit.

- 33 -

ensure that increases in the cost of ADO were reflected in the elec-tricity tariff.

Table 3.4: EPC -- DIESEL FUEL COST AND AVERAGE a/REVENUE

(WStjkWh Sold)

Year ADO Cost b/ Average Revenue

1972 1.0 3.3

1977 4.6 7.0

1983 24.0 23.0

a/ This table refers only to ADO-based electricity supplies.

b/ Assuming generation of 3.34 kWh/liter.

Source: Mission estimates.

Tariffs

3.36 The mission attempted preliminary estimates of average produc-tion costs for the power sub-systems as shown in Table 3.5. With theinclusion of losses and station usage, cost per kWh sold was WS$0.29 onUpolu (WS$0.14 hydro and WS$0.39 diesel); and WS$0.59 per kUh sold onSavaii. The current unitary tariff is US$0.28IkWh with a minimum chargeof WS$4.0/month (equivalent to about 14 kWh/month). This tariff has beeneffective since June 1983 when it was raised from WS$0.23/kWh. Takinginto consideration discounts allowed for early payment (average period ofoutstanding bills is 21 days) the effective tariff rate is US$0.27/kWh.Consequently, EPC has been incurring net operating losses during recentyears. 33/ EPC's projections of capital investment requirements through1995 amount to over WS$90 million -- more than twice its present totalfixed assets. Such a program would ideally require that EPC make asubstantial contribution to its capital requirements as well as coveringits routine costs of operation. For example, if EPC had been required tocontribute 40% of its capital requirements over the last five years,additional revenues of about WS$1.4 million p.a. would be indicated -- oran additional tariff component of US$0.06/kWh sold during the period.Therefore, the mission recommends technical assistance to EPC to analyzeits present and expected cost structure -- based on least-cost systemexpansior.. Thuq, it would be possible to determine EPC's financialrequirements, which would indicate appropriate tariff levels. The tariffstructare would also take into account other considerations such associal equity and energy conservation. For example, the desirability ofa demand charge or seasonal tariffs for the largest consumers to provide

331 1983 net operating losses amounted to WS4845,000.

- 34 -

proper signals for efficient use of capital and energy resources wouldalso be examined. This technical assistance should be a component of theintegrated power system operation and planning analysis recommended inparas. 3.25-3.27 and detailed in Annex 9.

Table 3.5: ESTIMATED EPC AVERAGE COSTS OF PRODUCTION, 1983(WSS per kWh Sold)

AverageDiesel Hydro Cost

Upol u Fuel 0.25 -

Other 0.14 0.14 -

Total 0.39 0.14 0.29

SavaI i Fuel O0V - -

(Salelologa) Other 0.22 -

Total 0.59 0.59

Source: Mission Est.mates.

Other Renewable Energy Options

Hot-air Generators

3.37 Most copra drying in Western Samoa is done by coconut husk andshells and some fuelwood. About 17% of total marketed copra is producedby WESTEC, which has a total of about 17 copra-driers; the balance isproduced by smallholders. 34/ Western Samoa has been particularlyinnovative in introducing its own local version of hot-air generator forcrop drying as opposed to the "open-fire"' method. Brugger Industries ofSamoa Ltd., located in Apia, specializes in the manufacture of biomass-fired hot-air/hot-gas generators which can be used for drying agroproducts such as copra and cocoa (Annex 7). This model operates on thedown-draft principle in which the producer gas is drawn through a fan andignited. Although there is a certain quantity of ash carried over intothe drying chamber, the quality of the dried product is much better thanthat achieved by the traditional open-fire method. 35/ Further, the highthermal efficiency of the Brugger system (about 70i3 results in a fuel-

34/ Pacific Energy Programme 1982.

35/ Quality improvement may be as much as US$20/tonne of copra at theproducer level.

- 35 -

wood consumption rate as much as seven times lower than that required byan open-fire method. The capital costs for a 500 kW drier are WS$30,000(WS$60/kW installed cost). A feedhopper, gasifier, fan, motor, ductingand the drying chamber is included in the above price. Fuelwood consump-tion for a 500 kW sized drier is about 400 lbs/hour and the temperaturedelivered to the drying chamber is about 120'C. The 500 kW unit dries3 tonnes of copra in 20 hours from 50% moisture to less than 5% moisture.Units of 50 kW, 100 kW and 300 kW are also available. The missionrecommends that WESTEC consider retrofitting its diesel-operated cocoadryers, which use an estimated 45,000 liters of diesel per dryer per yearwith hot-air generators of this variety.

3.38 CHOCRM is currently funding three demonstration projects whichinvolve retrofitting diesel-fired boilers to combust gas produced frombiomass residues at 3 sites in Upolu. 36/ The demonstration project willoperate through 1985 with the objective of performance evaluation,training, and dissemination of information as a preliminary step to aprogram of retrofitting industrial diesel-fired boilers. Although themission supports this project, it recommends that a technical assistancecomponent be included to guarantee proper design and implement theprojects, since Western Samoa has had limited experience in such retrofitprojects. 37/

3.39 In the mission's view, utilization of biomass to generateprocess heat in substitution for petroleum fuels is a proven techno-logy. Since gasifier/burners can be retrofitted directly onto existingboilers and dryers, this achieves the cost advantages of switching to abiomass fuel without replacing the entire heating system.

Biomass Gasification for Power Generation

3.40 The EEC has provided funds for a pilot biomass gasificationprogram in Western Samoa 38/ as a component of its regional program toinvestigate energy applications of biomass in the South Pacific. Theprogram will consist of installing and operating two 600 kW gasi-fier/diesel systems for rural electricity generation. The gasifiers willuse coconut husk and shell as the fuel feedstock to produce gas to powerthe diesels. The project is to be operated by EPC, which is still

36/ Westec soap factory; Samoa Tropical Products coconut cream factory;and two of the Cocoa Board's remaining diesel-fired dryers at atotal estimated cost of A$123,000.

371 Selection of appropriate gasifers/burners is of special concern ascertain systems can produce only hot gas or hot air, whereas aradiant flame is needed for optimum efficiency in retrofittingboilers, kilns, etc.

38/ Estimated costs of US$2.0 million.

- 36 -

investigating site location, availability of feedstock, management andoperational schemes. The mission has reservations about the systemsize 39/ and is of the opinion that gasifier-diesel systems of a maximumcapacity of 300 kW would be more appropriate for the stated objectives ofdemonstrating and evaluating equipment reliability and availability.

3.41 Estimated costs of the pilot project are about US$2.0 million,which is a significant investment for a small island country like WesternSamoa. Therefore, every effort should be made to ensure smooth implemen-tation and operation of the project. Several factors should be kept inmind: (a) although coconut shells are a promising alternative to woodand charcoal as a gasifier feedstock, operating experience is limited andthe fuel should be regarded as still experimental; (b) servicing require-ments and replacement needs of gasifier components must be taken intoconsideration; and (c) gasification is a relatively sophisticated tech-nology and good operating procedures and skilled manpower are necessaryin the interests of safety. 40/ Therefore, and in view of WesternSamoa's lack of experience with engine gasifiers (as opposed to hot-airgasifiers), the mission recommends that sufficient qualified manpower andoperational expertise be provided as a component of the pilot project toassist EPC in operating, monitoring and evaluating the gasifier's perfor-mance (Annex 9).

Coconut Oil for Power Generation

3.42 Some years ago, when coconut oil prices were very low, substi-tution of coconut oil for diesel oil in engine operation in rural areaswas actively promoted. EPC has already held a six-month trial usingcoconut oil for power generation on a small diesel engine generatorset. Major problems evolved concerning the necessity for frequent oilfilter changes due to fatty acids in the coconut oil.

3.43 In the mission's view, although world prices for coconut oilfluctuate in relationship to the U.S. soya bean crop price, currentprices for coconut oil and diesel oil preclude any large scale substitu-tion and this is likely to be the case in the foreseeable future.Assuming a Pacific f.o.b. price of about US$450 per tonne for coconutoil, comparison with c.i.f. diesel cost of about US$300 per tonne indi-cates that coconut oil has a high opportunity cost. Therefore, and inview of EPC's other commitments requiring skilled manpower, the missiondoes not recommend further experimentation with coconut oil at this time.

39/ In view of the disappointing performance record for systems muchlarger than 200 kW.

40/ Although Western Samoa currently produces and operates gasifiers forprocess heat purposes, gasification for power generation is arelatively new concept.

- 37 -

Charcoal Exports

3.44 WESTEC is currently considering a proposal to establish a cen-tral coconut processing facility. 41/ The objective would be to achievebetter use of currently unde itilized by-products (husk, shells andstems) by incorporating facilities to produce coconut shell charcoal andactivated carbon for export. According to WESTEC's preliminary esti-mates, coconut based charcoal could fetch up to US$1,600/tonne inAustralia, and coconut-based activated carbon US$5000/tonne in the U.S.A.

3.45 In principle, utilization of underutilized coconut by-productsto make export-targeted charcoal and activated carbon, makes economicsense. However, processing and marketing aspects should be closelyexamined. In the mission's opinion, regional charcoal prices are muchcloser to US$300/tonne than US$1,600/tonne. Second, although activatedcarbon does retail for up to US$4,000 in the USA, it has to meet verytight consumer product specifications and its demand fluctuatesconsiderably with the economy. Other questions to be considered are(a) whether WESTEC would be able to obtain a long-term market contractfor its exports; and (b) failing such a contract, whether a domesticmarket exists and what domestic price levels would prevail. Therefore,the mission recommends that WESTEC should exercise considerable cautionin this matter until confident assumptions can be made about the tech-nology, markets and prices.

The Role of Solar Energy

3.46 Western Samoa is located in a region with abundant sunshine.The mission estimated that most parks of the country receive an annualaverage insolation of over 5.0 kWh/m . Currently, this resource has twomain applications: (a) solar water-heating as a substitute for electri-city or petroleum; and (b) photovoltaic (PV) systems for rural lightingand telecommunications.

3.47 Solar Water Heaters. The two major hotels in Apia haveconverted their water-heating systems from electricity to solar energy.This investment will reduce peak demand on the EPC grid system, thusreducing both fuel and capacity costs. 42/ In a preliminary analysis ofsolar water heating benefits elsewhere in the Pacific region, the missionconcluded that simple payback periods of two years and substantial annualdiesel savings (e.g. 8,000 liters/year/hotel) could be assumed for

41/ At present, each of the ten coconut plartations has its ownprocessing facilities.

42/ The mission was informed that many private residences have alsoinstalled solar water heaters.

- 38 -

modest capital investments of, say, US$10,000. 43/ Solar energy couldalso be used for heating requirements in industrial processes, commercialbuildings and other institutions. Thus, the mission supports the currentproposal for Apia Hospital to convert to solar energy for its hot waterneeds.

3.48 Photovoltaics. There is a possibility that solar energy couldbecome a commercially viable source of public power supply in the futurefor countries such as Western Samoa. Table 3.6 below shows the monthlyinsolation values.

Table 3.6: MONTHLY INSOLATION VALUES

(kWh/m )

Month Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

Insolation 4.82 5.15 5.08 4.96 4.89 4.95 5.34 5.81 5.74 5.38 4.90 4.79

Source: Mission Estimates.

3.49 As shown, the yearly average insolation is about 5.15 kWh/m2

which is adequate for deploying solar photovoltaic systems. One long-term possibility would be a grid interface with the public powernetwork. Annual PV output in the Western Samoa climate is estimated toequal 1.6 kWh per peak watt of PV array, or 32 kWh during a 20-year life-cycle. The installed cost of a PV system is dependent on its size.Discussions with PV system manufacturers indicate that a 1 MW grid-interfaced system could be installed at a cost of US$8.0/peak watt. 44/This translates into about US$0.45/kWh of electrical energy cost.Although this generation cost is, at present, high compared to dieselgeneration (US$0.30), such a possibility should be kept in mind forfuture reference when the capital costs of the PV system come down fromtheir current levels.

3.50 EPC is expecting a WS$15,000 grant from France for the purchaseof a photovoltaic system comprising solar panels, lights and an 8 cubicfoot refrigerator for a rural hospital on Upolu. This should provideexperience in operation and maintenance of PV systems. The missionrecommends that COWS also monitor the performance of pilot solar PVsystems to be installed under the EEC Regional Programme in other Pacificcountries before making a decision about the extensive use of similarsystems for rural energy purposes.

43/ "Tonga: Issues and Options in the Energy Sector."

44/ Assuming 10Z p.a. interest rate.

- 39 -

IV. END=Y INSTITUrIONS AND TECHNICAL ASSISTANCE

Energy Planning and Admininstration

4.1 The energy sector of Western Samoa is relatively well organizedand progressive (paras. 4.2-4.5). The main task of the recentlyappointed Energy Planner (funded by ADB) would be to act as liaisonbetween the various energy sector agencies and to develop an eneroysector strategy within the national economy context. It is importantthat local counterparts for the Energy Advisor be identified and re-cruited so as to provide continuity in the long term.

Electric Power

4.2 EPC was established by the 1972 Electric Power Corporation fictas an autonomous body governed by its Board which is answerable to GOWS.The Board is currently dominated by COWS representatives. 451 TheCeneral Manager of EPC is also directly appointed by COWS. In themission's view, Board membership should be modified by replacing someCOWS representatives with qualified outsiders from specific consumergroups who could contribute to the management of EPC. This nodifiedBoard should also have the authority to appoint the General Manager ofEPC.

4.3 EPC has provided reliable power supply and is a well-managedutility. Three top management positions, including the EPC Ceneral Man-ager, are currently held by expatriates. Middle management positions Andthat of Chief Accountant are held by Samoan nationals. EPC's significanttraining effort includes both overseas training courses and regular in-house training. However, pressures of routine operational requirementshave inhibited training work. Long term system analysis and planninghave also been affected. The mission supports EPC's request for tech-nical assistance in evaluating its Upolu diesel capacity. The missionfurther urges that technical assistance be provided to EPC in formulatingits least-cost power development strategy for both Upolu and Savaii(paras. 3.25-3.27, Annex 9).

Forestry

4.4 The Forestry Division of the Department of Agriculture,Forestry and Fisheries (DAFF) handles the woodfuel aspects of the energysector i.e.. reforestation programs; forest research; community foresty;and national park management. Organization and management of the ForestDivision is based on a Head Office in Apia and three Regional Offices

45/ The Minister of Public Works (Chairman), the Director of PublicWorks, the Finance Secretary; the Director of Economic Development;and three consumer representatives appointed by Cabinet.

- 40 -

(one on Upolu and the other two Savaii). Forestry extension services areprovided through the Community Forestry Section of the Division withemphasis on creating public awareness of the value of the national forestresource; encouraging village afforestation projects and developing agro-forestry systems suitable for Samoan conditions.

4.5 The Forestry Division is generally well organized and isachieving progress in its projects. It has received considerabletechnical assistance and training support from bilateral and multilateralagencies. 46/ For example, there are four Samoans undergoing degreelevel studies and five others undergoing diploma level studies inforestry at overseas institutions. At the domestic level, there is anongoing program for strengthening the Forestry Division with support fromthe New Zealand Forest Services. 47/

Other Responsibilities

4.6 Prior to October 1984, importation of petroleum products wascarried out on an individual basis by the three oil companies operatingin Western Samoa (British Petroleum, Mobil and Shell) who were also re-sponsible for onshore storage and distribution. However, COWS has nowconsolidated the national petroleum import requirements into one contractso as to reduce procurement and transport costs. 48/ The mission sup-ports this new arrangement whereby one supplier is responsible for theimportation of products and no changes need to be made in internalmarketing and distribution arrangements.

Implications for External Assistance

4.7 Western Samoa continued to receive financial and technicalassistance from multilateral and bilateral sources over a wide range ofenergy fields, as shown in Annex 8. Since many of the ongoing programsare regional, spread over several South Pacific countries, the overallcontribution and impact on Western Samoa's energy situation is not yetcertain. Therefore, the mission has focused on those energy aspects thatrequire further detailed technical assistance (Table 1 and Annex 9). Themajor energy investment requirement will be for a proposed WFPS (estim-ated at about US$11.0 million) which is to be financed jointly by NewZealand, Kuwait and Saudi Arabia.

46/ Especially the New Zealand government, ADB, FAO/UNDP, the World Foodprogramme, and the International Union for the Conservation ofNature.

47/ Two New Zealand foresters are on full-time assignment in WesternSamoa.

481 The first two-year contract has been awarded to Shell.

Annex 1

ENERGY BALANCE PROJECTIONS, 1990('000 toe)

SenileAgricultural Coconut Total Total

Fuelwood Residues Steewood Blomass Hydro Electricity Petroleum Energy

Petroleum SuppliesProduction 25,80 42.18 14,04 82,02 5,50 - - 87.52Imports - - - - - - 26.00 26.00Bankering - - - - - (3,09) (3.09)

Total 25.80 42.18 14,04 82.02 5,50 - 22.91 110,43

ConversionPublic Power Generation (1,65) a/ - (14,04) (15,69) (5.50) 22,44 (1.23) -

Losses/Station Use (19,30) - (19,30)Trans/Dist. Losses - -- - - -

Not Supplies 24.15 42,18 - 66.33 - 3,14 21.66 91.13

Final ConsumptionDomestic 22,55 10.02 - 32.57 - 0.65 1,54 34.76

Transport - - - - - 18,20 18.20Commercial 1,2 - - 1,20 - 1,57 0.07 2.84

Industrial - 4.84 - 4.84 - 0,8 1,18 6,82Crop Drying 0.4 27.32 - 27.72 - - - 27.72

Others - - - - - 0,12 0.67 0,79

a/ Fuelwood from dedicated 640 hat plantation.

Source: Mlsslon estimates,

Annex 2

ENERGY BALANCE PROJECTIONS, 1995

(000 toe)

Senilo

Agricultural Coconut Total

Fuelwood Residues Stemwood Ciomass Hydro Electricity Petroleum Total Energy

Prlmary Supplles

Production 29.10 43,39 17,20 89,69 5.75 - - 95,44

Imports - - - - - - 32,51 32,51

Bunkerlng - - - - - - (3.76) (3.76)

Total 29.10 43.39 17,20 89,69 5.75 - 28.75 124,19

ConverslonPublic Power Generation (3.7) - (17.20) (20.90) (5,75) 29,28 (2,63) -

Losses/Station Use - - - (25,22) - (25,22)

Net Supplies 25,40 43,39 - 68.79 - 4,06 26.12 98,97

Final Consumptlon

Domestic 2.1,70 10.53 - 34.23 - 0.84 1,67 36,74

Transport - - - - - - 22,18 22.18

Commerce 1,30 - - 1.3 - 2.03 0,08 3.41

Industry - 4.84 - 4.84 - 1.03 1.40 7.27

Crop Drying/Agro Processing 0.40 28.02 - 28.42 - - - 28,42

Other - - - - - 0.16 0.79 0,95

a/ Fuelwood from dedicated 640 ha, plantation,

Source: Misslon estimates.

- 43 -

Annex 3

EPC GENERATING PLANT IN SERVICE, END 1983

Nameplate LocationDesignation Rating Capacity Derated Conmissioned Year

(kW) (kW)

Diesel- Upolu

Number 2 273 200 Savalalo 1955Number 3 532 400 Fuluasou 1962Number 4 1 672 1 200 Tanugamanono 1966Number 5 1 672 1 200 Tanugamanono 1966Number 6 1 456 1 000 Tanugamanono 1973Number 7 1 800 1 200 Tanugamanono 1979

Number 8 1 a0m 1 200 Tanugamanono 1979Number 10 300 250 Fuluasou 1978Number 11 300 250 Fuluasou 1978

9 805 6 900

Hydro-Upol u

Fuluasou 230 230 Fauluasou 1951Alaoa 1 000 I 000 Alaoa 1959Fale-ole-Fee 1 600 1 600 Alaoa 1982Samasoni 2 x 900 2 x 900 Lotosamasoni 1982Subtotal 4 630 4 630TOTAL Capacity Upolu

Island 14 435 11 530

Diesel - Salelologa

Salelologa No. 1 100 100 Salelologa 1978Salelologa No. 2 100 100 Salelologa 1978Salelologa No. 3 100 100 Salelologa 1982

Salelologa No. 5 60 60 Salelologa 1982Salelologa No. 6 60 60 SaIelologa 1982

Total Capacity

Salelologa System 420 420

Total Capacity BothIslends 14 855 !1 950

Source: EPC.

- 44 -

Annex 4

UPOLU: EXPECTED GENERATION CAPABILITY (including spill)OF THE FULUASOIJ, SAMASON I ALAOA AND FALE- OLE-FEE HYDROPLANTS

(GWh per year)

Year of Mean Rainfall Dry Year (1983)

Month Alfoa Rainfall Month Alaoa Rainfall

(GUh) (mn) (GWh) (an)

Jan 2.471 579.1 Jan 1.886 316.8

Feb 2.471 452.2 Feb 1.320 142.0

Mar 2.393 525.6 Mar 1.509 177.6

Apr 2.265 301.2 Apr 1.313 118.7

May 1.702 223.3 May 0.996 37.9

Jun 1.210 171.8 Jun 0.569 67.1

Jul 0.970 142.0 Jul 0.646 53.8

Aug 0.772 143.1 Aug 0.566 61.9

Sept 0.872 188.1 Sept 0.342 28,8

Oct 1.029 343.6 Oct 0.715 87.5

Nov 2.604 382.7 Nov 0.666 217.7

Dec 2.236 546.0 Dec 1.495 945.4

Total 19.995 Gwh 3998.7 mm Total 12.023 Gwh 2255.2 mm

The flow variability at the new Sauniatu hydro plant (under construction) is

expected to be somewhat less than at the existing stations.

Source: EPC.

Annex 5LOAD FORECAST UPOLU, 1984-2000

LOAD GROWTH PER YEAR

2.5 Percent 5 Percent 7.2 PercentEPC Forecast

kWh Losses kWh Load Peak kWh kWh Peak kWh Peak

Sold (1- Generated Factor Demand Sold Generated Demand Generated Demand

Year (000) percent) (000) (percent) (kW) (000) (000) (kW) (000) (kW)

1983 25169 25169

1984 25798 ,81 31850 0.62 5864 26427 32626 6007 31700 5837

1985 26443 .8125 32545 0,62 5992 27749 34152 6288 33600 6186

1986 27104 .815 33257 0,62 6123 29136 35750 6582 36100 6647

1987 27782 ,8175 33984 0.62 6257 30593 37423 6890 38900 7162

1988 28476 .82 34727 0,62 6394 32123 39174 7213 41800 7696

1989 29188 ,8225 35487 0,62 6534 33729 41008 7550 44900 8267

1990 29918 .825 36264 0.62 6677 35415 42928 7904 48300 8893

1991 30666 ,8275 37059 0,62 6823 37186 44938 8274 51900 9556

1992 31433 .83 37871 0,62 6973 39045 47043 8662 55800 10274

1993 32218 .8325 38701 0.62 7126 40998 49246 9067 60000 11047

1994 33024 .935 39550 0,62 7282 43048 51554 9492 64500 11876

1995 33850 .8375 40417 0.62 7442 45200 53970 9937 69300 12760

1996 34696 .84 41304 0,62 7605 47460 56500 10403 74500 13717

1997 35563 ,8425 42211 0.62 7772 49833 59149 10891 80100 14748

1998. 36452 .845 43139 0,62 7943 52325 61923 11401 86100 15853

1999 37364 .8475 44087 0,62 8117 54941 64827 11936 92500 17031

2000 38298 .85 45056 0,62 8296 57688 67868 12496 99500 18320

Source: EPC; Mission Estimates.

Annex 6

LOAD FORECAST SAVAII, 1984-2000

EPC Forecast Alternative Forecast

kWh Peak Losses kWh Load Peak

Generated Demand kWh Growth/ 1- Generated Factor Demand

Year (000) (000) Sold Year (percent) (000) (percent) (kW)

(000) S

1983 814 .05

1984 2510 810 855 ,25 ,775 1103 .36 350

1986 3520 1165 1309 ,2 ,785 1667 .38 501 1

1987 3950 1310 1571 ,175 .79 1988 ,39 582

1988 4250 1386 1845 .15 ,795 2321 ,4 662

1989 4570 1491 2122 ,125 .8 2653 ,41 739

1990 4910 1557 2387 ,1 ,805 2966 ,42 806

1991 5280 1674 2626 .09 .81 3242 .43 861

1992 6310 2000 2863 .08 .815 3512 .44 911

1993 6780 2091 3092 ,07 ,82 3770 .45 956

1994 7290 2249 33'8 .06 ,825 4010 .46 995

1995 7840 2355 3506 ,05 ,83 4225 .47 1026

1996 8430 2532 3682 .04 ,835 4409 .48 1049

1997 9060 2722 3829 ,03 ,84 4558 ,49 1062

1998 9740 2851 3944 .03 ,845 4667 .5 1066'

1999 10470 3065 4062 ,03 .85 4779 I5 1091

2000 11260 3213 4184 ,85 4922 ,5 1124

Source: EPC; Misslon Estlmates.

- 47 -

Annez 7

SPECIFICATIONS OF A BRUCCER COPRA DRIER

Burner Unit

Type: Biomass GasifierOutput: (Max)L 500 kWRange: 75-500 kWFuel Consumption: 20-135 kg/hrFuel: Coconut shell, husks with shell or wood

Drying Fan

Output: 230 m3/min at 75 mm waterTemperature: 65-140 C (operator controlled)Motor: 12 HP gasolineGasoline Consumption: 1.5 liter/hour

Drying Chamber

Drying Volume: 16.5 m3Bed Area: 14 m2Drying Capacity: 3 TonneDrying Time: 20 hoursAir Flow: Adjusted with dampers.

Annex 8

ONGOING TECHNICAL ASSISTANCE ACTIVITIES Pago I of 2

Agency Date Cost Description

(5000)

Subsector PlanningPacific Energy DevelopmentProgram Late 84 NA Electricity Authority Legislatlon:

To advise power legislation as required.

New & Renewable EnergyCHOGR9 Mid 83 - 85 ASIIS Biomass Burners/Hot Air Generators:

Installatlon of 3 demonstration projects followed by aworkshop to review performance of these projects and plan futureactivities,

European Economic ICommunity End 84 ECU2040 Power Gasifier: Supply and Installation of a large

gasifier/dlesel power system

CHOGRM Mid 84 NA Coconut Ol as Diesel Fuel:Trials will be carrled out on the use of coconut oil as fuel fora diesel power generator.

Pacific Energy DevelopmentProgram Late 84 NA Woodstoves: Advice on construction of woodstoves for

domestic use.

Pacific Energy DevelopmentProgram Mid 84 NA Solar (Photovoltaic) Energy:

Assess the relative costs of using photovoltaic systems forrural lighting.

South Pacific Commission Mid 84 NA Photovoltaic Applications: Supply and Installation of solarphotovoltaic systems for lighting, medical refrigeration and forwater pumping for a hospital In one of the rural villages.

New Zealand Government Late 84 NA Solar Radiation: Supply and Installation of solarimeter(s)for monitoring solar radiation.

Annex 8Page 2 of 2

ONGOING TECHNICAL ASSISTANCE ACTIVITIES(continued)

Agency Date Cost Description

(SOOO)

Pricing/Tariff StudyPacific Energy DevelopmentProgram (PEPO) Early 83 NA Petroleum Pricing and Supply: Consultant reviewed prevailing

situatlon and advised Government on alternative petroleum supplyand pricing options.

Training & Manpower PlanningCenter for TransnationalCorporation (CFTC) Jul 83 NA Training Course on Energy Planning:

Western Samoa was also represented at this course In Novemberlast year.

ESCAP-6 Nov 83 NA Petroleum Supply/Pricing - Training Workshop:Western Samoa was also represented at this course In Novemberlast year.

CHOGRM-4 Mid 85 NA Workshop In Coconut Oil as Diesel Fuel: Western Samoa will beInvited to be represented at this workshop scheduled around mid85.

Institutional DevelopmentAsian Development Bank Mid 84 NA Energy Planner: Resident expert support to organise the Energy

Planning Unit and set In motion the national energy planningprocess,

Source: South Pacific Bureau for Economic Cooperation (SPEC).

- 50 -Annex 9Page 1 of 4

PRIORITY TECHNICAL ASSISTANCE REQUIREMENTS

A. Regional Analysis of Petroleum Product Procarement and Supplies inthe South Pacific.

The principal objective is to develop a least-cost strategy forthe supply and distribution of petroleum products in the islandcountries of the South Pacific while maximizing the economic utilizationof existing facilities and infrastructure and retaining the currentsecurity of supply. The regional analysis would cover the six Pacificisland countries that together account for over 95X of regional petroleumconsumption: Western Samoa; Fiji; Papua New Guinea, Solomon Islands;Tonga; and Vanuatu. The main components of the task include:

(a) review and examination of current supply and transportarrangements, commercial contracts and the findings of theprevious studies;

(b) identification and evaluation of possible least cost supply andtransportation options, including:

(i) purchasing refined products for combined requirementsdirectly from a refinery in Singapore, Bharain or Australia;

(ii) seeking bids from established majors to supply combinedrequirements of participating countries; and

(iii) identifying and establishing least cost transportarrangements.

(c) recommending a least-cost combination of procurement andtransport arrangements and logistics;

(d) define medium-term technical assistance and trainingrequirements, to enable government agencies to implement andsupervise petroleum procurement responsibilities.

Duration of the project would be about 6-9 man-months, and the estimatedcost, including supervision, would be $70,000.

B. EPC Power System Operation and Planning

EPC requires technical assistance in four categories:(i) improvement of present generation facilities; (ii) systems lossreduction; (iii) least-cost power development program; and (iv) tariffreview and modification. All four categories are interrelated: forexample, loss reduction could affect net demand on generation capacityand improved diesel operations could increase available capacity, thusaffecting the scheduling or perhaps even the choice of the nextgeneration project.

- 51 -

Annex 9Page 2 of 4

1. Upolu Power System

(a) Review the load forecast prepared by EPC and preparealternative forecasts for long term planning purposes.

(b) Determine the causes of the significant de-rating applied byEPC to the nameplate rating of its diesel engines. Recommendchanges in facilities and operating and maintenance jracticesif considered desirable.

(c) Review and evaluate existing information on hydro potential andfeasibility studies of hydro-projects.

(d) Based on (d) above, develop a least-cost expansion program con-sidering reliability, alternative load forecasts, risk of notmeeting the load or of surplus capacity, the cost of short termadjustments which might become necessary, incorporating theresults of the analyses of the existing diesel and hydrocapacity; and including review and evaluation of the relativepriorities of the various schemes under consideration.

Ce) Prepare an investment plan associated with the least-costexpansion plan.

(f) Analyze EPC's present and expected cost structure (based on theleast cost expansion plant) and financial requirements andrecommend an appropriate tariff structure, also consideringaspects such as social equity and energy conservation: assessthe desirability of introducing a demand or time of day/seasonal tariff for a few large consumers.

Cg) Recommend a program for further investigation of hydroresources on Upolu, considering the need for hydrologic surveyprograms.

Ch) Prepare Terms of Reference and cost estimates for any furtherstudies or support programs, including training programs, whichare considered necessary or desirable on the basis of thestudies performed.

- 52 -

Annex 9Page 3 of 4

2. Savaii Power System

(a) Review the current expansion program based on interconnectionof the Asau and Salologa system and use of surplus power at theAsau sawmill.

(b) Review EPC's load forecast for the island and prepare alterna-tive forecasts for planning purposes.

(c) Estimate the likely surplus power to be delivered by the saw-mill and assess the reliability of supply considering themethod of operation of the sawmill, its wood supply, its ownrequirements for power and steam and the conditions of theboiler, turbine and associated facilities.

(d) Assess the technical and economic feasibility of upgrading orpartially replacing facilities at the sawmill to increasereliability of supply in view of the economics of the saw milloperation and the cost of stand-by diesel capacity and itsassociated energy costs required by EPC.

(e) Assess the operation and maintenance requirements of facilitiesat the sawmill and determine whether the steam and power faci-lities should be operated by EPC or the sawmill.

(f) Recommend a specific investment program for EPC in view of thepreceeding analyses.

(g) Analyze the current tariff structure on the island and recom-mend modifications as desirable in view of the recommendedexpansion program; assess also the desirability of applying ademand or time of day tariff to a limited number of customers.

(h) Recommend a program of surveys and project identification ofhydra resources on the island, and possibly of biomassresources, in view of the projected demand - supply balance andcosts of operation.

(i) Prepare Terms of Reference and cost estimates for any furtherstudies or support programs, including training programs, whichare considered necessary or desirable on the basis of thestudies performed.

Estimated Cost: US$200,000 over a period of 12 man-months. Thispower sector analysis should be carried out by an internationallyrecognized power consulting firm.

- 53 -Annex 9Page 4 of 4

C. Biomass Gasification Demonstration Projects

Western Samoa is to carry out two demonstration projects in thefield of biomass gasification as a substitute for diesel: (i) a CHOGRM-financed project involving the retrofitting of three industrial diesel-fired boilers to combust producer gas from biomass residues and (ii) anEEC-financed project to investigate the technical and economicfeasibility of biomass gasification for rural electrification. Technicalassistance in implementing and operating both projects would bebeneficial since Western Samoa has relatively little experience in theretrofitting of boilers or the power generation aspects of gasification.

Estimated Costs are US$30,000 for two man-months.

172n40' 172'20'

Foleolupoiol

~~~~~~~~~~~~M /~J ,10 9 09 _,__

13040 /\\ fw

< _g>_ Solciologo

Apolirno kloncl

MonN eia

34072040

JAPAN

Sol iluW

FPAPUA X IRIIIATINEW GUINEA

i SOLOMON S5 TUVAIU

WESTFPN f

VANUATU FUI 0 5 10 Miles -CAloNEW TONGA _ I

SIRALIA CA0OI 4 8 12 16 Kilometers

I S~~~~~~EW ZEALAN D

172°20'

L _~~~~~~~~~~~~~~~~~~~~~~~..

IBRD 18-

172 00 171 40'

WESTERN SAMOAENERGY RESOURCES

* Existing Diesel Stations Paved Roads- Existing Hydro Stations Improved Roods

Potent.aI Hydra Stations Plantation RoadsHighlonds over 1,000 feet .......... Unimproved Roads

A Wood-fired Steam Turbogenerator Ferry

t Airport

Fivers

- In.crnotionol Boundaries

13 4C'

Mole FaI .l/u

Fdeosi ss ; ~~~~~Plant

Leulumoogo / i < _wV ~~APIA

3 vo~~~ipop°0a -}T-

j ( Lepole 3 Plants? A /> oUtumopu i qol Folefo Folls>> _ F § gTonvmolalA _5p^f-

~ Fulevol r l ~ , / ~ OSoleteleMT. FIAMOEf & Mr V41T0A Soo0( Mr OF vb, ^ M7 V^IA S~~soobuo g Musumusu

.. , \\ ~~~U P O L U ,/> .. 0'. H < 1 ree (_) _ Wz~~~~~~~~~~~~~~Uaato

u AS~~~~~~~~~~~~~oo'aga Fall 1'

/~~~~~~~~~51iu /POL

Lotofca FilCpe Tapo,

v--' -. d d 1 5 VS U'0 .'gr',. u'' o' Th' htoC1 (0.0'. .Jd U''mP :0'o,l.fil*=_-.... . Co'D'.&., TVn. d0'0,0'Ion :o..'d an IS." Iuo.'ni.'.' c . 1 00.vs 0,n. GID A.

:n _:o.* D -- ld rr Jl.r I tw,ca CpaI- rv 'm

172 00' 171 40'

JMLIARY i*5