Energy Fiji Limited says improvements are needed in its annual reports after concerns were raised over transparency, generator hire costs, capital expenditure performance, dividend disclosures and the quality of information provided to the public.
These concerns were highlighted during the Submissions made by EFL on the Standing Committee on Economic Affairs’ review of EFL’s 2023 and 2024 Annual Reports.
Energy Fiji Limited CEO Fatiaki Gibson says EFL had already provided project timelines, costs and implementation plans to the Fiji Competition and Consumer Commission as part of its tariff review submission, and these details will be reflected more clearly in future annual reports.
Parliamentary Committee Deputy Chair Premila Kumar raised concerns that key information discussed during the hearing was not clearly reflected in EFL’s annual reports.
Kumar says the payment of dividends in 2023 could be misleading to readers, as it could suggest that EFL paid dividends despite making a loss in 2023, without clearly explaining that the dividends were based on profits earned in 2022.
Insert: Kumar on backlash 23rd June.
EFL Manager Financial Services Shalend Prasad says EFL’s dividend disclosures, saying 25 of the annual reports clearly showed that the $40.68 million dividend paid in 2023 was based on 70 percent of after-tax profits earned in 2022.
However, Kumar says the information was not clearly presented for the average reader and should be explained more clearly in the narrative sections of the report.
Kumar also questions EFL’s capital expenditure performance, referring to underspent capital expenditure over several years, including $42.6 million in 2019, $52.5 million in 2020, $100 million in 2021, $101 million in 2022, $55 million in 2023, $81 million in 2024 and $151.85 million in 2025.
She says these figures explain public concern and the caution shown by the Fiji Competition and Consumer Commission whenever tariff increases are considered.
Kumar says annual reports should clearly outline project budgets, timelines, targets and reasons for delays so the public can better understand tariff and renewable energy decisions.
Standing Committee on Economic Affairs Chair Sakiusa Tubuna questions EFL’s decision to spend about $31 million on generator hire in one year, while raising concerns over the status of renewable energy infrastructure, including issues affecting the Nadarivatu Hydro scheme and the Butoni Wind Farm.
Gibson says Fiji has no option but to accelerate its transition to renewable energy, and EFL remains committed to supporting the national target of reducing dependence on fossil fuels.
He says the Nadarivatu Hydro facility has been affected by water pressure and flow issues involving arrangements between EFL and the Water Authority of Fiji.
Gibson says discussions are ongoing to resolve the matter, including the possibility of a new pipeline to allow continuous operation of the plant.
He says the Butoni Wind Farm sustained extensive damage during Cyclone Winston in 2016 and is now being rebuilt after insurance settlements.
Gibson says EFL intends to integrate a solar plant with the wind farm to create a hybrid generation system to improve supply to the grid.
He says the decision to hire generators in 2023 was made due to a shortage in generation capacity as dam water levels declined, creating a risk of not meeting electricity demand.
Gibson says the hired generators were returned in 2024 and EFL instead purchased generators, which he describes as a more financially prudent decision.
Kumar questions why about $52 million had been spent over two years on generator hire when purchasing generators appeared to be more cost-effective.
Replying to Kumar, Gibson says a cost-benefit analysis had been carried out and purchasing generators was considered the better long-term option.
He says containerised high-speed generators cost about $500,000 each, and EFL purchased 50 megawatts of generation capacity for approximately $25 million.
Kumar says Fiji’s energy mix remains approximately 50 percent renewable and 50 percent fossil fuel-based, and raised concern that fuel consumption is increasing rather than decreasing.
She says the generator hire decisions reflected what she described as a firefighting situation and raised concerns about planning, urging that future decisions be made in advance to avoid unnecessary costs.
Gibson says suitable land is being identified for major solar developments in areas including Rakiraki and Yaqara, and consultations are ongoing with landowners to advance future projects.
He says securing land, engineering solutions and funding remain key challenges in renewable energy development.
Kumar says while she understands the challenges, EFL needs to improve how it communicates project progress and challenges in its annual reports.
Kumar also questions the benefits Fiji has received from Pacific Energy, which holds a 44 percent stake in EFL, particularly in relation to renewable energy development.
Gibson says the shareholder’s technical expertise is beginning to support the renewable energy transition through embedded specialists within the organisation, with further expertise expected to be introduced over time as the partnership develops.
