Kiribati includes one raised coral island (Banaba) and 32 atolls in three island groups (Gilbert, Line and Phoenix) with a total land area of 811 km2. Electrical and petroleum energy are dominant in Tarawa and Kiritimati, while in the outer islands most energy is from biomass and solar energy. The Public Utilities Board (PUB) on Tarawa is the main electricity provider. The on-grid access to electricity is 87 percent on Tarawa, 75 percent through multiple small grids on Kiritimati and 54 percent on the Outer Islands. The Outer Islands’ electricity is mostly from solar off-grid system and a few generators supplying Community facilities. Kiribati has no conventional energy resources. Its large dependency on imported fuel oil makes it vulnerable to fuel price volatility. Diesel fuel oil accounts for about 60 percent of the energy supply. The Government of Kiribati is very aware about environmental degradation and seeks to develop renewable energy.
34% of Kiribati's outer island homes rely on solar lighting, and this number is likely to increase as CIF projects are undertaken there.
Kiribati have been focused mainly on solar energy while the use coconut oil (CNO) as an alternative fuel has been developed. CNO as biofuel will potentially curb fossil fuel usage for transportation, which presently consume more than 50 percent of the annual fuel imports. However, there are technical issues in using CNO biofuels due to a lack of information about the specifications required of the product, and the type of equipment needed for its refining and quality control.
The proposed project for SREP financing will focus on CNO for Biofuel use in both the power and transport sector through a budget estimated at Australian $4 million. SREP will prepare a CNO implementation plan showing specific actions, timelines necessary to develop CNO as a diesel fuel replacement. It will help Establish fuel standards and a testing facility for CNO based biofuel. Furthermore, mobile copra mills will be developed on Kritimati and Tarawa that can be managed by local operators to avoid the high cost of transporting coconuts from plantations. SREP will procure an electric power generation (genset), designed for use with CNO for base load generation for Tarawa and for Kiritimati power generations.