Appendix I. Currently Identified Priority Investment List with Climate-Proofing Component
| Project | Donor | Project Cost, Financing & Status | Description |
| A. Energy sector | |||
| Tina River Hydropower Project (TRHPP) | ADB, WB, Bilateral (Australia, Korea) | - $233.37 mil. In PPP (Built-Operate-Transfer) - Loan: 66.8%, Grant: 21.2% - New ongoing (2019–2025) | Develop renewable energy source. Build 15 MW hydro power plant for electricity supply in Honiara; CO2 reduction (49.500 tons/year) and tariff reduction expected. |
| Solar Power Development Project | ADB | - $13 mil. - Grant: 56%, Budget: 44% - Almost completed (2016–2022) | Develop renewable energy source. Generate 2 MW grid-connected solar power in Kirakira, Lata, Malu’u, Munda and Tulagi. |
| B. Transport sector | |||
| Transport Sector Flood Recovery Project (TSFRP) | ADB | - $13.2 mil. - Loan: 50%, Grant: 50% - Completed (2014–2018) | Restore more resilient transport connectivity after the Cyclone Ita. Reconstruction of bridges and roads in Honiara/ Guadalcanal provinces |
| Sustainable Transport Infrastructure Improvement Program (STIIP) | ADB, Australia | - $25.5 mil. - Loan: 82%, Grant: 18%) - Almost comleted (2016–2021) | Improve nationwide (rural and urban) transport system through rehabilitation and maintenance, strengthen climate and disaster resilience of road |
| Land and Maritime Connectivity project | ADB | - $150 mil. - Loan: 50%, Grant: 50% - New ongoing (2021–2028) | Rehabilitating/upgrading of 35 km roads near Honiara and upgrading ports/wharfs in Honiara, Ahanga, and Kira Kira. Objectives are to boost transport (land and maritime) connectivity, efficiency, and disaster resilience of transport network. |
| Road and Aviation Project (SIRAP) | WB | - $51 mil. - Loan: 60%, Grant: 40% - New ongoing (2019–2024) | Improve air transport and strengthen the climate resilience of roads |
| Upgrading of Kukum Highway | JICA | - 3.2 bil. Yen (=$29 mil.) - Grant: 100% - New ongoing (2021–2023) | Improve logistics improvement, disaster prevention and traffic safety through upgrading of Kukum highway in Honiara |
| Costs of new ongoing projects | Total cost: $463.37 mil (=15.2 percent of 2030 GDP) Annual average project cost: $85.02 mil (=2.8 percent of 2030 GDP); of which external loans-financed cost is $42.82 mil (=1.4 percent of 2030 GDP)) | ||
| Project | Donor | Project Cost, Financing & Status | Description |
| A. Energy sector | |||
| Tina River Hydropower Project (TRHPP) | ADB, WB, Bilateral (Australia, Korea) | - $233.37 mil. In PPP (Built-Operate-Transfer) - Loan: 66.8%, Grant: 21.2% - New ongoing (2019–2025) | Develop renewable energy source. Build 15 MW hydro power plant for electricity supply in Honiara; CO2 reduction (49.500 tons/year) and tariff reduction expected. |
| Solar Power Development Project | ADB | - $13 mil. - Grant: 56%, Budget: 44% - Almost completed (2016–2022) | Develop renewable energy source. Generate 2 MW grid-connected solar power in Kirakira, Lata, Malu’u, Munda and Tulagi. |
| B. Transport sector | |||
| Transport Sector Flood Recovery Project (TSFRP) | ADB | - $13.2 mil. - Loan: 50%, Grant: 50% - Completed (2014–2018) | Restore more resilient transport connectivity after the Cyclone Ita. Reconstruction of bridges and roads in Honiara/ Guadalcanal provinces |
| Sustainable Transport Infrastructure Improvement Program (STIIP) | ADB, Australia | - $25.5 mil. - Loan: 82%, Grant: 18%) - Almost comleted (2016–2021) | Improve nationwide (rural and urban) transport system through rehabilitation and maintenance, strengthen climate and disaster resilience of road |
| Land and Maritime Connectivity project | ADB | - $150 mil. - Loan: 50%, Grant: 50% - New ongoing (2021–2028) | Rehabilitating/upgrading of 35 km roads near Honiara and upgrading ports/wharfs in Honiara, Ahanga, and Kira Kira. Objectives are to boost transport (land and maritime) connectivity, efficiency, and disaster resilience of transport network. |
| Road and Aviation Project (SIRAP) | WB | - $51 mil. - Loan: 60%, Grant: 40% - New ongoing (2019–2024) | Improve air transport and strengthen the climate resilience of roads |
| Upgrading of Kukum Highway | JICA | - 3.2 bil. Yen (=$29 mil.) - Grant: 100% - New ongoing (2021–2023) | Improve logistics improvement, disaster prevention and traffic safety through upgrading of Kukum highway in Honiara |
| Costs of new ongoing projects | Total cost: $463.37 mil (=15.2 percent of 2030 GDP) Annual average project cost: $85.02 mil (=2.8 percent of 2030 GDP); of which external loans-financed cost is $42.82 mil (=1.4 percent of 2030 GDP)) | ||
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Prepared by Manabu Nose (FAD). The author appreciates active discussion and feedback from Solomon Islands authorities (including Ministry of Development Planning and Aid Coordination; Ministry of Environment, Climate Change, and Disaster Management; Ministry of Education and Human Resource Development; Ministry of Infrastructure Development; Ministry of Mining and Energy; and Solomon Islands Energy Authority) during the 2021 Article IV Consultation. Insightful discussion with sector experts from Asian Development Bank, UNDP, UNICEF, and World Bank; and inputs from Aleksandra Zdzienicka (OMD), Tewodaj Mogues (FAD) and Mercedes Garcia-Escribano (ICD) are greatly acknowledged.
A separate target for Honiara is set at 90 percent renewables by 2030.
Solomon Power has committed 19 renewable (Hydro and Solar Hybrid) projects that are co -financed by donors’ capital grants. With donor supports, 16 Solar Hybrid projects aim to expand customer base outside Honiara, which is also expected to contribute to the promotion of rural electrification.
The exercise involves several steps: (i) identify main cost drivers of each sector; (ii) set the reference values of each cost driver consistent with the best-performing peers (or national policy target); and (iii) calculate the necessary spending level in 2030. The peer group is selected from countries in the same income bracket and same level of SDG, human development, and climate vulnerability index, but final selection also reflects the views of sector experts from development agencies (Tiedemann et al, 2021).
The point estimate is subject to two key caveats: (i) the costing method does not cover other key sectors (e.g., agriculture, natural resources) and other types of infrastructure, such as maritime transportation and digital infrastructure, which are important for island economies such as Solomon Islands; and (ii) the methodology does not explicitly account for urban-rural disparities in service quality (except for water and sanitation). Sector experts from other agencies suggest that improving education, health, and water and sanitation services would cost much more in remote areas due to higher project costs. In this respect, the result could be interpreted as a relatively conservative estimate of total development spending needs.
In the dynamic financing model, annual SDG investment is endogenously determined by overall deficit, revenue, and non-SDG expenditure envelops that are exogenously set in line with the staff’s macroeconomic framework.
For example, the Ministry of Finance of Bangladesh publishes climate-related budget performance in the budget reports (“Climate Financing for Sustainable Development: Budget Report” and “Bangladesh Economic Review: Chapter 15: Environment, Climate Change and Development”).