Editor,

Initially the selling of the ideas of privatizing power generation and power distribution were acceptable and that was from a view that the government must streamline its functions and put more focus on ...“Quality Assurance...”. The Ministry of Lands, Survey and Natural Resources is having the mandate to develop appropriate policies frameworks and legislative in-place for managing power electricity and renewable energy. The Tonga Electric Power Board (TEPB) was mandated to oversee the technical part of the show and participate in assuring the quality assurance by inspecting to ensure the compliances of all buildings in Tonga with power safety to minimize the continuous accidents that were caused by electricity. TEPB was also vested the power to authorize and issue business certificate and license for all the electrical company in Tonga include Shorelines Ltd.

The deal between the Tonga Government and the Shoreline was to give in all the TEPB assets for the Shorelines Ltd. and I believe that there was a contract between the Shorelines and the Government of Tonga for the generation and distribution of power electricity in Tonga. Tariff for example, the TEPB must monitor and approve any proposed increase from the Shorelines Ltd. The benchmark for the tariff was based on the latest tariff ~ may be 28 seniti per KWH, the latest tariff after taken over from TEPB. I understand that the Shorelines Ltd. must pay monthly fees to the TEPB ~ estimates $50,000 to $100,000 per month, as part of the pay back and for the operation of TEPB (assumption).

Shorelines Ltd. remains as private entity with absolute right to the business law in Tonga. I understand that the Shorelines Ltd. had tremendous investment on power generation and eventually created vast differences in terms of generating power efficiency. Let me give an example, the old power generator generated 4 kwh per 1 liter of diesoline. The new investment of Shorelines managed to generate 8 to 10 kwh per 1 liter of diesoline. This indicates an increase on the power efficiency by 100 to 150% with direct proportion to the profit achievement. I believe this was the avenue where the company managed to save huge profit to finance any of their operational expenses including the high salaries that offered to their professional staffs, including the Board of Directors, while maintaining the tariff at the initial benchmark. There is no right in my opinion for the TEPB or the government to intrude and violate the business law by controlling the Shorelines cash flow and internal affairs.

Having indicated that the tariff benchmark was 28 seniti per unit, the fluctuation in the oil price remains the major factor to determine the tariff and I assume that the TEPB used and accepted any proposal from the Shorelines to increase tariff when the oil price increases. This is reasonable to me from increasing diesoline, $1.05 in 2003 to $2.54 in 2007, increased by 150% during the last 4 years ...– this is proportionate to the increase of tariff from, 28 seniti to 60 seniti in 2007 ~ 130% increase ...– primary school kids can work this out.

I certainly agree that since the Shoreline intervened, the electricity became more reliable and I cannot deny the miss-understanding amongst us commoners and the lip services of our fellow MPs have created chaos to the country. I do not know whether the MPs understand the above simple mathematics and I can imagine how confuse are the many people in Tonga on the whole issue.

The Shorelines is doing well in my opinion but if they move ahead and sell out the business to the NZ North Power, let them go ahead but the government must draw clear benchmark to control the tariff ...….. example, in Fiji, they lock the tariff at certain ranges say 30 seniti per unit to 40 seniti per unit for 5 years. The price range will give a choice to the company whether to take the deal or not. This is the kind of risk assessment that the bit company must decide whether to take the deal or not. This kind of special condition also catalyzes the investment of the company on power efficiency, leading to huge profit achievement and that was the same strategy I believe the Shorelines implemented. Imagine if the shoreline invested on renewable energy ...…...…. this can easily double or triple their profits and again the government can renegotiate to decrease the ranges of tariff to create better advantages for business and economic development in Tonga and all of us commoners ...– I sense that this was the ultimate goal and vision of His Majesty.

I certainly believe that the government made the right decision at the first place for the Shorelines. The government must streamline its functions and intervene to ensure the reliability of power generation and distribution in Tonga ...– the backbone of business and economic development. Unfortunately, the unnecessary political rival has politicized the whole matter, leading to brainwashing and miss-conceptualize the majority of the people ...…...… and that is what I call ...“angahala fai ...‘ilo...” the end results we all know ...…...…...….

'‘Ofa atu

David Tapiaka

dtapiaka [at] yahoo [dot] co [dot] nz