Power Reliability Improvement and Storage Management Project (ADB-59109-001)

Regions
  • East Asia and Pacific
Geographic location where the impacts of the investment may be experienced.
Countries
  • Palau
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Asian Development Bank (ADB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Borrower
Government of Palau
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Energy
  • Infrastructure
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Grant, Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 10.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 10.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ ADB website

Updated in EWS Apr 1, 2026

Disclosed by Bank Feb 10, 2026

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Contact the EWS Team

Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

As stated by the ADB, the project will install an estimated 6 MWh of battery energy storage and associated infrastructure for stable operation.

Palau is a small island developing state with a population of about 18,200, highly dependent on tourism and external grants, and particularly vulnerable to climate change and disasters, with annual losses estimated at 1.6% of GDP; as part of its climate commitments, it aims to significantly cut greenhouse gas emissions and increase renewable energy use. The country's electricity system managed by the Palau Public Utility Corporation (PPUC) relies heavily on diesel generation, resulting in high and volatile electricity costs, with fuel accounting for over 80% of generation and tariffs reaching $0.506/kWh in 2024.

To support decarbonization and cost reduction, Palau commissioned a 15.2 MWp solar IPP with battery storage in 2024, but weak post-pandemic demand, take-or-pay obligations, and rapid growth in rooftop solar have led to significant curtailment and financial pressure on PPUC. These challenges are compounded by the absence of sufficient load-shifting battery capacity, an outdated and unreliable grid unable to smoothly integrate variable renewable energy, and the lack of advanced energy management and SCADA systems. Additionally, persistent capacity constraints within PPUC particularly in system planning, operations, and maintenanceunderscore the need for grid upgrades, storage solutions, and sustained workforce development to ensure reliable, affordable, and sustainable electricity supply.

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

The ADB categorized the project E&S risks as follows:

  • Environment - B
  • Involuntary Resettlement - C
  • Indigenous Peoples - C
Investment Description
Here you can find a list of individual development financial institutions that finance the project.

Information on the grant amount not provided at the time of disclosure.

Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

As stated on the company's website, the Palau Public Utilities Corporation (PPUC) is a public corporation established to manage and operate the electrical power and the water and wastewater systems of the Republic of Palau.

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - Palau Public Utilities Corporation (PPUC) Contractor Infrastructure

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

ADB Team Leader:

Len V. George
Email: lgeorge@adb.org 

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.adb.org/forms/request-information-form

ADB has a two-stage appeals process for requesters who believe that ADB has denied their request for information in violation of its Access to Information Policy. You can learn more about filing an appeal at: https://www.adb.org/site/disclosure/appeals

ACCOUNTABILITY MECHANISM OF ADB

The Accountability Mechanism is an independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an Asian Development Bank-financed project. If you submit a complaint to the Accountability Mechanism, they may investigate to assess whether the Asian Development Bank is following its own policies and procedures for preventing harm to people or the environment. You can learn more about the Accountability Mechanism and how to file a complaint at: http://www.adb.org/site/accountability-mechanism/main.

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How it works