The Minister of Works Transport and
Infrastructure (MWTI), Hon. Olo Afoa Fiti Vaai continues to question the involvement of
GridMarket in the process of acquiring Independent Power Producers (IPP) for Samoa.
Hon. Olo recognizes that whilst the Memorandum of understanding signed between the previous
Government and GridMarket states that the company receives no compensation from the State of
Samoa, he also believes that there is no such thing as a “free lunch” in arrangements like this.
Extracted from the MOU signed in 2019 by the Ambassador/Permanent Representative of the
United Nations in New York at the time: “In consideration for the GridMarket providing such
GridMarket Services without receiving compensation from the Independent State of Samoa. The
Independent State of Samoa acknowledges and agrees that it intends to pursue the Clean Energy
Initiative and that any Clean Energy Project(s) identified through or in connection therewith will
be pursued and sourced solely through the GridMarket platform and only with solution providers
agreed in good faith between the Independent State of Samoa and GridMarket.”
“This agreement signed by the previous Government with GridMarket looks very much like a
middleman situation to me,” said Hon. Olo.
“The previous Government brought them in to facilitate the processes between the Government of
Samoa through the Electric Power Corporation (EPC) and the IPPs, but when we already have the
capacity within EPC to do this.
“This MOU guarantees that they will be the sole middlemen for every single procurement process
the Government of Samoa will engage in for more IPPs in the future. Why? For what reason?”
Hon. Olo reiterated that while GridMarket is not directly getting compensation from EPC, he
understands that the company will receive a commission from IPPs that intend to engage with Samoa to pursue any Clean Energy Project. And currently, the GridMarket is pushing a project
with EDF-R, a French Solar Power Company.”
The Minister went on to clarify the questionable dealings between GridMarket, EDF and the
previous Cabinet.
“EDF-R is proposing to charge .73 sene per kW/h (.252 cents USD) excluding tax, meanwhile, the
EPC sells units to customers for .53 sene per kW/h, which is quite clearly a very bad deal,” said
Hon. Olo.
“At the beginning of the process, EDF’s proposed feed-in tariff stood at .14 cents USD tax
excluded (38 sene WST), however, due to a project implementation delay, the tariff was increased
to 21 cents USD (56 sene WST) without tax. EDF later highlighted that there is another 20 percent
increase in price due to the escalation of materials in the world, bringing the price to 25 cents USD
(70 sene WST) without tax.”
“We know, no one works for free. The EDF will pay GridMarket and how will they do that? By
charging more on their tariff, and who is paying for that? The EPC, and eventually the people of
Samoa.
“GridMarket assures to be transparent and open, but to this day, they have not disclosed how much
they will be getting out of this project from EDF.
“If they don’t agree with me, then tell me, how are they going to get paid? How much are they
going to get from EDF once this project pushes through?
“To really paint a picture of how crooked this dealing is; GridMarket is recruited by the Samoan
Government to supposedly support and advise during procurement processes for Green Energy
initiatives or projects, then the winning bidder – in this case, EDF – pays GridMarket, while the
Government of Samoa pays EDF.”
The Minister also questioned the legal processes undertaken by previous Government in efforts to
implement this project.
Hon. Olo said he received a report from the Office of the Regulator spelling out the illegality of
the ongoing project of establishing EDF in Samoa, which was enabled through Cabinet directives
despite the Regulator’s advice to go through the proper processes.
The issue with the EDF goes back to 2020 in which the former Cabinet approved FK (20) 44 based
on the Tender’s Board advice, from the EPC to go ahead with negotiating the EDF contract
working closely with the Ministry of Finance, Office of the Attorney General and the Office of the
Regulator. However, the negotiation was only between the EDF and EPC without regard to the provisions of the Electricity Act 2010 Part 7 Section 30 – “Regulator’s prior approval for
entering into power purchase agreements with independent power producers –
(1) an electricity network services licensee who intends to enter into a power purchase agreement
with an independent power producer must first apply in writing to the Regulator for approval.”
During the EDF contract negotiations, the Regulator was never consulted.
“I also want people to know that EDF was asking for a government guarantee of $100+ million,”
Hon. Olo said.
“Why was the previous Government considering such an absurd ask? I have heard more than 10
companies with Green Energy project proposals since entering this Office and none have asked
for a Government guarantee.”
The Minister of Works praised the former Ministry of Finance, Leasiosiofa’asisina Oscar
Malielegaoi, for declining EDF’s ask for a Government guarantee.
“If the former Finance Chief agreed with this guarantee as EDF goes ahead with the installation of
equipment, and a hurricane destroyed everything, who is going to pay?
“Our people will pay for it. The Samoan people will pay for that damage, affecting our national
debt or national reserve levels.”
The Minister of Works said he refuses to make the same mistake as the previous Government who
made the mistake of acquiring one of the current Solar companies in Samoa, selling a whopping
.99 sene per kW/h to the EPC.
“These are the sort of things we are trying to get rid of, to ensure our people are not burdened by
these stupid decisions made by previous Government,” he said.
“They accepted an IPP to sell units at such a high price of 99 sene WST while EPC sells it to
customers at a much lower cost of 53 sene WST, causing financial difficulties for the Corporation.
“And why is that? Because of the previous Government’s stupid mistake.”
The Minister of Works, Transport and Infrastructure also wishes to note that to this day, he has yet
to receive a formal letter from GridMarket regarding this matter.