Marshall Islands - Sustainable Energy Development Project

Overview & Synopsis

Ratings of the Sustainable Energy Development Project for Republic of the Marshall Islands were as follows: outcome was moderately satisfactory, Bank performance was moderately satisfactory, and M&E quality was modest. Lessons learned and recommendations are as follows. Expanding renewable energy on small island grids requires disciplined sequencing with firm generation and grid stabilization; future operations should model integration steps, align targets and commissioning timelines, and ensure protection settings, feeder connectivity, and generator synchronization are ready before transition, while documenting lessons from first deployments such as floating solar and storage integration. Flexible project management is critical under disruption; teams should institutionalize remote supervision protocols, risk tiered scheduling with buffers for high risk activities, digital progress tracking, and contingency resourcing to sustain delivery when mobility or supply chains are constrained. Building durable institutional capacity is essential; the Project Implementation Unit should be fully staffed with clearly defined roles and accountability, an Owners Engineer engaged from the outset, and project management outsourced if local hiring proves difficult, with plans to embed PIU functions into utility operations, appoint deputies from local staff, and implement clear succession and handover procedures. Indicators must be realistic and measurable; define formulas, scope, data sources, and responsibilities at appraisal for reliability, distribution losses, and renewable share, cover the full service areas of MEC and KAJUR, invest early in measurement systems, and establish transitional baselines to improve credibility and learning. Early land acquisition and site readiness are vital; address complex customary tenure through transparent criteria and participatory consultations, secure storage and logistics early to prevent losses, and implement robust occupational health and safety planning, continuous oversight, and corrective action tracking for site reinstatement. Procurement capacity needs strengthening; tailor packaging and sequencing to limited market competition, engage the market early, balance risk allocation for remote works, include appropriate price adjustment and currency provisions, standardize evaluation criteria, and reinforce contract administration and proactive oversight to avoid failed tenders, incomplete works, and cancellations. Long term sustainability depends on an operational and transparent operations and maintenance fund from the outset; define governance and eligible expenditures, establish reliable replenishment mechanisms such as tariff revenues or government transfers, link the fund to medium term financial plans, and publish regular reports to protect asset condition amid high costs and capacity constraints.