Out of 230 countries, a new research has found that Solomon Islands has the World’s most expensive power supply.
The research, which analysed 3,883 tariffs across 230 countries, found that Libya offers the cheapest electricity in the world at just USD0.007 per KWh while the most expensive electricity in the world can be found in the Solomon Islands, where one KWh is a staggering USD0.692.
That means Solomon Islanders are paying ninety-eight times more than what Libyans are paying for electricity.
Within the region New Caledonia is the cheapest (USD0.091), closely followed by Fiji (USD0.144), New Zealand (USD0.153) and Australia (USD0.172). The Solomon Islands (USD0.692) is the most expensive, both in Oceania and in the world.
On average, the cost of electricity in the Solomon Islands is seven times more than what others are paying in the region.
In a study that explored the relationship between electricity prices and economic growth the empirical findings reveal that high electricity prices do in fact stifle economic growth.
South African academic Dr Hlalefang Khobai, in an article published by the Journal of Energy Economics and Policy, say studies indicate that a 1% increase in electricity prices is associated with an approximately 0.05% decrease in economic growth.
He says this assumption was confirmed by a study on the impact of electricity price on economic growth in South Africa, which showed that a 1% increase in electricity prices caused the economic growth to drop by 0.036%.
The Solomon Islands Chamber of Commerce and Industry (SICCI) and the Economic Association of Solomon Islands (EASI) have been calling for a reduction in the price of electricity, saying current prices are disruptive to business operations and constrains resource allocation, resulting in an increase in the cost of production.
SOURCE: SOLOMON TIMES