By Scott Morris
Vice-President of the Asian Development Bank and Eric J. Lam
Small island developing states are among the most vulnerable to climate impacts, including sea level rise, flooding, and extreme weather, despite contributing low global greenhouse gas emissions. These island nations are also heavily reliant on costly imported fossil fuels to meet their energy needs.
So when we talk about energy transition in a Pacific context, it’s important to be clear about why this matters.
The ideal energy future for Pacific nations is one that sees growth in energy access to meet growing development needs. This means energy that is affordable as well as reliable. These goals can only be met through greater reliance on clean energy and less reliance on expensive fuel imports.
As remote island nations, these states face challenges in securing reliable and affordable energy as they remain highly dependent on importing fossil fuels, according to the 2025 Energy Transition Readiness Assessment.
Excluding Papua New Guinea, small island developing states spend more than $1 billion annually on fossil fuels, representing nearly 80% of their total energy costs, the report states. Their economies are especially vulnerable to price and exchange rate volatility, with net fuel imports reaching an average of 6.8% of GDP in 2020. As a result, these vulnerable states face increased costs of living for electricity, water, and other essential services.
Energy access also varies widely: although electricity access averages 90%, clean cooking solutions lag at 50%.
Despite ambitious plans to reduce their reliance on fossil fuels, many small island developing states face regulatory and institutional capacity constraints, hindering their ability to collect, analyze and use data to advance their targets. This reduces their ability to create an enabling environment needed to attract and manage clean energy investments.
The deployment of renewables also comes with the challenges of e-waste. As remote island nations, the disposal of used solar panels and wind turbines can create a waste problem given limited land area and recycling capabilities.
To keep up and ensure affordable energy supplies, small island developing states require substantial investments in their energy systems, including aging energy infrastructure which is typically underdeveloped and exposed to extreme weather events, sea-level rise, and flooding.
There are acute challenges for grid stability. The lack of grid reliability, and distribution losses averaging 18% across the region, is a challenge in many areas due to inadequate maintenance and underinvestment, these factors ultimately worsen energy affordability and reliability.
However, a lack of financial resources to invest in sustainable and resilient energy infrastructure complicates the region’s energy transition. Moreover, small states are expected to face increasing loss and damage from severe and frequent weather events associated with rising global temperatures. Pacific countries, including Nauru, Federated States of Micronesia, Marshall Islands, Solomon Islands, and Tonga, are the most vulnerable in the world when it comes to infrastructure vulnerability to climate impacts.
While the rapid adoption of renewable energy offers a promising path for small island developing states to secure their energy futures, a multifaceted approach is essential to scale up deployment effectively. This approach must ensure energy security and maintain an affordable, reliable energy supply.
Key strategies should include:
Strengthening Local Capacity and Institutional Support. Policymakers should prioritize investments in capacity-building initiatives that equip local stakeholders—including government agencies, utilities, and community organizations—with the skills and knowledge to manage renewable energy systems. This includes targeted training programs and structured knowledge-sharing platforms that foster collaboration across sectors. Enhancing institutional capacity also improves access to finance and supports the development of bankable renewable energy project pipelines.
Strengthening Regulatory Frameworks. Policymakers should strengthen institutional frameworks by enacting supportive policies and robust regulatory mechanisms that attract sustainable investment in the energy sector. These frameworks must uphold high environmental, social, and governance standards to ensure that renewable energy development aligns with long-term sustainability goals and community well-being. Prioritizing greater transparency in the energy sector will help to deepen markets for renewable energy by generating the data and knowledge that can better attract private capital and help governments better manage energy costs.
Building Energy Resilience in the Face of Extreme Weather. Prioritizing investments in resilient energy infrastructure designed to withstand extreme weather events and flooding is essential to reducing vulnerability and mitigating long-term risks. This includes supporting the development of decentralized energy systems to overcome issues surrounding integration of renewable energy sources at scale, land-use rights and availability of land, as well as end-of-life cycle for solar PV and wind turbines, including recycling capabilities and processes.
Leveraging Indigenous Knowledge for Resilient Solutions. Effective engagement and collaboration with indigenous communities can help identify sustainable solutions to meet energy and resilience needs. For instance, the Ngawha Geothermal Power Station in New Zealand was developed in close partnership with the Mātauranga Māori people, who brought deep-rooted cultural knowledge and environmental stewardship to the project. Their involvement went far beyond consultation. Māori leaders helped guide key decisions on site selection, water resource use, and environmental protection based on traditional values and land custodianship practices.
Small island developing states face a difficult path in pursuing their energy goals. Success will depend on more renewable energy, lower costly fossil fuel imports, and energy planning and systems that are resilient to extreme weather events. These activities are core not only to achieving climate goals, but also to the region’s continued development progress.
Scott Morris is Vice-President for East and Southeast Asia, and the Pacific at the Asian Development Bank. Eric J. Lam is and Energy Specialist at ADB’s Energy Sector Office.
The views expressed are those of the author and do not necessarily reflect the views of the Asian Development Bank, its management, its Board of Directors, or its members.
