Overview:
Palau is making waves in renewable energy. The Melekeok Ocean Thermal Energy Conversion (OTEC) project, set to launch in 2026, promises a stable 24-hour power supply while opening doors for local industries in aquaculture, agriculture, and cosmetics. Backed by Japan’s JICA, the project is more than energy—it’s a blueprint for economic growth and food security.
By: L.N. Reklai
KOROR, Palau — Palau is moving steadily toward launching its Ocean Thermal Energy Conversion (OTEC) project in Melekeok, with Japan International Cooperation Agency officials reporting progress during a meeting with President Surangel S. Whipps Jr. on Thursday at his One Stop Shop Office in Koror. The project is slated to begin initial operations in 2026.
The OTEC system harnesses the temperature difference between warm surface seawater and cold deep seawater to generate a continuous 24-hour supply of renewable electricity. Beyond energy production, it draws nutrient-rich deep seawater that can support commercial applications in aquaculture, agriculture, and cosmetic production. Officials said expanding these supporting industries will be key to maximizing the project’s economic impact for Palau’s residents.
“This project is a clear testament to our administration’s commitment to prioritizing Palau’s national development, food security, and economic diversification,” Whipps said.
JICA, working closely with Palau’s government, is helping to attract private sector investment in OTEC-related industries to ensure long-term sustainability. The collaboration draws on lessons from Japan’s OTEC demonstration plant in Kumejima, Okinawa, where the combination of renewable energy generation and industrial applications of deep seawater has been tested since 2013. Researchers and private partners, including Saga University and Mitsui O.S.K. Lines, are working to scale the technology to commercial viability.
Japan’s approach, often called the “Kumejima Model,” emphasizes multi-use applications for deep seawater, including aquaculture, agriculture, and cosmetics production, which Palau is now aiming to replicate. Expanding the OTEC project beyond electricity generation to include these industries could reduce the nation’s dependence on imported goods and create new business opportunities.
What Is OTEC?
Ocean Thermal Energy Conversion (OTEC) is a renewable energy system that uses the temperature difference between warm surface water and cold deep water to produce electricity. In a closed-cycle system, warm surface water heats a fluid with a low boiling point, such as ammonia, to generate vapor that drives turbines. Cold deep seawater then condenses the vapor back into liquid. Because OTEC relies on ocean temperature gradients rather than sunlight or wind, it can provide a continuous energy supply and simultaneously support industrial uses of deep seawater.
Japan’s Ongoing OTEC Efforts
Japan has long invested in OTEC research and demonstration. The 100-kW Kumejima plant has been operational since 2013, demonstrating both renewable energy generation and industrial applications using deep seawater. Plans are underway in Japan to scale OTEC to 1 MW, with public-private partnerships aiming to commercialize the technology while sharing expertise with Pacific island nations like Palau.
For Palau, the Melekeok OTEC project represents a chance to stabilize the power grid while creating complementary industries in aquaculture, agriculture, and cosmetics, aligning with national goals for economic diversification, energy independence, and food security.