Japan will provide 5.9 million US dollars for the first-ever grid-connected solar system in the Marshall Islands capital of Majuro.
Agreements were exchanged on Friday in Majuro by Acting Foreign Minister, Amenta Matthew and Japan Embassy Charge d'Affaires Kazuyuki Ohdaira for the project that is expected to be developed in 2011.
Kazuyuki Ohdaira says the aim of the solar grant is to reduce Majuro's dependence on diesel-powered electricity.
The measure is part of Japan's climate change response program known as 'Cool Earth Partnership'.
A large array of solar panels will be placed on the roof of Majuro Hospital to feed electricity into the existing power generation system in the capital, which has a population of about 30,000.
The solar system is expected to generate about 200 kilowatts of power, about two percent of MajuroÂ¹s current peak electricity usage that is now supplied by diesel-powered generators.
Japan officials confirmed that the grant for the Marshall Islands is part of a four-nation, $20 million project in the Pacific that will provide similar solar power to the Federated States of Micronesia, Palau and Tonga.