New government will not refer to modernize refinery to assess energy matrix

April 21st, 2014.

Before turning to the possible modernization of the refinery in Limon, the next government will sit to review the country’s energy mix and will meet with the new authorities of the Costa Rican Oil Refinery (Recope) to assess the issue.

This is a priority issue for the incoming government and will be covered “very soon.” This was explained Edgar Gutiérrez- Espelette, who was appointed by President-elect Luis Guillermo Solís, as Environment Minister in his cabinet.

“The refinery beyond becoming an environmental issue is a country theme. Which will have to be defined in a broad and frank discussion with the new authorities in Recope and together with the president. This is a topic that is on the agenda and that is to cover ‘very soon’ and which will be released the country’s position “quoted Gutiérrez- Espelette.

Earlier this month reported that it maintained Recope plans to establish the new refinery project in China. Even in late February presented an alternative plan for the plant to continue operating and that they were viewed with suspicion by the current authorities of the Ministry of Environment and Energy (Minae). Asked about the issue, Gutiérrez- Espeleta asked to wait the official position that the government will respect Solis.

“There is discussion of the refinery itself, is a whole discussion of what the strategic vision of the energy matrix… We must devote ourselves to the initial discussion of the energy matrix, obviously already the president said: we are on energy renewable, that is indisputable but we have to land it on specific issues, “said the future minister.

The current dome Recope considered appropriate that the production of diesel continue to perform in the coming years. They base their explanation that the country would need six years to produce biofuels needed to meet demand, that would result in 160 thousand hectares of land.

In turn, the Comptroller General of the Republic (CGR) rejected twice, the project with the Chinese company HQCEC. Even Recope has spent more than $ 34.6 million in studies to make the project viable, but still has not succeeded.

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Electrical distributors have six months to start net-metering

April 22nd,2014.

Dear A.M. Costa Rica:

This is an update to an April 2 article entitled: Residents to get OK to produce and bank electricity

The landmark Autoridad Reguladora (ARESEP) regulation referred to in this article, which requires all electricity distribution companies to offer their residential and commercial customers grid-interconnection and net-metering privileges, was published in the government’s La Gaceta on April 8. This means that the clock is now ticking on the 6-month period that the distribution companies were granted by the Autoridad in order to prepare, submit and get approval on the technical requirements, application form, interconnection contract and commercial terms, all of which are required for consumers to apply for and receive net-metering services.

This six-month period for the electricity distributors to prepare their agreements is very, very generous, especially considering that all the distributors actually need to do is to adopt the exact same application, agreements and technical standards that the Instituto Costarricense de Electricidad has used very successfully for four years in their pioneering Pilot Program for Net-metering which began in 2010. This is essentially what the ESPH (Empresa de Servicios Publicos de Heredia) wisely did when it recently introduced its own net-metering program. (ICE and ESPH are the only two electricity distributors in the country with enlightened policies regarding small-scale, private power generation by their customers, i.e. the only two currently offering a net-metering service).

However, given that the Compania Nacional de Fuerza y Luz and some other distributors have consistently opposed the government’s policies promoting Costa Rican home and business owners being able to generate part or all of their own power, it will be a pleasant and welcome surprise if they don’t use every bit of this liberal time period, and especially welcome if they don’t use this process as an opportunity to introduce complexities that serve as barriers to customers taking advantage of their new right to access and use the national grid. In this respect the Autoridad Reguladora de Servicios Publicos was wise to require the distributors to submit their documents and get approval.

The silver lining here is that home and business owners who are interested in investing in their own renewable generation, likely solar generation, can use this time period to prepare themselves. For instance, they can gather their historical monthly consumption history and identify qualified service providers who can design, install and warranty a private generation connected to the grid.

There are many new companies advertising themselves as renewable energy service providers, some very good, and some with questionable levels of experience and equipment knowledge, and some with downright poor quality equipment and poor business practices. Maybe the worst example of these shoddy practices are companies selling obsolete equipment that has no manufacturer’s warranty protection, but concealing this fact from an unsuspecting client. So like any significant purchase or investment, consumers should do their homework, check references, read the small print, and maybe most importantly, visit completed projects by potential vendors to see the quality of their work.

Also consumers should be aware that once a distributor has Authoridad approval to actually launch the net-metering services, they will have to make an application with sufficient technical documentation to get the distributor’s approval. Due to its complexity and technical requirements, this application process will almost certainly require the professional help of a qualified renewable energy service provider. But once submitted, the distribution company will have a generous 120 days to process the application! And if the application is flawed, it may be that the process is even longer.

So, for someone considering an investment in private, renewable generation at a home or business, I suggest that he or she start now to investigate options for service providers and project financing, assuming the consumer wants to have solar panels generating power and reducing your electricity bill in the coming summer. If they use this time wisely, they can be generating clean, economical solar power later this year. Or, if they are located on the ICE or ESPH distribution networks, they are able to begin this process anytime, as both companies offer an excellent service to their customers wishing to generate their own electricity.

Jim Ryan

ASI Power & Telemetry, S.A.

Liberia

Source: A.M. Costa Rica

Carlos Obregón:'It is difficult to lower the electricity rates, but there's possibilities'

Interview

April 17th, 2014.

Engineer Carlos Obregon assume the reins of the Costa Rican Electricity Institute (ICE) on May 8. Yesterday I spoke with the Nation of its main challenges.

What will happen to the hydroelectric project Diquís?

My view is that the project requires Diquís system. Therefore, you should go ahead. For that we must seek a consensus. I believe this government will be characterized by transparency, dialogue, seeking support for the important work for the country, not just power.

What measures will, and that may give short-term results, to lower electricity rates?

We have already cited several elements to be analyzed in detail. One is the fuel tax. If this tax eliminated, the percentage reduction in rates is very low. Another is a possible reduction in the sales tax, but also has an impact on state revenues. The other is a financial engineering because there are projects already in operation, you are paying and financing conditions could be improved; understanding that no problem because each game has specific rules.

If the sales tax or the fuel touches generates a fiscal gap. Speaking sincerely. Is it possible to lower electricity rates in the short term?

At the moment we think so. Understanding that is something that the next government will inherit. And understanding, too, that as there is a lower interest rates has to do everything to it. I understand the concerns that you have. Personally, I think it is difficult to lower rates, but which, however, there are possibilities and we are analyzing.

Apart from fiscal options, I'm considering financial engineering and review of the variable cost of fuel. We must also consider the possibility of a fare medium voltage for the industrial sector.

Would it include assessing administrative costs as a return?

We must make a full assessment. What impact do lists, inventory costs, purchasing power, how it is giving buying power. If you need to see how the electric backup runs that ICE gives other companies and their absolute priority costos.Será take all these elements and analyze them in detail and in very short time.

What would be the short term?

The smallest possible. It would be this year.

You are pro ICE. Luis Guillermo Solis said that to lower rates if necessary open space for private generation is going to do. What is your position? Have you also softened its stance?

It is exactly the same of the president (elect). What happens is that all laws lawsuit has been here for more private sector participation in development projects. By what you have to orient the discussion is to determine all the factors that affect the rate and see if the increase in private generation produces a benefit in the cost of fees.

With the latest energy purchases showed that the private sector can provide cheaper energy than the Institute itself can produce.

I'd say that is not proven yet.

Course is shown. Private offered more casualties than the ICE or CNFL rates.

No, no. I still do not share that view.

The numbers say so.

No, I'm going to say. The ICE has built and paid plants that give the lowest energy costs.

But it also has plants like carisísimas Pirrís case.

You have other plants that play different roles in the system and have different sizes. What I want to say is that one can not start from the fact that, in my opinion, is not yet proven. One thing is the cost of purchase and other is the effect of the purchase of private power within the system, or the rate as a whole. So one of the things that we have established is that there should be full transparency.

No transparency is there today?

I mean in the sense that we have to generate instances of open discussion and explain to everyone how the system groups, what are the characteristics of different types of energy, why to use the thermal functions.

Source: 'La Nación'

Electric firms should anticipate rationing

April 03rd, 2014

From now on, should alert utilities, eight days in advance, when, where and for how long the rationing of energy apply. Otherwise, they will be punished.

Such rationing can only be scheduled from Monday to Saturday, between 5 am and 10 pm and never in hospitals, clinics or emergency radio stations.

They may not apply in systems pumping potable water or fuel in the industrial sector or economic concentration and road lighting.

So what defines the new rules of power quality approved yesterday Regulatory Authority of Public Services (Aresep).

This is a general framework that regulates the quality, plan the operational side and access to electricity. That the technical and commercial conditions to be met by operators and users entering the network down.

The regulation provides a new option for those who produce energy for their own consumption.

These may, just have a qualifying title (awarded by the Ministry of Environment and Energy), connect to the network of distributors and "save" there surpluses, which then will return. "Generators are also required to maximize the use of renewable resources and minimize heat generation. Defined criteria for measuring the quality of transmission and generation, "said Carolina Mora, spokesperson ARESEP.

Source: 'La Nación'