La Republica
September 22, 2009

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Dry winter means increased oil fired power generation

Purchase of diesel by ICE rose 224% in August

• Greater oil consumption could push up electricity tariff prices next year
• Government proposes to open power sector to new companies to help expand supply

The decrease in river flows in much of the country is forced to burn more fuel to ensure supply of electricity during the winter.

Only last month reported a drop of 18% in hydroelectric power production, compared with a year ago, a product of less water.

To avoid missing blackouts as a result of hydroelectric production, the Instituto Costarricense de Electricidad (ICE) in August had to buy 224% more for diesel in the previous year and 1,200 barrels of bunker.

These figures were provided by the Costa Rican Petroleum Refinery (Recope) based on last month's sales.

The previous year's situation was very different, because in August the ICE required only 28 thousand barrels of diesel to meet peak electricity consumption and did not need to buy the bunker, because it had enough water to meet the demand.

The difficult scenario facing this year responding to the aftermath of El Niño, which is causing droughts at a time when traditionally recording high rainfall. Low rainfall affects more strongly to the Pacific and Midwest.

This is what has caused the rivers from which water is extracted to power the turbines of the hydroelectric plants have less flow.

One of the exits had to start the ICE is to open the floodgates of dams Cachi, Angostura and Peñas Blancas to remove sediment and thus ensure a higher power storage, Elbert said Duran, a spokesman for the institution.

The measure to remove the garbage that have accumulated in the bottom reservoir is taken as the current situations where you need to have the greatest ability to collect water as possible to meet next summer, said Duran.

So far the Laguna del Arenal is the project that has been least affected by drought is fed by rivers as from regions where it has been raining. However, Duran said the project is used to deal with situations of true emergency.

The disadvantage of producing energy from oil is that this technology produces more pollution and it is up to eight times more expensive in relation to the produced from water.

Proceeds from the increase in operating costs to meet electricity demand this winter was that ICE opposed the reduction of 7% in fees that went into effect this month, said Duran.

The argument of the adjustment in the electricity bill that ICE was consumed half of the approved budget for the production of thermal power during the summer, which would compensate users.

The proposed rates have remained as they were was the most practical, Duran said, he insisted that the institution studies projected that they would need greater consumption of fuels to meet electricity demand in the rainy season due to drought .

If ICE determines that the increase in the purchase of diesel and bunker to produce thermal energy threatens its financial stability, you can file an adjustment of rates, recognized in Regulating Authority of Public Services (Aresep).

To avoid situations like the current executive branch and both the ICE driving initiatives to increase the supply of electricity.

The Government, for example, presented to the Legislative Assembly a bill that expands private participation in electricity production. The current rule only allows the private sector to produce up to 15% of installed capacity in the country by the State.

The Institute, in turn, promotes the construction of large power plants in regions with high precipitation as Siquirres, Buenos Aires, Perez Zeledon and Turrialba. Among all these projects would double the national installed capacity.