Electricity pacts will begin on Monday; they will invest US$3.6 billion
To apply a real rate they would have to increase rates by 14% and 150%
Diario Libre
SD. The executive vice-president of the Dominican Corporation of State-owned Electricity Enterprises (CDEEE), Ruben Bichara, announced that next Monday the government will begin to sign electricity pacts with each one of the private electricity generators, in which both parties commit themselves to make investments to change the basic fuels used in the generation of electricity.
He spelled out that the projects that they will push for include the conversion to natural gas and coal of the existing plants which function with petroleum products. In order achieve this will take a public and private investment of US$3.6 billion to install 1,500 new megawatts with coal and natural gas. Of this amount, the state will supply US$2.0 billion to construct two coal-fired plants of 300 megawatts each which with the combined cycle will reach 640 megawatts.
The official talked about these initiatives during the monthly luncheon of the American Chamber of Commerce in the Dominican Republic (AmCham), in which he took part as the invited guest speaker. His talk was titled: "The Electric Sector: towards an integrated plan. Together it is difficult, separate impossible."
With the motto, Bichara wished to stress that it is necessary to push for an integrated play with the support of all of the sectors in the country with the objective of finding a definitive solution, but long term, of the electricity problem in the Dominican Republic.
He insisted on several occasions that it is not sufficient to renegotiate the contracts with the electricity generating companies, make the system of collecting money more efficient, achieve a substantial reduction of losses, and adopt other initiatives but rather that all of the social segments propose solutions and commit themselves to contribute with the solution of the problem. As a result of this vision they will start with the first phase of the electricity pact which is the signing of the agreement with the generating companies.
During the luncheon meeting, the businessmen asked him if it was certain that the government by itself will implement the electricity pact with the energy generators and will not include the Economic and Social Council. To this he answered that a first stage of the pact is with the generators and that later on they will include all of the sectors.
Bichara announced that the government will start in the next few weeks the construction of the first combined cycle gas plant that will supply the system with 600 megawatts and will enter into operation in some three years.
He said that in order to speed up the negotiations of the financing of the plant with the multilateral credit agencies, he will travel to Washington together with the Minister of Hacienda, Simon Lizardo, within the next few days.
As the fundamental axis of the Integrated Strategy for the Electricity Sector he cited, besides the modification of the basic fuel used in generation, the reduction of losses and the efficient management and that the impact of these initiatives will begin to be felt in 2015 and 2016.
He believes the CES should participate in big pact of 2013
The president of the American Chamber of Commerce in the Dominican Republic, Julio Brache, said that it is necessary that the Economic and Social Council (CES) once again returns to push for a consensus so that they can firm up the three big pacts for 2013: Education, Taxes and Electricity.
He stressed that as one of the pending issues the implementation of the National Development Strategy. "We have the historic responsibility to achieve that the agreements and plans for these three areas of our national life at the short, medium and long term are so excellent that they generate benefits that citizens and economic and social sectors deserve for their development and welfare," he pointed out.
He believes that only with the participation of the CES in these pacts can they achieve legitimacy and the involvement of all of the sectors "when it comes time to defend then in case that someone dares to handle them in order to benefit interests that are not those of the nation or those of the Dominican people."
He cited among the contribution made during the two years of his term at the head of this entity his participation together with the authorities and other organizations in the modification of the General Customs Law which is waiting to be approved by the National Congress.
They were also involved in the Law for the Development of the Mortgage and Trust Market and the Law for Mercantile Restructuring and Judicial Liquidation, pending the debates needed for legislative approval.
In addition, he stressed the written alliance signed with Ecored to promote the protection of the environment from the business standpoint and the successes achieved with the Dominican Week in the United States and other places.
A rate increase of between 5% and 150%?
Bichara said that although there are social and sustainable reasons, the government will have to make a decision regarding the increase of the electricity rates since there is a very strong discrepancy between the tariff in use and the indexed tariff. "There is a decision that will have to be taken," and he said that if they apply the tariff that is indexed (the real tariff) according to the consumption there will have to be increases of between 14% and 150%.
In addition, he reported that they need an yearly investment of UD$145 million in order to achieve a reduction of the yearly losses of US$200 million.
He spelled out that the projects that they will push for include the conversion to natural gas and coal of the existing plants which function with petroleum products. In order achieve this will take a public and private investment of US$3.6 billion to install 1,500 new megawatts with coal and natural gas. Of this amount, the state will supply US$2.0 billion to construct two coal-fired plants of 300 megawatts each which with the combined cycle will reach 640 megawatts.
The official talked about these initiatives during the monthly luncheon of the American Chamber of Commerce in the Dominican Republic (AmCham), in which he took part as the invited guest speaker. His talk was titled: "The Electric Sector: towards an integrated plan. Together it is difficult, separate impossible."
With the motto, Bichara wished to stress that it is necessary to push for an integrated play with the support of all of the sectors in the country with the objective of finding a definitive solution, but long term, of the electricity problem in the Dominican Republic.
He insisted on several occasions that it is not sufficient to renegotiate the contracts with the electricity generating companies, make the system of collecting money more efficient, achieve a substantial reduction of losses, and adopt other initiatives but rather that all of the social segments propose solutions and commit themselves to contribute with the solution of the problem. As a result of this vision they will start with the first phase of the electricity pact which is the signing of the agreement with the generating companies.
During the luncheon meeting, the businessmen asked him if it was certain that the government by itself will implement the electricity pact with the energy generators and will not include the Economic and Social Council. To this he answered that a first stage of the pact is with the generators and that later on they will include all of the sectors.
Bichara announced that the government will start in the next few weeks the construction of the first combined cycle gas plant that will supply the system with 600 megawatts and will enter into operation in some three years.
He said that in order to speed up the negotiations of the financing of the plant with the multilateral credit agencies, he will travel to Washington together with the Minister of Hacienda, Simon Lizardo, within the next few days.
As the fundamental axis of the Integrated Strategy for the Electricity Sector he cited, besides the modification of the basic fuel used in generation, the reduction of losses and the efficient management and that the impact of these initiatives will begin to be felt in 2015 and 2016.
He believes the CES should participate in big pact of 2013
The president of the American Chamber of Commerce in the Dominican Republic, Julio Brache, said that it is necessary that the Economic and Social Council (CES) once again returns to push for a consensus so that they can firm up the three big pacts for 2013: Education, Taxes and Electricity.
He stressed that as one of the pending issues the implementation of the National Development Strategy. "We have the historic responsibility to achieve that the agreements and plans for these three areas of our national life at the short, medium and long term are so excellent that they generate benefits that citizens and economic and social sectors deserve for their development and welfare," he pointed out.
He believes that only with the participation of the CES in these pacts can they achieve legitimacy and the involvement of all of the sectors "when it comes time to defend then in case that someone dares to handle them in order to benefit interests that are not those of the nation or those of the Dominican people."
He cited among the contribution made during the two years of his term at the head of this entity his participation together with the authorities and other organizations in the modification of the General Customs Law which is waiting to be approved by the National Congress.
They were also involved in the Law for the Development of the Mortgage and Trust Market and the Law for Mercantile Restructuring and Judicial Liquidation, pending the debates needed for legislative approval.
In addition, he stressed the written alliance signed with Ecored to promote the protection of the environment from the business standpoint and the successes achieved with the Dominican Week in the United States and other places.
A rate increase of between 5% and 150%?
Bichara said that although there are social and sustainable reasons, the government will have to make a decision regarding the increase of the electricity rates since there is a very strong discrepancy between the tariff in use and the indexed tariff. "There is a decision that will have to be taken," and he said that if they apply the tariff that is indexed (the real tariff) according to the consumption there will have to be increases of between 14% and 150%.
In addition, he reported that they need an yearly investment of UD$145 million in order to achieve a reduction of the yearly losses of US$200 million.
Diario Libre
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