Negotiations have started to evaluate alternatives for integrating the Mexican electricity market into Siepac.
Salvador Lopez, temporary president of the Electric Interconnection System for Central American Countries (SIEPAC) told Prensalibre.com that in the meeting they will start to assess the legal mechanisms that could be used to realize the integration.
The State of the Region indicates that the asymmetries between the most regulated markets such as Costa Rica and others that are freer such as Guatemala and El Salvador constitute an obstacle to progress of the regional market.
Regional Integration section, the V Report on the State of the Region:
The regional electricity market in the agenda of the integration process
Solutions have been found to the problems of easement and complaints from environmentalists, and the Electrical Interconnection System for Central America will be complete in its entirety in July.
The works on the last stretch of 32 km of the Electric Interconnection System for Central America (SIEPAC) in Costa Rica are 80% finished, after having suffered delays due to complaints about environmental damage and legal claims.
Guatemala is the most interested country in speeding up regulation establishing the model of firm contracts within the regional electricity market.
This was explained by Guatemalan Vice Minister of energy, Edwin Rodas.
The idea of this is to harness the Electrical Interconnection System for Central America (Siepac) not only for the sale of energy to other countries, but also to provide telecommunications services over optical fibers which these lines have.
The Electrical Interconnection System for Central American countries will be a decisive factor in reducing the cost of electricity at the regional level.
According to Ibrán Bueso, a legal advisor for the National Electricity Company (ENEE) in energy, one of the objectives of consolidation of the Electric Interconnection System for Central American Countries (Siepac) is to strengthen the competitiveness of the region by reducing its energy costs.
Mexico and Colombia could be the next countries to be incorporated into the Electrical Interconnection System for Central American Countries.
The issue will be discussed during a three-day meeting which Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and Panama, countries associated with the Electric Interconnection System for Central American Countries, (Siepac), will have this week.
Works on the Central American Electricity Interconnection System (SIEPAC in Spanish) are reported to be 95% complete, and are expected to be operational in March 2012.
At a cost of $490 million, the interconnection line extends from Guatemala to Panamá, with capacity to transport between 200 and 300 megawatts of electricity.
Teófilo De La Torre, president of the company that owns the network (EPR), stated that "the project will reduce the cost of electricity in the region due to the ability to make sales to other countries, including outside of the region, because Central America became connected with Mexico last year”, reported Notimex.
Interconnecting Mexico, Central America and Colombia is no easy task, and the Darien obstacle is one of the largest.
More than 40 indigenous groups are connected to the Panamanian territory, and discussions and consultations are being conducted with them seeking authorization for the project feasibility studies. The power line between Panama and Colombia could pass through the territories of the Kuna, or if not, alongside of the Embera and Wounaan groups, on land or in the Darien.
New investment opportunities open up with the coming into force in November of the regional regulations for the sale and purchase of electrical power.
EOR's executive director, René González, indicated during the third Regional Electricity Market Convention in San Salvador that, "we are now moving from the transitional phase into the main stage in the project, from a regulatory point of view, which will enable greater integration," according to an article published on 7dias.com.do.
This is the date by when Central American countries propose to have completed the regional power grid.
By the end of next August the link-up of Costa Rica and Panama is expected to be finished and by October that of Guatemala with El Salvador, says Enrique Martínez, general manager of the Central American proprietary power grid company (EPR in Spanish).
The region aims to standardize its energy laws and regulations, to make it easier to develop renewable energies.
Edgar Chamorro, executive director of SICA (Central American Integration Secretary), explained the initiative at the “XV Regional Forum of Central America’s Energy and Environment Alliance”.
He explained “that a Standardization Commission at Sica is working to harmonize regulations related to importing air conditioning devices, refrigerators, washing machines, televisions, home appliances and low energy transportation units”.
The infrastructure required for a regional electric interconnection system would be ready in 2010, reported CABEI.
Called SIEPAC, this project comprises building a 230 kW electric line spanning 1.790 kilometers. So far, $451 million have been invested in it.
“It is being funded by the Central American Bank for Economic Integration, the Inter American Development bank and other entities”, reported Informador.com.mx.
Costa Rica’s difficulties in expropriating terrains will delay the construction of 70km of electric lines.
The countries members of Siepac, the Central American Electric Interconnection System, expect to conclude their respective stretches of the line in September 2010, while Costa Rica would deliver it on October 2011.
Nacion.com reports that the rest of the countries are unhappy with this, and want the network to be operating as soon as possible, to improve energy supply and commercialization.
Siepac, Central America’s Electric Interconnection system, is 85% ready.
This project should go live in June 2011, with 1.800 kilometers of 230 kV transmission lines.
“When ready, electricity distribution companies will be able to buy energy at a regional level, and generation companies will be able to sell to any country requiring it”, reported Prensa.com.
The last component of the electrical interconnection project between both countries would be ready for July 2010.
Panama has already completed its share of the project, which is located in an area called "Friendship Ring" ("Anillo de la Amistad"). Costa Rica must still complete two power lines.
Elfinancierocr.com reports: "The agreement between both countries also created a permanent bi-national commission, that will develop other collaboration topics in addition to electrical interconnection, such as risks to natural resources, tourism, infrastructure, agriculture, health, education, social development, customs and migration".