Venezuelan Government Responds to High Electricity Demand with Measures

Mérida, June 14th 2011 (Venezuelanalysis.com) – Due to increased electricity use as well as the global need to save energy, the Venezuelan government is implementing a number of measures to encourage the private, public, and domestic sectors to reduce usage.

Measures to ensure decreased energy use

Yesterday the Venezuelan government, represented by vice-president Elias Jaua and  Electricity Minister Ali Rodriguez, announced five new resolutions to encourage energy saving and punish excessive use. The press conference was held in the headquarters of state-owned electricity company Corpoelec, in Caracas.

Resolution 77 refers specifically to public institutions which “should provide an example” for the rest of the population. They should form energy management groups responsible for carrying out actions in order to revise energy use. Article 4 of the resolution specifies measures in terms of air conditioning, lighting, refrigeration and use of billboards, elevators, water heaters, and office equipment.

Public institutions which have their own power generation systems must use them between 11am and 4pm, and between 6pm and 10pm. Also, those using more than 100KVA should install self-generation facilities before 31 December this year. Non compliance to this resolution could result in suspension of their electricity service.

Resolution 76 states that the private sector, such as shopping centres and large businesses that use over 1MVA, should reduce their monthly consumption by at least 10%. Non compliance will result in a 10% surcharge on that month’s bill and an additional 5% after that. Medical services, drinking water, the petroleum industry, security services, transport, communications, education, food, embassies, and waste services are exempt.

Domestic electricity use is referred to in resolution 74 and applies to those using between 500 kilowatts and 1,200 kilowatts, depending on the state and varying climate characteristics. Those clients who consume the stated amount or more, and do not reduce usage by 10% will pay 75% extra on their bill. Those who increase use will pay even more, while those who decrease use by more than 10% will receive discounts.

Measures due to increased electricity demand

The government says the measures are a result of increased demand, with electricity use increasing from 15,502 megawatts in January this year, to 17,060 megawatts this month.

Jaua said the increased demand for electricity was due to a “greater distribution of the wealth”, growth in the GDP, and wasting electricity.

“If we continue at this rate we’ll have to install 2,000 megawatts per year,” said Rodriguez, who added that not only were Venezuelans using more electricity, the population was increasing, and industrial and commercial activity had also increased.

Jaua explained that the price clients pay for electricity has “basically been frozen for the last ten years”, being “completely subsidised” by the state, “which has converted into a policy for the democratisation of access to electricity”. The government still has no plans to increase electricity prices.

The new measures aim to encourage “rational and efficient energy use… not to limit the right to electricity, but rather to avoid the inadequate and excessive use of energy, in order to guarantee a secure and stable supply of it”, Jaua said.

“Saving electricity is necessary today in the world, that’s why the United Nations has called for it, because electricity generation has limits, it’s not infinite,” he added.

Rodriguez added that the government will develop campaigns around efficient energy aimed at schools and at the adult population.

Possible sabotage

Jaua said the government wasn’t rejecting the possibility of sabotage as the cause of blackouts in the western part of the country on Saturday. “These practices of destabilization exist…we’ve proving it through photographs, and there are active criminal investigations underway related to electrical installations in the country,” he said.

Last Friday and Saturday problems in a power station in Zulia affected the electricity supply there as well as in Merida, Tachira, Trujillo, and parts of Barinas. On Friday night one transformer failed, then on Saturday morning there was an explosion in another one. Two more failures followed those. The government is investigating the causes of the failures.

Rodriguez accused some right wing sectors of encouraging the wasting of electricity through social networks and the media. However, he added, “we’re not blaming the people for the waste; rather it’s the wealthier people who use more energy.”

“In Venezuela we’re burning more than 600,000 barrels of petrol per day, and the way we’re going our refining capacity [of oil] will have to be assigned exclusively to this excessive consumption of petrol,” Rodriguez added.

The 2009-2010 electricity crisis and government’s strategy to increase supply

While mainstream media have likened the current situation to last year’s electricity crisis, in Merida state for example, one of the worst affected last year with daily blackouts for several months, has experienced perhaps 4 or 5 so far this year.

Last year’s electricity crisis, starting in around November 2009 and ending in April 2010 was the result of an intense and prolonged drought which diminished the water supply to the Guri dam – Venezuela’s main electricity source. Other factors such as increased demand and corruption and bureaucracy within Corpoelec also contributed.

In February 2010 President Hugo Chavez declared a state of emergency in the electricity sector. The emergency decree allowed the electricity minister to take extraordinary measures including investments in thermal power, education campaigns, and measures similar to those announced yesterday. Those measures also rewarded reduced use and charged more to those who increased it, though with stricter consequences for repeated violations by the commercial sector, such as suspension of supply.

Rodriguez said the government is planning to incorporate a further 2,173 megawatts this year to the national grid, by buying new generators and repairing other units.

So far, under the current government 7,582 megawatts have been added to the national grid – 2,190 megawatts in hydraulic generation and 5,392 in thermal power. Between 1989 and 1999, previous governments installed 2,945 megawatts, 2,572 in hydraulic generation and 373 in thermal generation.