Power consumption drives grid renewal
HIGHER STANDARDS OF LIVING MEAN ELECTRICITY GENERATORS MUST SEEK ALTERNATIVE SOURCES TO MEET RISING DEMAND

Venezuela has one of the highest levels of electrification in Latin America, at over 90 percent, and its per capita consumption of electricity leads the region. Usage is uneven, however, with the western state of Zulia consuming twice the national average.
The reasons for Zulia’s high consumption are self-explanatory as this is the center of the country’s oil production, and associated industries, which has had an interesting knock-on effect on domestic demand.

JESÚS M. RANGEL NAVA Nava President of ENELVEN

“Foreign personnel who came to work in the oil industry brought new standards of living with them,” explains Jesús Rangel Nava, President of ENELVEN, which is responsible for the electricity supply in Zulia. “Given the money in circulation, thanks to oil, the local population emulated the immigrants, in order to get a more comfortable life through the purchase of electrical goods, especially air-conditioning, because of the extreme heat in the region.”

This means that Zulia’s consumption levels are roughly on a par with Miami’s. But income levels are well below Florida’s, which has led to some people resorting to tapping illegally into the electricity supply. “Similarly, the economic situation means that people are unable to renew their air conditioners, which are 20 or 25 years old, and consume twice as much electricity as high-efficiency models,” says Mr. Rangel.

It’s not just domestic appliances that require renewing. The whole system of electricity supply and distribution is in need of modernization and reform, partly as a result of climate. Unusually for a major hydrocarbons
producer, Venezuela currently relies heavily on hydroelectric power, particularly since the development of facilities at El Guri on the Caroni river. But rains have been unpredictable recently, affecting generating capacity.

THE ELECTRICITY supply system needs modernization

Hence the program now under way to renovate the country’s thermal power capability. “We need to strike a balance between the hydroelectric system and thermal power, in order to meet demand reliably,” says Mr. Rangel.

He believes that gas-fired stations are the answer. “At the moment, hydroelectric power is the cheapest way of generating electricity, but the next in order of cost and cleanliness is gas-fired production,” he says. “This country is sitting on a giant reserve of natural gas which has not really been exploited, though that is on the way.”

PLANS are underway to create a National Energy Commission and a National Management Center to plan and operate the sector

ENELVEN is a subsidiary of one of the state-owned electricity generating companies, CADAFE, and had been slated for privatization. The idea was that this would make the sector attractive to future investors – providing more resources for modernization, as well as encouraging efficiency. But the government that came into power in 1999 has sometimes given the impression of being reluctant to press on with the privatization process.
Nonetheless, Energy and Mining Minister Rafael Ramírez insists it will happen. “We are going to break up all our national industries in the electricity sector,” he says. “We are going to look for strategic partners for electricity generation, and to work with us on the thermal power stations we have that are obsolete.”

Mr. Rangel believes that the sector should be attractive to investors, both at home and overseas. “I believe that investors enjoy security in our country, despite the image that is sometimes projected abroad,” he says.
“Quite a few successful investors have been operating here for many years – one example is Electricidad de Caracas, which is a private company that has transcended all the different economic and political scenarios here.”
Legislation is scheduled to create a National Energy Commission and a National Management Center, both of which will be designed to guide Venezuela’s overall electricity policy, as well as plan and operate the sector in the most efficient fashion to benefit both the customer and the country.

“These bodies have not yet been created,” Mr. Rangel says, “and this has had a strong influence on delaying critical action that needs to be started, to achieve stability within the electricity system in the medium to long term.”