Our Executive Director, Engineer Alfredo Mena was interviewed by an international agency of news “Business News Americas” in relation to the most excellent activities in the Corporation, like these are our GEOTHERMAL, EOLIC projects, .BIOMASA and HYDROELECTRIC. Next his declarations:

Alfredo Mena
Executive director
Energy research corporation (CIE)

Ecuador's power sector is undergoing major change as the government has established an electricity and renewables energy ministry and embarked on development of mega hydro projects.

The country also has set up a wind farm on the Galapagos islands and is mulling new legislation to further promote renewables.

To make sense of the changes, BNamericas interviewed Alfredo Mena, executive director of Ecuadorian non-profit energy research center Corporación para la Investigación Energética (CIE).

In this interview, Mena discusses the new ministry, high-profile projects and CIE efforts to help advance the country's power sector.

BNamericas: A little over a year ago, President Rafael Correa appointed Alecksey Mosquera Rodríguez to head the new electricity and renewables energy ministry. Has the move been positive? What has been achieved to date?

Mena: Before, the mines and oil ministry had a deputy electrification ministry that basically was responsible for power issues. Within the deputy ministry, there was a department for renewable energies and energy efficiency. So clearly the issues were very low on the administrative scale within the ministry. It was unlikely the ministry would make it a priority.

The renewable energies and energy efficiency department resulted from changes in national energy institute Inecel, which was an independent institution that managed energy planning, renewable energies and efficiency.

So the change that occurred last year to create the electricity and renewables ministry was very important because it increased the importance of not only power but also other areas that had been secondary in the energy and oil ministry.

I think from the point of view of improving the sector the decision was correct. Of course, organization takes time.

The electricity and renewable energy ministry has various departments including a deputy power ministry responsible for large projects and relations with [power regulator] Conelec. Another deputy ministry is tasked with renewable energies, small hydro projects and energy efficiency, all of which in the end will achieve better results.

BNamericas: It seems the government is placing a large emphasis on medium and large hydro but not much on small hydro.

Mena: I would say the power sector crisis is due to a lack of investment in generation and also to a lack of adequate price management so prices help cover costs and develop the sector.

At the moment, the government has is focusing on relatively large projects - Coca Codo Sinclair, Toachi-Pilaton, the Jubones project and a project near the Paute basin - which are relatively big projects and are a priority on the government agenda.

I would say that small projects of up to 10MW, 20MW and even less than 10MW and 1MW have not yet been given the necessary importance by this government.

BNamericas: So the majority of smaller projects are being carried out by the private sector?

Mena: There are some small projects the private sector is carrying out including our corporation. We are promoting projects of around 10MW, 8MW, where the idea is to include the participation of companies, industry chambers, local investors and eventually foreign investors.

I think a way to advance with this is with public-private partnerships. That could help avoid social conflicts that could come up over opposition to hydroelectric projects.

With regard to smaller projects, except one or two a state utility in the north is developing and a couple of others, the majority are private initiatives.

BNamericas: How would you rate the existing regulatory and legislative environment for promoting renewables?

Mena: I would say regulations have been a bit erratic and chaotic to date. There are within the power sector framework law some provisions that allow certain types of tax and customs incentives for projects and there also have been regulations from Conelec that even established special rates for renewable energy projects. But because they are so tangled up with other tax laws, practically they are not applied.

Right now in Ecuador, a very large legal transformation is underway with a project for a new constitution that will be put out to a vote. The issue is complex and right now I would say we don't have a very clear vision of what the future holds.

The constitutional project could support renewables but it is not very explicit. On the other hand, I would say the majority is oriented to be developed by the central government and very little by the private sector.

BNamericas: You mentioned lack of investment in generation, could you elaborate on this?

Mena: Why is there no investment in power generation? Because the Ecuadorian wholesale power market has not operated with adequate payment guarantees. That is to say, distribution companies that buy power from generators have not always paid for the true value of the power, with a few exceptions. That scares investors because it causes legal and economic insecurity.

Right now, some private generation companies are looking for industrial users with whom they can sign contracts.

It's possible the free and open power market in Ecuador could disappear. We will have a contracts market and possibly a single state buyer, although some type of contracting may remain between privates.

BNamericas: What is the current state of solar and wind power development in the country?

Mena: On the solar side, I would say the focus is to take power to totally isolated zones where transmission lines are too expensive such as the Amazon jungle. Our corporation prepared and submitted a solar atlas to Conelec, which is a first approximation based on satellite data.

As for wind, Galapagos is the first operating project because it was able to receive financing. On the continent, studies in which we also are participating have been carried out. But projects have not advanced as investors don't want to put money into a risky system.

In Ecuador, there isn't a lot of wind because we are in the equatorial zone. But there are zones that have microclimates where temperature differences produce wind currents such as Loja, Villonaco and Membrillo.

We are analyzing another project known as Huascacha in the Jubones river area in the south of Ecuador. Project studies have been completed in the Salinas zone in northern Ecuador's Imbabura province for around 15MW.

BNamericas: I'm surprised that for an active volcanic country, geothermal news and reports are almost non-existent.

Mena: One would suppose Ecuador is rich in geothermal power because we are surrounded by volcanoes that erupt every day. There are some fields that were identified years ago by Inecel, but the research was done on the surface. I understand the government is interested in developing geothermal, but we have yet to see direct action.

Our corporation began with an initiative and two years ago presented a project to the country's science and technology department Senacyt to carry out geophysical research in the Chachindio field, one of the fields that could possibly be the most important from the geothermal point of view.

BNamericas: What about biomass?

Mena: In terms of biomass, there only are two or three plants that are producing power for the system through a cogeneration model at sugar plantations. But our corporation has been working with other agricultural waste products to generate power and has researched other provinces in Ecuador to determine biomass potential and applicable technologies.

Right now, we are installing a research pilot plant that has two parts, one of which aims to produce coal from hard waste of African palm and the other a gasification plant, for which we are experimenting with rice husk, African palm waste and corn waste.

BNamericas: Energy efficiency also is taking a hold in the region. Any government action in this area?

Mena: The government is just beginning to tackle energy efficiency. There is an initiative by various ministries including environment, industry and electricity for a national energy efficiency program. We have presented a pilot project to work in three provinces in the center of the country.

BNamericas: Any other projects/initiatives the corporation will be working on through year-end?

Mena: We have a project in Ambato for small hydro that would use sewage water. And we are working on legislation to promote biofuels.

ABOUT THE COMPANY:
CIE is a private non-profit organization focused on promoting renewable energies and energy efficiency.

By David Casallas