Cariblanco Power Plant: Investors and Consumers Reassured in Costa Rica

This has been a year of electricity woes for Costa Rica, after a blown transformer at a substation shorted out the national system on April 19. The system was already running at near-capacity, and the April event triggered the first nationwide blackout in more than five years.

After more than a week of rolling blackouts, officials said they had everything under control. But on May 18, the 82-Megawatt Cariblanco hydroelectric station was shut down due to problems in its ventilation system. The project had just been inaugurated by President Oscar Arias some two weeks earlier; it had only been in operation for three months.

Now local authorities say the Cariblanco station could be back online in the coming weeks. This would give a much-needed boost to the electric grid, which is currently relying heavily on hydropower produced at the Arenal reservoir, as well as on expensive fossil-fuel power plants.

Pedro Pablo Quirós, executive president of the Costa Rican Electricity Institute, or ICE (the government institution with a monopoly on the electricity and telecommunication markets), says the first of two damaged turbines has been repaired and the second should be up and running by the end of August.

Costa Rica's Banco Nacional (National Bank), the fiduciary for the project, has assured investors with a stake in the $170-million plant that they will not be affected by the plant's problems. ICE must begin its $2.2-million monthly payments to Cariblanco in October, regardless of whether the plant is operating.

Local sources say more hydropower (via the Cariblanco plant) is good not only for the environment, but also for consumers. When the reservoirs that power the country's largely hydroelectric infrastructure run low (as was the case this year), Costa Rica's only short-term strategy is to rely on fossil-fuel thermal plants, and to buy power from external sources. This strategy translates to high costs, which are passed on to consumers.

It is expected that the government will have to rely on fossil fuel to meet energy deficits through next year…unfortunate news for anybody paying an electric bill in Costa Rica.

Your Latin America Insider,
Suzan Haskins
for International Living

P.S. That electricity bill can make a dent in your monthly budget-it pays to find ways to save. Here's a tip I got from a money-conscious friend.