Transcript Regulation of the Electric Sector

Comisión Nacional de Energía Atómica
A Review of The Liberalization of the
Argentinean Electricity Sector
Darío R. Gómez (CNEA)
Eduardo Lerner (ENRE)
Osvaldo Postiglioni (ENRE)
Carlos F. Rey (CNEA)
Introduction
At the beginning of the 90´s a deep reform was introduced in
the electric power sector of Argentina.
• To secure a reliable supply of electricity with
appropriate quality conditions
• To achieve efficiency in the usage of productive factors
• To order an put on a sound financial basis the fiscal
relationship between the electricity sector and the state
• To establish a regulatory framework appropriate to
encourage risk investment from the private sector
Electricity Sector Organization
NATIONAL
STATE
SECRETARIAT
OF ENERGY
Generators
Regulatory
Commission
MARKET
Large Scale
Users
Transporters
Distributors
Wholesale Electricity Market
Supply
TRANSMISSION
Private
Generators
Binational
Generators
International
Interconnections
(imports)
Distribution
Companies
1
State-owned
Generators
Large Scale
Consumers
WEM
2
Demand
3
1. Long Term Agreements
2. Seasonal Market
3. Spot Market
International
Interconnections
(exports)
Stakeholders in the Electricity Sector
GENERATION
TRANSPORT AND DISTRIBUTION
LARGE USERS
CAMMESA
Competition. Free Entry. Prices are not regulated.
Declared as General Interest
Natural Monopolies. Concessions. Regulated
Prices. Third Party Access. No discrimination.
Declared as Public Service
Freedom to Contract. Members of the
Wholesale Market. Their supply is competitive.
Non Profit Organization. In charge of the
administration of the Wholesale Market.
Economic Dispatch. Hourly prices. Members:




Generating Companies
Distribution Companies
Transport Companies
Large Users
Electric Regulatory Framework
Act 24.065 - 1992
SECRETARY
OF ENERGY
ENRE
ISSUANCE OF RULES
FOR THE ECONOMIC
DISPATCH
FEDERAL ENERGY
COUNCIL
GIVES ADVISE TO E.P
AND CONGRESS
CAMMESA
ECONOMIC DISPATCH
OPERATION
REGULATION
ACTS AS AN INSTANCE
CONTROL
OF APPEAL IN CASE
FEDERAL
JURISDICTIONAL
RESOLUTIONS GIVEN
BY ENRE ARE
REJECTED
ADMINISTER
NATIONAL FUND
OF ELECTRICITY
COMMERCIAL
TRANSACTIONS
Regulation
PRICE CONTROLS Prices, like under perfect competition, are determined
outside the firm. Therefore, profit maximization must be
achieved through managerial efficiency (cost reduction,
optimization of investment decisions etc).
QUALITY CONTROLS
The existence of captive demand (there are no alternative
suppliers) creates the need for product and service quality
controls
OBLIGATION TO SUPPLY Distribution companies have the obligation to meet all
demand. They can not discharge this obligation on the
basis of lack of generation or transport facilities.
THIRD PARTY ACCESS Transport and Distribution companies must allow third
party access to lines if there is spare capacity.
Privatization
1 transmitter
SEGBA
5 thermal
power plants
3 distributors
HIDRONOR
5 hydropower
plants
Agua y Energía Eléctrica
4 transmitters
1 distributor
9 thermal power
plants
8 hydropower
plants
Assets that belonged to several provinces were also privatized and
incorporated to the WEM
A
T9
2
Y9
3JU
L9
NO
3
V
93
-E
NE
94
M
A
Y9
4JU
L9
NO
4
V
94
-E
NE
95
M
A
Y9
5JU
L9
NO
5
V
95
-E
NE
96
M
A
Y9
6JU
L9
NO
6
V
96
-E
NE
97
M
A
Y9
7JU
L9
NO
7
V
97
-E
NE
98
M
A
Y9
8JU
L9
NO
8
V
98
-E
NE
99
M
A
Y9
9JU
L9
NO
9
V
99
-E
NE
00
M
A
Y0
0DI
C
00
M
O
C
92
-E
NE
93
G
O
92
-
NO
V
A
of the WEM
Number of Members
Cantidad
Performance of the Electricity
Sector under the Liberalization
2000
1900
1800
1700
1600
1500
1400
1300
1200
1100
1000
900
800
700
600
500
400
300
200
100
0
Autogenerators
Major Large Users
Minor Large Users
Transporters
Distributors
Generators
Generation
Installed Capacity (MW)
October 2000
Energy Generated (GWh)
January -October 2000
Nuclear
1.005
Nuclear
5.167
Termoeléctrica
11.106
Hidroeléctrica
10.834
Termoeléctrica
35.582
Hidroeléctrica
24.728
TOTAL 22.945
TOTAL 65.476 GWh
WEM + WEMPS
WEM
Maximum capacity declared according to demand
satisfied at WEM = 12.415
Self-generation and cogeneration. Imports not
included.
Generation - Installed Capacity
24.000
22.000
NUCLEAR
20.000
18.000
HYDRO
16.000
CC
MW
14.000
12.000
DI
10.000
8.000
TG
6.000
4.000
TV
2.000
0
1992
1993
1994
1995
1996
1997
1998
1999
2000
Generation by company - 2000
YACYRETA
15%
RESTO
24%
COSTANERA
8%
GUEMES
2%
ATUCHAI
2%
PUERTO
8%
S.NICOLAS
2%
CHOCON
2%
AGUADELCAJON
6%
P.DELAGUILA
6%
ALICURA
3%
LUJANDECUYO
3%
EMBALSE
5%
C.T.TUCUMAN
3%
GEBA
5%
SALTOGRANDE
5%
Generation - Prices
Energy Prices Sharply decreased from 1992 as result of a new
Electric Market Design
ENERGY AND SPOT MEDIUM PRICES
50
ENERGY
MONOMIC
40
30
20
10
0
1992
1993
1994
1995
1996
1997
1998
1999
2000
ENERGY
45.42
32.73
25.62
22.56
21.17
17.01
16.66
18.65
19.59
MONOMIC
48.76
35.88
31.92
29.73
28.56
25.25
24.38
26.08
27.38
NOA
NEA
CUYO
CENTRO
Installed and Demand Capacity by Area 2000
Capacity
Demand
BA-GBA
Litoral
NOA
1225 MW
952 MW
NEA
3248 MW
522 MW
CUYO
1276 MW
722 MW
CENTRO
2150 MW
1228 MW
BA-GBA Litoral
8440 MW
9635 MW
COMAHUE
5771 MW
476 MW
836 MW
519 MW
COMAHUE
MEMSP
MEMSP
Source: ENRE
Transmission Grid
Transmission
Length
in km
Lines 500 kV
9.292
Lines 330 kV
1.100
Lines 220 kV
500
Lines 132 kV
6.000
Source: Enre
Transmission
 95
years concession & 15 year management
periods.
 Free access to purchasers & sellers.
 Remove obstacles to purchase or sell energy.
 Remuneration for the operation & maintenance.
 Quality conditions compliance.
 Different grid expansion mechanisms.
Distribution
CHARACTERISTICS






Natural monopoly with regulated tariffs
Submitted to a regulatory framework
Obligation to meet demand and ensure adequate service.
Open access to third parties
Tariffs must be fair and reasonable covering operating
costs, taxes, amortization and a rate of return
Quality standards established by concession contract.
Main aspects related to the environmental
performance of the electricity sector

Incorporation of a new generating units to the WEM
and phase out of old ones

Improvement of the efficiencies of dispatched
thermal machines

Environmental attitude of new business units

Replacement of other types of energy by electricity
Main aspects related to the environmental
performance of the electricity sector

Decreasing technical and non-technical losses

Role of the community

Unrestricted fuel choice

No interest for hydropower projects by part of the
private sector
Environmental Policy applied to the
Electricity Sector - Until 1992
3 Environmental Management Manuals for
- hydropower plants
- thermal power plants
- ultra high voltage transmission lines
The Advisory Council on Licensing of Nuclear Facilities
of CNEA was in charge of the regulatory role for all
nuclear activities
Environmental Controls since 1992
Transmission & Distribution:
- Public security risks
- Waste treatment
Generation:
- Gas effluents control
- Liquid effluents control
- Noise levels
- Environmental monitoring of radioisotopes
Environmental Impact Assessment
-
Mandatory for new facilities
-
Mandatory to authorize modifications of power
plants or extensions of the systems of
transmission or distribution
-
Requires a public hearing where third party
comments, objections and petitions are
received
Environmental Legislation in Argentina
-
Amendment of National Constitution defines the
division of roles on environmental protection of
national and provincial authorities
-
Minimum standards must be established at
National level
-
Neither roles or minimum standards are defined
-
Competence overlapping and impairment of the
coordination of administrative environmental
activities
Economic Incentives
-
No economic incentive apart from dispatch priority
was included in the privatization scheme
-
Secretary of Energy maintained programs on
rational use of energy and non-conventional
energy sources
-
Act 25019 of 1998 assigns a special regime for
wind and solar energy through tax benefits
-
ENRE has started a discussion process on the
tariff for the distribution concessionaires
Trends in the Environmental Impact of
the Liberalized Electricity Sector
-
An exercise on the prospective development
of the generation sector of the WEM
-
Hypothesis: 5% annual increment of demand,
3000 MW exports to Brazil, no imports from
Brazil, no exports to Chile, level increment of
Yacyretá dam
-
Results: future installation before 2020 of
32000 MW mostly in thermal power units
Energy Exchange
G9
EE7
EE3
G4
G5
G8
EE4
EE6
EE5
EE1
G1
G10
G2
G3
GAS
con CHILE :
G1: GASANDES - 2,5/5 MMm3/día
G2: SAN ISIDRO - 1,8 MMm3/día
G3: AGUADA PICHANA/S.ROQUE - 1,58 MMm3/día
G4: NORGAS - 3,7 MMm3/día
G5: ATACAMA - 2,5 MMm3/día
G6: METHANEX (1) - 2 MMm3/día
G7: METHANEX (2) - 2,75 MMm3/día
con BRASIL :
G8: URUGUAYANA - 2,5 MMm3/día
G9: BRASIL - 5 MMm3/día
con URUGUAY :
G10: URUGUAY- 1,5 MMm3/día
ELECTRICIDAD
P1
con URUGUAY :
EE1: Salto Grande (500kV) - CH Binacional 1890 MW
C.Elía-San Javier (500kV) – Contrato 400 MW firmes
con PARAGUAY :
EE2: El Dorado-C.A. López (132kV)
EE3: Clorinda-Guarambaré (220kV) – 150 MW no firmes
EE4: Yacyretá (220kV) - CH Binacional 2700 MW
con BRASIL :
EE5: P.Libres-Uruguayana (132kV) – 50 MW no firmes
EE6: Garabí (500kV) – Contrato 1000MW firmes
con CHILE :
EE7: Güemes-Atacama (345kV) - 630 MW, 5000 GWh/año
G7
G6
PETROLEO
con CHILE :
P1: 15 Mm3-día