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Feature: Central America’s landmark interconnection project

By the Potencia correspondent

Work on the Central American Electrical Interconnection System (known as Siepac in Spanish) almost completed. The final stretch in Costa Rica is due to be finished in April, whereupon all Central American countries from Guatemala to Panama will be connected. This represents a key landmark in terms of energy integration in the region.

With the exception of Belize, which is primarily supplied by Mexico, all Central American nations – Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica and Panama – will be able to buy and sell electricity from each other through this interconnected system that covers almost 1800 km.

According to Proyecto Mesoamerica, 282 km traverses Guatemala’s territory, with a similar across Salvadoran soil. The high-voltage transmission line then enters Honduras for 270 km.

In Nicaragua, Siepac covers over 300 km, but the country with the longest stretch is Costa Rica with 493 km. Finally, the line enters Panama, where it has a distance of 150 km.

Official figures from the Regional Operations Entity (Empresa Proprietaria de la Red – EPR) show that Siepac system comprises over 4600 high voltage towers and 15 substations – three in Guatemala, three in El Salvador, two in Honduras, two in Nicaragua, four in Costa Rica and one in Panama.

The EPR is an association consisting of public and private companies from the countries involved in Siepac. Each company holds an 11.1 per cent share in the EPR.

Guatemala joined the EPR via its National Electrification Institute (INDE); the Executive Hydroelectric Commission of the Lempa River (CEL) represents El Salvador; Honduras’s representative is the National Electric Power Company (ENNE); Nicaragua is represented by the National Electric Transmission Company (ENATREL); Costa Rica by the Costa Rican Electricity Institute (ICE); and Panama by the Electric Transmission Company (ETESA).

Extra-regional partners in the EPR are Colombia’s state-owned grid operator, ISA, the CFE of Mexico and the Spanish utility major Endesa.

The Siepac project has been financed by $500m from several organizations, including the Inter-American Development Bank and the Central American Bank for Economic Integration.

According to Jose Enrique Martinez Albero of the EPR, Guatemala is the country with the greatest potential to supply power to its neighbours. Conversely, both Honduras and El Salvador are expected to rely more heavily on imports.

Panama’s Ministry of Energy and Mines believes that the Central American region will benefit considerably when Siepac is working at full capacity.

La Estrella, a Panamanian newspaper, reported that officials from the Executive Council of the Regional Electric Market met in February in Nicaragua’s capital city Managua to study the impact of Siepac in the region.

It is reported that Siepac is already operating commercially, excluding a short stretch still under construction in Costa Rica, with 130 km still to be energized.

La Estrella cited Honduras’ deputy energy minister Dario Carmona, who emphasized the greater energy security that Siepac will bring to Central America.

Carmona said that countries will be able to produce more and cheaper energy thank to Siepac. The report added that even though the line can transport up to 300 MW at the moment it is expected to reach up to 600 MW in the future.

However, El Economista Centroamerica warns of a legal problem facing the operation of the Siepac operation system, namely the lack of regulation that establish the terms and conditions of the transmission of electricity between El Salvador and other countries in the region.

Aiming to reassure, the Regional Electric Interconnection Commission (CRIE) said that Siepac’s rules would be published and implemented in April.

The executive secretary of El Salvador’s National Energy Council (CNE) said that currently the countries of the region buy and sell energy from each other under provisional rules.

Siepac aims to establish legal, institutional and technical rules that enable the creation of a regional electricity market that encourages the involvement of private companies in the development of the capacity additions.

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