Monday, February 9, 2009

Opening the Door to Power Transmission

Now that the Technical Standard for the Expansion of the Electric Transmission System (NTT) in Guatemala is in force, it opens the doors to bids for the construction of 393,400 kilometers of electrical grid.

The National Commission of Electricity (CNEE) is responsible for developing the bid and the Ministry of Energy and Mines is responsible for coordinating this first phase, within three months after the NTT goes into force. Carlos Colom, president of the commission, said that the process will proceed and meetings will convene throughout the remainder of February and March.

The projects include construction of a five-ring network to link up the transmission system and create alternate routes to transport electricity in the event of failures or accidents that cause the suspension of electric service. An estimated investment of U.S. $504 million will go to the companies that win competitive bids.

In addition, the paper published two-days ago in the Official Gazette, set out the rules, procedures, and mechanisms that persons wishing to perform works must comply with when tendering bids. It also sets out the rules for defining the priorities of projects and updating the system every two years. The proposals must also define expansion scenarios, projections of demand, technology, investment and other costs. In addition they should include features aimed at helping to reduce the total cost of the electrical transport system and identify projects that encourage the development of power generation projects, especially renewable resources.

Approval of the environmental impact studies will be the responsibility of the companies contracted to perform the work. The CNEE will support them in defining and obtaining rights of way.

The payment for the work will be done in two periods. The depreciation will be based on an annual fee and the during operation the carrier will receive a toll set by the commission.

According to the CNEE, the goals is to lower the costs of electric service and mitigate severe failures that cause disruptions in the system.

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