The legal framework for electricity transmission across boundaries in the Andean Region

Abstract

Latin American countries have diverse rules for regulation of the electricity sector, specifically in the transmission phase. Despite technical and political diversities, some regions of the continent have been more successful in developing interconnection of their electricity markets in order to be economically efficient and prevent sudden outages for additional demand. Central American countries have achieved electricity integration (beyond interconnection), after a lengthy process of negotiation between the countries, with the support of international organisations. The key step was the cession of government powers to a supranational entity. In the Andean Region case, overcoming the reluctance of ceding sovereignty is likely what has prevented moving forward on electricity integration, as the infrastructure would make it possible.

Keywords:

• electricity interconnection
• transmission
• electricity integration
• Andean Region

Notes

1 Section 1 of the Constitution of Argentina and s 18 of the Constitution of Brazil.

2 Even though the constitution establishes that the states are owners of the natural resources located in their territories and can sign international treaties, provided that they are compatible with the foreign policy of the federal government.

3 Such as Bolivia, Ecuador and Venezuela.

4 Constitution of the Republic of Peru, s 60.

5 Constitution of the Republic of Ecuador, ss 313, 315 and 316.

6 Law No 28.832, s 12.

7 LOSPEE, s 25.

8 Law 143 of 1999, s 34, b.

9 Julia Antmann and others, La Infraestructura en el Desarrollo Integral de América Latina: Diagnóstico estratégico y propuesta para una agenda prioritaria (Corporación Andina de Fomento 2011) 18.

10 Ibid, 31.

11 Fabio García, ‘Panorama General del Sector Eléctrico en América Latina y el Caribe’ (Organización Latinoamericana de Energía 2012) 43.

12 Ibid, 44–45.

13 Daniel del Barrio-Alvarez, Shunsaku Komatsuzaki and Hideyuki Horii, ‘Regional Power Sector Integration: Critical Success Factors in the Central American Electricity Market’ (2014) 7(12) OIDA International Journal of Sustainable Development 119, 121 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2573105 accessed 5 May 2017.

14 Ibid, 125.

15 Ibid.

16 David Reinstein and others, ‘Regional Power Integration: Structural and Regulatory Challenges, Central American Regional Programmatic Study for the Energy Sector’ (World Bank, Report No 58934-LAC, January 2011) 34.

17 Ibid.

18 Ibid, 67.

19 Daniel del Barrio-Alvarez and others (n 13) 133.

20 See Ministerio de Electricidad y Energía Renovable, ‘Iniciativa Ecuatoriana de Integración Eléctrica de la Region Andina avanza con pasos firmes’ www.energia.gob.ec/iniciativa-ecuatoriana-de-integracion-electrica-de-la-region-andina-avanza-con-pasos-firmes accessed 7 June 2017

21 Medardo Cadena, ‘Sistema de Interconexión Eléctrica Andina (SINEA)’ (Sustainable Energy Week, Panama City, Panama, September 2016) www.slideshare.net/OladeComunicacin/xifier-06-sistema-de-interconexin-elctrica-andina-sinea accessed 7 June 2017.

22 Andean Community Gazette, Year XIX, No 878, Lima, 12 December 2002.

23 Declaración de Santiago para la interconexión e integración eléctrica andina, Santiago, 4 September 2015.

24 However, as we explained earlier, politics and ideology are unfortunately intertwined in the decision-making process. See ‘Proyecto Sistema de Transmisión 500 kv’ which shows how Ecuador decided to publicly fund a system that could have been easily ceded for private development www.celec.gob.ec/transelectric/images/stories/baners_home/LOTAIP_NEW/2015/03-2015/m_mecanismos_rendicion/Pry_Sistema_de_Transmision_500_kV.pdf accessed 9 June 2017.

25 Gabriel Di Bella and others, ‘Energy Subsidies in Latin America and the Caribbean: Stocktaking and Policy Challenges’ (2015) International Monetary Fund Working Paper WP/15/30, 25.