LOCAL POWER DISTRIBUTION

Costa Rica 2019 | ENERGY | B2B

Costa Rican firms have mastered many aspects of hydropower, but need more help securing long-term infrastructure financing if they are to bring their expertise to the rest of the continent.

Allan Benavides
ALLAN BENAVIDES
General Manager
Heredia Public Service Enterprise (ESPH)
Carlos Quirós
CARLOS QUIRÓS
General Manager
Administrative Board of the Cartago Electrical Service (JASEC)

What is unique about Costa Rica's market, and how can it be improved?

Allan Benavides There are several things we do here in terms of technology that are required in Central America. In Costa Rica, knowledge of the production and transmission of energy is a consolidated system, something we should have taken advantage of before and brought to the rest of Central America. In terms of drinking water, we are a successful company. We have a clear vision and the right mindset. We are already working on the realities of complex projects. In the field of infocommunications, there is more competition; for example, one of the company's more successful projects is electronic invoicing, a project that is consolidating and growing every day. We have 80 projects in development with different companies, such as in the field of telecommunications, video surveillance, and electronic anklets for prisoners. We also have projects on tax issues and software integration within this area. We have been pioneers in projects in Costa Rica and want to go out to other countries to offer these services as well.

CARLOS QUIRÓS Renewable energies have an extremely high capitalization. Once they are paid for and the investment has been made, their operations have low costs. The problem is that renewable energy requires significant investment, which makes electricity more expensive. Hydropower costs USD0.02 in operation but USD0.08 or USD0.10 during the financing stage. This situation can be mitigated by greater use. The cyclicity of renewable energies requires instruments of accumulation and alternative mechanisms to be able to use idle power in other services and applications, thus lowering the cost. For example, employing electric cars and smart technology to avoid loads at peak times. In this way, we avoid making additional investments. It is necessary to make intelligent measurements, employ IoT and, eventually, add hydrogen because it is an accumulator of energy that can be used in vehicles. We must also take advantage of renewable energies in new niches. Furthermore, when a company diversifies, the fixed costs of the electric business can migrate to other businesses, absorb those fixed costs, and generate additional income. It is necessary to optimize the infrastructure.

What are the biggest opportunities in the market, and how can they be taken advantage of?

AB Our strength is the talent that state companies have developed for many years as a result of the compulsory and free education available in Costa Rica for over a century now, which has resulted in intellectual capital in each company that overflows into other activities in a more open national or international market. Our strength lies in human talent, the ability to organize ourselves to offer services to companies that require it, the availability to compete, and the learning that is necessary to understand how excellence is maintained. In the field of infocommunications, the company has also been successful in fiber optics and the interconnection of point-to-point services. We also have the greatest experience in the country in electronic anklets, although it has been a tough project to develop. In tax issues, we were the first to work with electronic invoices. We also develop information technology projects with different institutions for their day-to-day use. The company can guarantee excellent services in the implementation of projects that have to do with the operation of many public institutions.

CQ There are opportunities in the transport sector and its decarbonization through electric mobility, which is especially important for Costa Rica because it limits the purchase of oil. The energy sector should focus on renewable sources and seek new niches because demand is slightly stagnant. There are also opportunities for us distributors. As a company, we focus on quality. Many of our customers consume little electricity but are sensitive to small voltage variations. As such, we have made great efforts to equip our industrial areas and free zones with a high level of service. We also depend a great deal on word-of-mouth recommendations. JASEC offers the lowest rate in the industrial range, which makes its high-quality services all the more desirable.