How do you see Panama's energy mix evolving, and what would be the ideal balance of energy sources?
We currently operate on an energy matrix of 55% hydro, 6% wind, and less than half of that through solar. We hope to be sourcing around 75% of our energy from renewables by 2018, meaning hydro will stay more or less where it is now, but we will have a 12% increase in wind and a little bit more than that in our use of solar. The important thing is that the new solar and wind generators will produce energy when there is no rain. It will be an excellent complement to the existing capacity, as Panama has a different peak ratio of demand than the rest of the countries in the area, such as Colombia and those of Central America, due to the fact that we mainly use electricity for air conditioning rather than for industry. We peak during the peak of the sun; therefore, solar and wind perfectly match our demand. They produce water and energy when there is no rain so it is an excellent form of coverage and a natural hedge.
What are some initiatives to increase energy integration in the region?
We already have a capacity of 300 MW between Panama and the rest of Central America all the way to Guatemala. We are currently expanding our national grid, so we will be able to add a further 300-400 MW of capacity between Panama and Costa Rica. We have three connections with Costa Rica, and we will be able to increase that. We already have an interconnection with Central America to Guatemala, which is subsequently connected to Mexico. The other interconnection will be with Colombia. We are making great progress and have settled on a route that has been declared suitable by the Ministry of Environment. We recently received permits to conduct feasibility studies on the road and the transmission line. We will do those in the coming months and present our findings to the general congress. With a second approval, we can then do an environmental study and probably start work in 2017. We have a 130km undersea power line that will leave Panama in the Guna Yala region and extend to Colombia somewhere near Necocli in the Gulf of Uraba. From there we will continue on for another 180km toward Cerro Matoso. Once this line is operational, there will be 400 MW going both ways. If we had the line right now, we could already be selling electricity to Colombia, which would help with the big prices they are facing today.
What are some of the major projects that you plan to carry out in 2016?
We have an intensive investment program and an expansion plan that was conceived in 2012. What we are actually doing is executing the expansion plan that was put in front of us. The first year was about getting the money to perform these projects. When I came to ETESA almost two years ago, there was hardly any money at all, yet we had a huge list of projects. We will be executing about $1 billion worth of projects in these five years. The first two years were relatively slow in terms of project execution due to a shortage of funds, but we have already secured $180 million and we have another $100 million committed for 2017. We will probably issue a $350 million 30-year bond in 2016, and our goals are to acquire the necessary capital, continue developing contracts, finish the third line on time, tender and finish the fourth line, and initiate the Interconeccion de las Americas between Panama and Colombia. The fourth line is a $500 million project and finishing the third line is a $350 million project. We are running ETESA with the mindset of a private company, even though it is owned by the government.