Statement on Bill No. 23,414 “Coordination of the Electricity Sector”

The Living Rivers Movement is a movement of people living in different rural and peasant communities in the south of the country who, for more than a decade, have defended rivers and water as common property and essential for life and development. Similarly, the Costa Rican Federation for the Protection of the Environment (FECON), a federation of environmental organizations from across the country, has been working for environmental protection and social justice for 35 years. Today we speak out Deeply outraged and utterly rejected Prior to Act No. 23,414 “Coordination of the Electricity Sector”, for the following reasons:

1. The project proposes a dangerous transfer of functions between entities and a high concentration of power, looking to transfer the governance of the electricity sector from the Costa Rican Electricity Institute (ICE) to the Ministry of Environment and Energy (MINAE). MINAE does not have the experience or capacity to play a role in the supervision, planning and management of the National Electricity System (SEN), while the efficiency and effectiveness currently possessed by ICE have been limited in the application of fiscal rules in the national budget in recent years and cuts to different ministries and social programs. In addition, this move could expose the management of the electricity system to decisions based on political considerations rather than technical or scientific criteria. Likewise, it could create a conflict of interest between the environmental and energy goals of the State.
2. The project aims to encourage private sector participation in the national electricity system by removing the maximum generation capacity cap for private power projects, allowing the production and sale of electricity in the National Electricity Market (MEN), and allowing the export of electricity. Private companies and cooperatives sell electricity without restrictions in the Regional Electricity Market (MER). Similarly, it also promotes the participation of foreign companies in the national electricity system.
3. The project’s approach is based on a mercantilist logic, where our rivers are considered an energy source for hydroelectric power. However, as we have demonstrated many years ago, hydroelectric projects cause brutal eco-social impacts, such as the destruction of natural habitats, water shortages for the population, reduced water for agriculture, hoarding of river ecosystem services by economically powerful groups, etc. Likewise, they can cause harm to our cultural and recreational forms, as well as social disputes and family divisions. Far from being “harmonious”, this project can exacerbate social and environmental conflicts within our communities and promote the appropriation of public resources by certain economic sectors, eroding heritage resources that belong to all Costa Ricans.
4. Take the example of the San Rafael hydroelectric project in Pérez Zeledón, in this case we can observe how the large construction company H. Solís (famous for the La Cochinilla corruption case) built the project in a completely irregular way, with the help of the municipality of Pérez Zeledón, the water board, ARESEP, Setena and the contract signed with ICE. This was also pointed out several times by our organizations and the communities that will be directly affected by the project, but the institutions completely ignored these signals, as well as the voices and needs of the communities that will be seriously affected by the hydroelectric plant in question. Fortunately, the project did not receive the National Declaration of Convenience from the Minister of the Environment, but it is clear how dangerous it is that the profits of private companies take precedence over the well-being of the communities, and how projects like the 23,414. proposal, if approved, will promote this.
5. The project aims to dissolve the Costa Rican Electricity Institute (ICE), seeking to transfer “… the assets, systems, movable and immovable property and other resources used for the system and market operations of the Costa Rican Electricity Institute…” to a new figure appointed the National Electricity System Coordination Entity (ECOSEN). Likewise, they intend to transfer to ECOSEN the supervisory, operational, planning and management functions of the National Electricity System and the National Electricity Market, currently carried out by the ICE. It would be a mistake to weaken the ICE, since this institution has been an important pillar of the social and democratic development of our country, since constant access to electrical energy at a uniform price has promoted the guarantee of other human rights such as education, health, work and social equality, among others.
6. Greater private sector involvement in the electricity sector does not “guarantee the lowest possible costs for consumers” because in Costa Rica we already have the privilege of having the cheapest electricity in the region. The September 2022 Global Gasoline Price Report ranked Costa Rica as the country with the lowest electricity production costs in Central America (1). This is mainly due to the efficiency of ICE, which generates 65.5% of the country’s electricity (2).

Based on the above, we reiterate our Total Rejection In accordance with Law 23,414, we urge communities, socio-environmental organizations, union members and all the Costa Rican people, as we did in 2000, to defend the ICE and electric energy model, in which, beyond the lucrative and special interests, respect is earned for human dignity, solidarity, accessibility and the common well-being of all people and ecosystems.

#RíosParaLaVida #ElICEnosevende #ElICEsedefiende

refer to:

1. Data taken from the Central American business magazine Strategy & Business: https://www.revistaeyn.com/centroamericaymundo/que-paises-pagan-la-factura-de-energia-mas-alta-de-latinoamerica-FH13145000
2. E. Rojas, Statistics of the electricity subsector in the Central American Integration System (SICA) countries, 2021, Mexico City, Economic Commission for Latin America and the Caribbean (ECLAC), 2022.https://www.cepal.org/es/publications/48602-estadisticas-subsector-electrico-paises-sistema-la-integracion-centroamericanA)