December 2014

Masters in International and Development Economics, MIDE.HTW Berlin

Energy Security with Renewable Sources: Is it possible for Costa Rica?Jehykin Umaña Mayorga (s 0547767)Final essay for the subject of Environmental Economics Prof: Christine Werthman Winter Semester 2014

Table of Contents

Introduction...................................................................................................................................................... 3

Energy Security................................................................................................................................................ 4Definition........................................................................................................................................................................ 4Relevance....................................................................................................................................................................... 4Parameters to measure energy security............................................................................................................. 4Options to achieve energy security....................................................................................................................... 5Feasibility of continue use of “dirty” electricity................................................................................................6

Renewable energies....................................................................................................................................... 7Definition........................................................................................................................................................................ 7Types of renewable energies................................................................................................................................... 7Advantages of Renewable energies....................................................................................................................... 8Potential of Renewable energies......................................................................................................................... 10

Security of electricity supply in Costa Rica through renewable energies..................................10Background of the electricity situation in Costa Rica...................................................................................10

ICE (Costa Rican Electricity Institute)...............................................................................................................................10Different sources of energy used in Costa Rica..............................................................................................................10Central American Electrical Interconnection System.................................................................................................12Consequences of the high cost of electricity in Costa Rica.......................................................................................12

Potential of renewable energies in Costa Rica................................................................................................13Challenges for the future of clean electricity generation............................................................................13Advantages of investment in renewable energies in Costa Rica...............................................................14

Conclusions and Recommendations....................................................................................................... 15Electricity Security in Costa Rica through renewable energies: Is it possible?...................................15Future of electricity in Costa Rica........................................................................................................................ 15Challenges to overcome.......................................................................................................................................... 16

Bibliography................................................................................................................................................... 18

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IntroductionThe environment has suffered the consequences of the development of the world in the last century,

and the effects are, now, more tangible than never before. Global warming, melting of the ice caps,

increase in the sea level, droughts, floods… natural disasters in general are everyday-topics in the

news, a reality for millions around the globe and the cause of death for as much as 160,000 people

each year, according to the World Health Organization. But this development era that has affected the

environment has brought less than 20% of the population to a stage of “development”, according to

the data provided by World Bank.

No doubt that assuring the energy supply and, specifically electricity, is a key factor to bring welfare

and development to the remaining 80% of the population and the future generations. Therefore, we

should ask ourselves: What impact will it have in the environment to take 80% of the population to a

status of “development? Can we afford to do it in the same way that the now-developed countries did

it in the past? Is there another way?

The seventh Millennium Development Goal (MDG) is to “ensure environmental sustainability”, but just

the first two targets are focused on “sustainable development” (7.A) and the lost of “environmental

resources and biodiversity” (7.B), whereas the other targets are more focused on “access to safe

water and sanitation” (7.3) and the “improvement in the lives of slum dwellers” (7.4) (United Nations,

2011); all of them, with no specific guidelines or real and measurable targets (except, maybe, for the

fourth target). This can give us a hint of the importance of the environment on the agenda of

development.

This paper will analyze the concepts of “energy security”, focused on the supply of electricity, as well

as “renewable energies”, in order to answer the question of whether or not is it feasible to assure the

necessary provision of electricity through renewable energies; all this focused in the case of Costa

Rica, a developing country that has a strong commitment with the environment protection, a goal of

achieving carbon neutrality for 2021, immense potential for renewable energy production and interests

in continuing being an example when it comes to good practices regarding environmental policies and

biodiversity protection.

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Energy Security

DefinitionThe International Energy Agency defines energy security as “the uninterrupted availability of energy

sources at an affordable price” (IEA, 2014). This already gives us a wide but clear description of two

important elements that have to be considered when discussing energy security, which are

“availability” and “affordability. Moreover, according to Asif and Muneer (2007), energy security

“means consistent availability of sufficient energy in various forms at affordable prices”.

Even though some authors, when talking about energy security, might cite the “four A’s of energy

security: “Affordability, Availability, Accessibility and Acceptability” (Jewell et al, 2014), Jewell et al

defined the term as “low vulnerability of vital energy systems, delineated along geographic and

sectorial boundaries” in order to create a framework that will facilitate to measure and compare the

energy security in the future, when the matrix of energy in the world had, hopefully, evolved.

Furthermore, Jewell et al define the vulnerabilities in terms of sovereignty, robustness and resilience

and give a very interesting and multidimensional way of approaching the boundaries, both in

geographic, as well as in sectorial boundaries such as energy sources, energy carriers and energy

end-uses.

RelevanceImagine a country were you have no security on how much the price of the electricity for the next

month will be, or whether or not you will have a constant supply of electricity for the production of the

goods or services that you want to produce. Would you invest in a country like that? How can the

business community or entrepreneurs work under that uncertainty? Moreover, what would be the

implications of blackouts on sectors such as national security or medical attention in a country that

does not have a secure supply of electricity?

Whether we are talking about legal, political, economical, energy or national security; stability is

necessary for investment, just as investment is necessary for development. This are just examples of

why energy security is such a relevant topic nowadays.

Parameters to measure energy securityEven when many authors have developed a long list of indicators to measure energy security in order

to compare either the development of it across the countries for a determined period or to evaluate the

development of energy security of a country or region over the time, Jewel et al have listed a set of

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indicators that can be used, even if the energy matrix evolves to a low-carbon scenario. These

indicators include: global energy trade, geographic diversity of exports, net import dependency, energy

intensity, diversity of energy sources in primary energy supply, diversity of primary energy sources in

carriers, diversity of primary energy sources in end-use sectors and a set of robustness indicators.

Even thought the definitions and formulas of the different parameters to evaluate energy security

mentioned above might be of interest for the reader, as the end of this paper is not to evaluate the

energy security of any country, we will no go further on the definitions or formulas of these indicators,

but refer the reader to the above mentioned article for further information on the parameters. What is

important for the purposes of this paper is to keep in mind the indicators when discussing the concept

of energy security.

Options to achieve energy securityJust like in the world of investment, diversity is a key word for energy security. Most of the countries

have an energy matrix with a variety of sources for the production of electricity and this is reflected in

the data of the World Bank that indicates that, as 2011, just Albania and Paraguay (Hydro), Bahrain,

Quatar and Turkmenistan (Natural Gas) and Bostwana (Coal) depended on only one source for its

generation of electricity.

As we can see in figure 1, the world in average has a rather diversified matrix of sources for its

electricity generation, but more than two thirds of its sources (coal, oil and natural gas) liberate carbon

dioxide to the atmosphere in the process, whereas nuclear power, as appointed by Sackett (2001)

faces challenges of the radioactive waste and safety.

Coal42%

Oil4%

Natural Gas22%

Nuclear power12%

Hydropower16%

Renewable4%

Sources for Electricity GenerationWorld AVG, 2011

Source: World Bank, 2014Fig. 1

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Feasibility of continue use of “dirty” electricityAs shown in the previous figure, the world relies in “dirty” sources of energy for the production of

electricity but, is this sustainable? Can we continue burning coal, oil and natural gas as we have done

it in the last years?

First, we should take into considerations whether or not are there enough reserves in the world to

keep on the same pattern of electricity generation. Despite of the fact that we have been hearing for a

long time now that the reserves of oil will “soon” be consumed, more and more reserves had been

found in the past years but, according to the BGR (2004), we had left less than 50 years of reserves of

fossil fuels, not just for electricity generation, but for all energy related purposes, including

transportation. Moreover, according to a statistical review of world energy released by British

Petroleum in 2003, the reserves to production ratio of fossil fuels for North America was only of 10

years –although they have not yet ran out of fossil fuels and, actually, are currently exporters of

natural gas– whereas Europe and Eurasia had a ratio of 57 years.

The price of oil just dropped during the last months due to different reasons such as the increase in

production of the United States, the return of Libya to high production levels, the war price that some

countries at OPEC have had in order to maintain their market share in Asia, among other factors.

Nevertheless, oil prices in the last years have been around $100 per barrel, not to talk about the peak

of $140 during 2008, as can be seen in figure two. Taking into consideration the volatility of the prices

of oil, one would expect the countries not to rely on oil in order to secure the supply of electricity.

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Cost per barrel of oil2004 to Nov 2014

Fig. 2 Source: World Bank, 2014

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Finally, one (if not the most important) factor to be taken into consideration is the impact in the

environment that the usage of dirty sources of energy for electricity generation can cause on the

planet. Dincer and Rosen (1996) estimate the increase in the global temperatures between two and

three degrees for 2100 and the consequences of a warmer world, such as (i) an increase in the sea

level (with its secondary effects), (ii) changes in the hydrological cycle and the ENSO phenomenon

with consequences such as droughts and floods, etc., (iii) the changes in the biodiversity and the

spread of diseases and plagues that usually live just in the tropics, (iv) the negative impact in

agriculture and the effects that this will have on food security, among many others, have been largely

discussed over the past decades and the cost, both in economic terms and in lives, has become more

and more tangible during the last years.

Renewable energies

DefinitionWe could define renewable energies as those sources that do not depend on a supply of a limited

input such as coal or oil, but rather are rapidly regenerated and use the energy of free sources such

as the sun and the wind. Also, renewable energies have an impact on the environment close to zero,

as there are no greenhouse gases liberated to the atmosphere in the process of exploiting them.

Types of renewable energiesi. Hydro: This is defined as the use of the mechanic force of the water, when falling or

running, to move the turbines in order to produce electricity. This is one of the oldest

renewable ways of producing electricity, but also one of the most used across the world;

actually, according to Herzog et al (2001), more than 150 countries use hydropower to

produce electricity.

Although tidal energy is usually counted as a separate type of energy, as it comes from

the mechanic force of the water bodies, we could classify it also as hydro.

ii. Wind: Just as the hydropower, the mechanic power of the wind has been used by

humans for centuries now, but the popularity of wind power for electricity is rather recent.

Wind power is becoming more and more common thanks to the decrease in cost of the

turbines, mainly due to the increase in the research and development, and the different

companies that are investing in the production of this type of technology. It should be

mentioned that there are two modalities of wind power production, in-land and off-shore,

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each one with particularities in terms of technology, cost and production, being the most

common the in-land production.

iii. Solar: Solar power might refer to the photovoltaic or solar thermal technology. Solar

photovoltaic modules convert sunlight directly into electricity, by using semiconducting

materials. In the other hand, solar thermal technology uses the energy of the sun to heat

an “intermediary fluid” that then generates steam, which moves the turbines (Herzog et

al, 2001).

iv. Geothermal: The principle of the geothermal electricity is to use the heat and/or the

steam that is in the core of the Earth, in order to move the turbines to produce electricity.

Geothermal, just as the other renewable sources has been used for centuries for other

purposes, but until recently for electricity production.

v. Biomass: This is one of the most varied types of energy when it comes to renewables.

We could define biomass power as the usage of the organic materials that are the result

of the biological process of photosynthesis. Biomass, in the field of electricity, is mostly

used by burning organic material to heat an “intermediary heat” to move a turbine and

then generate electricity. Waste-to-energy can be included in this category and it also

includes the using waste to create gas or biofuels.

Advantages of Renewable energies First of all, renewable sources are free. No one has to pay for the sun that falls on its land, nor the

water that runs through the rivers. In contrast with fossil fuels, that have a fluctuating price, the

renewable energies don’t need any type of input that has to be paid for. In the other hand, renewables

have the particularity that the capital cost is higher, which could make it harder for developing

countries to afford it (Swift-Hook 2013).

Secondly, renewable energies are constant and/or supplementary. Tidal and geothermal energies are

pretty much constant having on a regular basis the mechanic force of the tide and the steam or heat

coming out o the earth. Regarding complementarity, the hydro power complements very well with

solar and wind power in the countries during the different seasons in the year; also, the wind and the

sun complement each other in different countries according to the geographical latitude (or zones), as

presented by Asif and Munner (2007).

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Moreover, renewable energies are better distributed across the world than fossil fuels. For example,

according to the statistical review of British Petroleum (2003) the distribution of the oil reserves in the

world were as follows: 2% in Europe, 4% in Asia Pacific, 6% in Former Soviet Union, 6% in North

America, 7% in Africa, 9% in Latin America and 66% in Middle-Eastern countries; situation that has

not changed as 2013 where, according to OPEC (2014), Middle-Eastern countries still have 66% of

the reserves. This uneven distribution might cause tensions and conflicts between needed and rich oil

countries as has been suggested for many political experts in the last years; these conflicts could be

avoided if the energy supply could be secured by cheap, constant, renewable energy sources.

Furthermore, the social benefits of the renewable energies in terms of job creation cannot be

neglected. Even when renewable energies are capital intensive, which makes it hard for developing

countries to afford them, according to the National Renewable Energy Lab (1997), renewable energies

create three times more jobs for each US dollar of investment than the jobs created for the fossil fuels.

Also, usually renewables are developed in rural areas where jobs are scare, therefore, one project

such as a hydro or thermo plant can bring welfare to a, otherwise, economically depressed area,

generating second round effects in the local economy. Additionally, it is common than the firms that

are involved in big energy projects develop different social programs in the community in order to

compensate for the possible impact that the project can have in the area.

On the other hand, some renewable energy production can be done at a small scale, with the

consequences that this has for to the capital and technological challenges that electricity generation

often causes. Across the world, we see more and more programs that have as the main objective

taking small solar plants to the rural areas to produce electricity and bring the habitants of these areas

the benefits and development that comes with access to electricity.

Finally, as it has been broadly discuss, and remarked at the beginning of this paper, renewable

energies have close to zero carbon dioxide emissions, which will help us achieve a reduction on the

greenhouse gases and, therefore, will reduce global warming and its effects on the environment and in

human life.

Nevertheless, we should not overlook at the complications that renewable energies can bring with. As

mentioned before, the price of a windmill, or a hydro plant is rather high, which makes it hard for

developing countries, which are usually capital scare, to develop such projects. In addition, we should

take into consideration the social impact that such projects could have in the local communities.

Although we have said that a renewable energy project creates more jobs in a community in

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comparison with fossil fuels, the people that has to be expropriated for the construction of a dam, or

the neighbors of a wind farm that have to deal with the noise and the “visual pollution” that some of

them could argue, should be taken into consideration, measured and compensated in an adequate

way.

Potential of Renewable energies.Although there is uncertainty on what the future for renewable energies in the world will be, there is

consensus among the researchers and authors on the fact that the demand of energy of the world can

be fulfilled with renewable sources “many times” (Asif and Munner, 2007). Nevertheless, the mix of

sources to provide humans with the energy needed to reach a high status of development is not clear,

and experts like Andreas Jess (2010) suggest that the potential of non-solar renewables sources is

not big enough, and that we should focus on solar and/or nuclear energy.

Security of electricity supply in Costa Rica through renewable energies

Background of the electricity situation in Costa RicaCosta Rica was the third country in Latin America, after Chile and Brazil to have a city lighted with

electricity, inaugurating the public lighting of San José (the capital) in 1884, when two entrepreneurs

used a waterfall of 15 meters to produce hydro electricity.

ICE (Costa Rican Electricity Institute).In the period of 1884 to 1948 there were some other small, hydro plants created by private firms, but

the service provided by those companies was bad; as a consequence, the government created in

1949 the Costa Rican Electricity Institute (ICE, for its initials in Spanish), with the mandate to develop

the sources of energy in the country and to provide with the service to all the population in the country

(ICE, 2014). As 99% of the population in the country has access to electricity, we could say that the

mandate given to the institution years ago, in terms of providing electricity to the population, has been

successfully achieved; nevertheless, there are other sources of electricity in the country that have a

huge potential and that have not been exploited at its full potential.

Different sources of energy used in Costa RicaThanks to the geographic and topographic conditions of the country, Costa Rica has been able to

have a very diversified energy matrix that includes a wide range of sources. As can be seen in the

figure number 3, the country has opted to use mostly renewable sources, with 80% of its installed

capacity in clean energies.

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Hydro65.97%Geothermal

7.00%

Wind5.00%

Biomass2.00%

Solar0.04%

Oil19.99%

Installed capacity of electricity generationCosta Rica, 2013

Fig. 3 Source: Orozco, J, 2014

But as a country committed with the protection of the environment, the use of thermal plants is left as

a last resort; even when the installed capacity of the country for thermal plants is 20%, during 2013,

just 12% out of the 10,136 GWh produced in the country was produced with oil, as can be seen in

figure 4.

Hydro67.00%

Geothermal15.00%

Wind5.00%

Biomass1.00%

Oil12.00%

Generation of electricity Costa Rica, 2013

Fig. 4 Source: Orozco, J, 2014

Costa Rica, just as most developing countries, does not have nuclear plants, most likely because of

the cost and the possible risks that this carries. Also, the country does not have yet any tidal energy

projects, but the ICE has already started the evaluation of different places where such plants could be

developed in the future.

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Central American Electrical Interconnection System Since the 70’s, the idea of a line that connects all Central America to sell and buy electricity was

gestated, and in the late 90’s the different congresses of the 6 countries approved the tools and

bodies to make the project a reality. This was finalized last October, when the last part of the line in

Costa Rica started working; nevertheless, even when the line was not finished, the trade of electricity

among the country and its neighbors started since 2012 (EPR, 2014). Actually, for the months of

January, February and March of 2014, Costa Rica imported the 2, 4 and 7 percent of the total demand

of electricity, taking advantage of the low prices relative to the cost of the old, inefficient thermal plants

that were usually used during the dry season to secure the supply of energy (Fornaguera, 2014).

Consequences of the high cost of electricity in Costa RicaDuring the year 2014 Costa Rica faced the contraction of one of the biggest and more important

companies in the country: Intel. This firm opened its fist plant in Costa Rica in 1997 and expanded it

through the years to become one of the biggest employers and producers of the country, but last

March the company announced the move of the plant of microprocessors to Asia, which meant the

lost of 1,500 jobs. Moreover, Bank of America, who had a call center and a shared services center in

the country decided to close its operations last April, adding another 400 jobs to the approximately

6,000 total loss of jobs in the country for the last year (Gutiérrez, 2014).

Intel officially stated that moving the operations to Asia was part of a strategy to be more efficient, but

some people in the media and in the business community speculated that the high cost of production,

specially electricity, was one of the main causes. Bank of America was much more straight forward

and in the press release they mentioned that the high cost of electricity was one of the main causes to

close operations in the country; Costa Rica, they said, has become less competitive.

But, are the prices of Costa Rica really more expensive than its neighbors? According to the last

comparison available, made by ECLAC (2012), the prices of the electricity in Costa Rica during 2011

were similar to the rest of Central America, which differs with what the chambers and some firms have

said during this year. Nevertheless, when we compared the 34,33 Costa Rican Colones (currency of

Costa Rica) per kwh that the firms paid on 2005 to the 88,98 Costa Rican Colones that they paid

during 2013, it is evident that the cost has increased, even more than proportional to the inflation

(González, 2014).

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Potential of renewable energies in Costa Rica Costa Rica, as discussed in the section of the sources of energy used for electricity generation, has

exploited in the past different renewable options to secure the supply to its population, relying mostly

on the hydropower and having thermal plants for the shortfalls during the dry season.

Relying on hydropower seems to be the policy of the Costa Rican Electricity Institute for the immediate

future, according to information shared by them in the last conference offered to aid donor

governments and institutions held last August. During this conference, they shared the plans of the

institution for the next five years to increase the installed capacity of the country by 924,4 MV, of which

72% will be hydropower, being the biggest project a plant called “Reventazón”, with 305 MV. Also,

they will increase the capacity of wind farms by 220 MV and plan to open a new geothermal plant that

will provide 55 MV. Finally, they plan to close one of the less efficient thermal plants that currently has

capacity for 19,5 MV.

For the long term, the institution foresees an increase of 2,300 MV in the next 20 years, compound by

650 MV of a big hydro project, 440 MV out of geothermal plants, 160 MV from efficient thermal plants

and 1,050 MV from different renewable sources that have not yet being identified. This unidentified

sources are most likely to be wind farms that had became very attractive for some private firms, but

some experts also talk about tidal and biomass projects that can grow more and more in the future.

Challenges for the future of clean electricity generationState owned enterprises in Costa Rica have the monopoly of distribution of electricity in the country,

and have a type of oligopoly on the production, as private firms are allowed to produce just 15% of the

total demand. This creates a disincentive for private enterprises to invest in renewable projects,

meaning than the ICE, specially during the dry season when the shortfalls of energy are more

common, has two different options to secure the supply and avoid blackouts: (i) import electricity from

the neighboring countries as already did at the beginning of this year, or (ii) buy oil to turn on the

thermal (usually inefficient and expensive) plants and produce electricity at high costs, and emit tons

of carbon dioxide to the atmosphere.

Furthermore, the new government of the president Solís Rivera (2014-2018) has just announced that

no more geothermal projects will be developed during his mandate, because “they are not necessary”.

This decision could be a consequence to the pressure of environmentalist groups that have being

against the exploitation of the geothermal resources in national parks, where a portion of the potential

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capacity is; but this is totally counterintuitive to the promise made by him at the beginning of his term,

when he stated that he would consider all the options available to reduce the cost of the electricity.

Also, with the decision to stop all the geothermal projects, he will also block the possible projects that

can be developed just outside the national parks.

Advantages of investment in renewable energies in Costa RicaFrom environmental to economic and political, the potential gains of renewables for Costa Rica are

very important. In 2021 Costa Rica will celebrate the 200th anniversary of its independency, and the

commitment of the country is to celebrate it by being carbon neutral, a very ambitious goal that will

require many actions, but one of the most important steps on the path to achieve it should be to

produce all the electricity needed with renewable sources. This will help us maintain the credibility that

the country has held for years in the field of environment protection, and will match perfectly with being

the country that has 25% of the total area protected is the home country of 5% of all the species in the

world.

Furthermore, the investment that is needed for the development of renewable energies –that usually

goes to rural and underdeveloped areas–, will create employment and economic welfare that will help

raise the standards of living in the direct impact areas; in addition, as demonstrated by Swift-Hook

(2013), renewable sources are usually cheaper than generating dirty energy (specially wind), which

will bring down the cost of the electricity and, therefore, will benefit all the users, from the households

to the industries (Swift-Hook, 2013).

Since 1949 Costa Rica has no army and this has helped the country to invest the money that

otherwise would had been invested in guns to education; in fact, the country has the constitutional

mandate to invest 8% of its GDP in education. It would be a real breakthrough if we could also be a

country that starts using the money of imports of oil for electricity generation, to invest it in education

or health.

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Conclusions and Recommendations

Electricity Security in Costa Rica through renewable energies: Is it possible?Because of the importance of the hydropower in the energy matrix of the country, rain is a very

relevant factor for energy security. The lack of rains during the dry season or the low precipitation rate

during the rainy season, which has as a consequence a fail in filling the dam (as has already

happened when the ENSO affects the country), plays a huge role in the energy security of Costa Rica.

But the question is whether or not we should keep on relying on hydropower, or if we should diversify

–even more– the energy matrix, having different options of renewable energies that we have not

exploit yet such as tidal; or if we should use the options that we have already developed, and that we

have proven to be efficient in, like geothermal and biomass, to produce energy that can complement

hydropower, and provide the electricity that we might lack during the dry months.

Actually, in Costa Rica, the dry season is also the windier season and the months in which the “zafra”

(name for the sugar cane harvest) takes place, providing the main input that has been used in the

country for biomass electricity generation. Furthermore, some municipalities have explored the option

of “waste to energy” or incineration of garbage to produce thermal energy as an answer to the growing

problem of waste management in the country and, at the same time, the production of electricity for

the community; although the incineration of waste will emit carbon dioxide to the atmosphere, there

are techniques to reduce the emissions even more than if the waste was just landfilled.

Future of electricity in Costa RicaAs previously discussed, the potential of Costa Rica for renewable energies is enormous. Not only in

hydropower, as the country has developed in the past, but also in wind, biomass and geothermal

power. Hopefully the country, either through the ICE or by providing the legal framework and the

appropriate environment to invest for the private firms, will continue developing new environmental

friendly options for electricity generation that can reduce the shortfalls during the dry season and also

reduce the price for the final consumers.

Moreover, the Costa Rican Electricity Institute should also be encourage to invest in research and

development to lead other types of renewable sources for electricity generation in which it has not

venture yet, in a proactive way, such as tidal, solar and hydrogen.

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Other measure than the ICE could apply is the purchase of the surplus of the small solar panels that

some households have started to install on the roof of the houses, as a measure to reduce their

electricity bill but also as an action to reduce their carbon footprint. If the Costa Rican Electricity

Institute is able to accept the surplus of this small solar panels in their grid and compensate the

households for it, instead of turning on the expensive, inefficient and pollutant thermal plants during

the dry season, the country be benefited of the previously discussed consequences and will also

incentive more households to invest in small solar panels, that are becoming cheaper and cheaper as

more firms are producing them.

Challenges to overcome.The hydro plant called “El Diquís”, with a capacity of 650 MW, located at the south of the country and

expected by the Costa Rican Electricity Institute to begin operations in 2025, is the biggest and more

ambitious project that has been undertaken in the country (and in Central America) in the field of

electricity generation. According to official information given by the Institute, this project will provide

electricity to 1,050,000 clients; taking into consideration that Costa Rica currently has five million

inhabitants, this will secure the supply of cheap and clean electricity to about 20% of the country, and

even if there is a surplus in the country, the electricity could be sold to the neighboring countries

through the SIEPAC. But this project has faced a series of obstacles, mainly the opposition of the

environmentalists that argue that the impact that the dam (of approximately 7,000 hectares) will have

in the native species makes the project unviable. Also, the indigenous populations that live in the area

oppose the project, as they will have to be resettled.

Another challenge that the country will have to overcome is in the area of geothermal electricity

production. Being this one of the most stable options for electricity generation, the sources are usually

in/or close to national parks, and the environmentalists and a part of the society stand against this type

of projects because of the impact that this could bring in the flora and fauna near them. Furthermore,

the president Solís has already stated that during his mandate the exploration of geothermal plants will

not occur. The author, who had the opportunity to visit one of this projects in the north of the country

and compared the environmental reports of the beginning of the project, when the land where the

plant is located was used as a pastureland, and the latest reports, was able to see the positive impact

of the geothermal development on the flora and fauna of the surroundings and the direct impact area.

This has been achieved thanks to the commitment of the ICE with the protection of the environment

and the supervision of the environmental institute of the country.

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Finally, nowadays the private firms are allowed to supply just 15% of the demand of electricity in the

country and, despite of the fact that an increase in the supply usually brings prices down, and that Mr.

Solís promised that he would evaluate all the different options that could reduce the price of the

electricity, he has already rejected the option of increasing the share of supply from private firms.

Furthermore, the country has failed to provide the municipalities with the legal framework that they

need to start with the systems of “waste to energy” that could help tackle the problems of waste

management and energy supply at the same time, as some congress members have argue the

possible damages in the environment for the emission of carbon dioxide, without taking into

consideration that there are technologies for carbon capture and storage that will make this option

even more environmental friendly than the current option of “treating” garbage in landfills.

If Costa Rica wants to continue being an example in environment protection, and achieve its objective

to become a carbon neutral country by 2021, it has to undertake a series of measures that will lead us

to reduce to emissions of greenhouse gases and, leaving apart the issue of transportation, the

electricity generation should be one of the first fronts that should be intervened. The technology is

available, most of the interested parts in the topic have the will to make the project of carbon neutrality

a reality, but it looks like the miscommunication –for not saying the mismatch between the personal

agendas– between the different people involved, could be a stumbling block in the path for such an

inspiring goal and the energy security that the country needs for continue in the path to development.

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