Sunday, July 24, 2016

This is a solution to Venezuela’s Electricity Crisis

Is Venezuela a victim of its own economic success?

The government has recently announced the shifting of Venezuela’s time by 30 minutes – an effort aimed at reducing the amount of electricity used for lighting. This is the latest of the drastic measures launched by the government to curb power consumption, which also included implementing load shedding for four hours a day across multiple states, enforcing leaves for public-sector employees for three days a week, closing of schools on Fridays, mandating malls and hotels to generate their own electricity for nine hours a day, and requiring heavy industries to cut electricity usage by 20% else they could face hefty fines.

Because of this scenario, there is tension between the government and the people. The people of Venezuela are calling for more than palliative solutions: They are clamoring for an urgent definitive resolution of the power crisis that has aggravated the country’s precarious economic situation. If the escalating tension is any indication, Venezuela will continue to reel from the effects of a deteriorating public security, social stability and economic viability, unless the severe power shortage is urgently redressed.

Electricity Minister Luis Motta looks at the massive Guri Dam, virtually dry because of the drought.
Courtesy Reuters.

How did things get so bad?

Venezuela heavily relies on hydroelectric power from the Guri Dam, which, according to estimates, provides more than 60% of the country’s electricity. While hydropower is usually a clean and reliable source of electricity, a prolonged drought or a persistent absence of rain can cause water levels in reservoirs to fall below what is necessary to spin the turbines in dams. This is what is happening to Venezuela in the face of the El Niño weather phenomenon. Reuters reported that in early April 2016, the water level at the Guri Dam is already at its historic low of 797 feet.

Countries that rely on hydroelectricity need a sufficient back-up power infrastructure that will support the supply of electricity when the water in reservoirs run dry. Unfortunately, Venezuela does not have one that can respond to its present electricity requirement. But, that is not to say that the country did not invest in its electrical infrastructure. In fact, according to Victor Silverman, historian at the Pomona College, in an interview published by, Venezuela invested around USD 10 billion in electrical generation under the presidency of Hugo Chavez. The problem, however, is that electricity consumption fast outstripped the available supply.

Courtesy Energy Information Administration

During the presidency of Chavez, Venezuela saw a notable decline in poverty, as the World Bank reports that the country decreased its poverty rate from 50% in 1998 to 30% in 2013. This meant that a great number of Venezuelans enjoyed an improvement in their standard of living, and an increased availability of money, which allowed them to purchase items that consume electricity, like TVs, refrigerators, air conditioners, and blow dryers, among others.

During that time, Venezuela, which has one of the world’s largest oil reserves, was also reaping the economic advantages of high oil prices. Wired reports that the country channeled the revenue from oil exports into social programs that improved the quality of life of its citizens. Not only did the government made healthcare and food more affordable, it subsidized fuel and electricity, and froze power rates. This prompted Venezuelans to consume electricity at a higher rate compared to other countries in Latin America.

Numbers from the US Energy Information Administration supports this: Between 2003 and 2012, Venezuela’s electricity consumption increased by 49%, largely owing to the economic and social improvement under the presidency of Chavez. However, installed capacity expanded by only 28%. This wide disparity took a toll on the country’s power grid.

The drought of 2009-2010 caused the water level at the Guri Dam to nosedive. According to, what ensued was a power shortage that forced to government to implement rolling blackouts, forced holidays and fines for heavy electricity users, like businesses, factories and mines. In the months after, added Vox, the government spent USD 1.5 billion to procure and install back-up generators throughout the country. But, owing to a lack of maintenance, the supplemental generators were not properly utilized, leaving the country’s transmission lines overburdened and unable to handle major electricity fluctuations.

Analysts say that the electricity crisis in Venezuela was never genuinely resolved from that point on. Further blackouts hit the country from 2012 to the present, and the people of Venezuela are losing hope of ever seeing an end in sight.

How can the power crisis be resolved?

Quoting energy experts, to provide a long-term resolution to Venezuela’s power crisis, the country needs to upgrade its existing dams, install reliable sources of back-up power plants in times of drought and prolonged low-rain seasons, and refurbish its transmission and distribution grid. This can be achieved through a well-executed investment plan, which requires a sizeable amount of financial resources and a competent oversight.

Unfortunately for Venezuela, the country’s economy has been severely hit by the collapse in oil prices over the past few years.  The days of buoyant revenues from oil exports have sailed, and now the government finds itself cash-strapped and deeper into debt. The country is now struggling with food shortages, and scarcity of basic goods and medicines, and with the prevailing power crisis, analysts predict that the country’s economy will deteriorate even further.

What Venezuela needs are viable power solutions that will provide reliable electricity to its industries and, consequently, spark a sustainable economic recovery. What Venezuela needs are affordable power solutions that will not require millions of dollars to buy, construct and maintain. What Venezuela needs are immediate power solutions than can be rapidly delivered and installed, and can supply consistent and reliable power within days and not years.

Multi-megawatt temporary power solutions can pave the way for a decisive resolution of the power crisis in Venezuela.  

In this time of economic recession and a devastating power crisis, Venezuela and its heavy industries will find considerable benefits in hiring the services of temporary power providers. By choosing temporary power plants, there will be no need for the Venezuelan government nor for industrial companies to spend scarce resources on capital expenditure, which is usually the case when procuring power equipment or building permanent power facilities. The government or the industrial companies can conveniently pay for the rented electricity from their operating revenues. As operations grow and the requirement for electricity increases, the government or the industrial companies can simply choose to add more power modules to the existing power plant, precluding the need to buy additional equipment or build other permanent facilities. Likewise, in case the power requirement decreases, the load of the temporary power plant can be proportionally adjusted.

The latest temporary power plants do not require heavy civil works, and can be connected to the grid regardless of its quality or age. There will be no need for extensive site preparation nor for the refurbishment of the transmission and distribution grid prior to operating temporary power plants. Owing to this, as soon as the generators and other equipment arrive on site, they can be installed, commissioned and powered on within days. In a matter of days, the country and its industries will be supplied with consistent and reliable electricity.

Temporary power providers offer a full range of service that includes the operation, maintenance and servicing of temporary power plants. The government or the industrial companies will be relieved of any responsibility in running or maintaining the power plants, thus can focus on their more essential functions. Temporary power providers have expert in-house engineers that will ensure that the power plants run at the optimal level at any given time.

As soon as the requirement for supplemental power passes, the government or the industrial companies can simply choose to end the contract with the temporary power provider. The entire temporary power plant will be demobilized, leaving no idle power equipment nor permanent power plants that will require constant maintenance.

There is a solution

Such a debilitating power shortage is not unique to Venezuela. Hydropower-dependent countries around the world are suffering from the same problem, and are struggling to find a viable solution. At times, governments and power utility providers are content with merely mitigating the effects of the power crisis, thinking that curative solutions will take enormous amounts of resources and years, sometimes even decades, before completion. There are sustainable answers to the world’s most pressing power problems, and one of them are temporary power solutions. Paradoxical as it may, turning to temporary power solutions can open doors to a long-term resolution of even the most severe of power challenges hounding our world today.


Sources consulted:

“The roots of Venezuela’s appalling electricity crisis”, 

“Venezuela’s economic success fueled its electricity crisis”,

Altaaqa Global
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