Oil powerhouse Venezuela struggles to keep lights on

Por Venezuela Real - 22 de Octubre, 2008, 12:28, Categoría: Prensa Internacional

Brian Ellsworth
Washington Post
October 22, 2008

SAN FELIX, Venezuela (Reuters) - Despite having some of the world's largest energy reserves, Venezuela is increasingly struggling to maintain basic electrical service, a growing challenge for leftist President Hugo Chavez.

The OPEC nation has suffered three nationwide blackouts this year, and chronic power shortages have sparked protests from the western Andean highlands to San Felix, a city of mostly poor industrial workers in the sweltering south.

Shoddy electrical service is now one of Venezuelans' top concerns, according to a recent poll, and may be a factor in elections next month for governors and mayors in which Chavez allies are expected to lose key posts, in part on complaints of poor services.

The problem suggests that Chavez, with his ambitious international alliances and promises to end capitalism, risks alienating supporters by failing to focus on basic issues like electricity, trash collection and law enforcement.

"With so much energy in Venezuela, how can we be without power?" asked Fernando Aponte, 49, whose slum neighborhood of Las Delicias in San Felix spent 15 days without electricity -- leading him to block a nearby avenue with burning tires in protest.

Just next door, Carmen Fernandez, 82, who is blind and has a pacemaker, says she has trouble sleeping through sultry nights without even a fan to cool her.

Experts say Venezuela for years has skimped billions of dollars in electrical investments, leaving generation 20 percent below the level necessary for a stable power grid and increasing the risk of national outages. Officially Venezuela has a capacity of 22,500 megawatts for a population of 28 million people, but a sizeable proportion is not working, analysts say.

And while Chavez has won praise for investing in health and education, his government has done little to repair local distribution systems that deliver electricity to end users, from barrio residents to business and industries.

'GOD HEARD ME'

Pastora Medina, a legislator representing San Felix and nearby cities suffering chronic power problems, this month tried to bring the issue up in the national Congress in Caracas, but the legislature's leadership refused to let her speak.
Several hours later, as the legislature discussed a South American integration plan created by Chavez, Congress itself lost power for around 10 minutes.
"Congress wouldn't listen to me, but God must have," Medina said with a chuckle as she recounted the incident later at her office in San Felix.

Though it is a key oil exporter, most of Venezuela's power comes from hydroelectricity generated in dams in the southeast, near Brazil, and sent to the rest of the country. The remainder comes mainly from aging oil-fired plants.

The transmission system is also suffering from underinvestment, which makes it vulnerable to the failures that caused this year's blackouts.

The government has responded by building dozens of tiny local plants that generate a fraction of a percent of national consumption, a model known as "distributed generation" used in Cuba, where a U.S. embargo impedes electrical development.

But to keep up with demand, Venezuela needed to add 1,000 megawatts of new generation capacity every year for at least the last five years, but instead it has installed only about 350 MW a year.

"We have to reach the most remote villages with the system of distributed generation," Chavez said in recent speech, inaugurating a generator in a town with deficient power.

His government has also promised to accelerate new generation and boost transmission grid investment.

BARRIO IMPACT

But critics say these small power plants are political quick fixes that avoid tackling the thorny problems of boosting generation and fixing decrepit distribution systems.

"We need a clear energy policy, because the policy we have is not sustainable," Andres Matas, a former planning chief for a state power company. "This is a problem for the entire country."

He said this will require investment in local distribution systems, speeding up generation projects stalled for years by bureaucracy and lifting state-imposed price controls that keep tariffs at about 20 percent of what U.S. residents pay.

It will also require collecting fees from millions of barrio residents who illegally link their homes to the power grid with improvised and dangerous lines -- a move not likely to be popular with a government that depends on barrio votes.

Even as he enjoys strong support for his oil-financed social development campaign, polls show Chavez sympathizers are losing patience with the national and local politicians' inability to tackle bread-and-butter issues.

Chavez last year fired up his supporters with a wave of state takeovers including the nationalization of electricity operations, among them Electricidad de Caracas, which was majority owned by U.S.-based AES Corp.

But his supporters now seem more concerned about deteriorating service than the state ownership.

Chronic power problems take the strongest toll in barrios like those of San Felix -- still bastions of Chavez support -- where power surges routinely burn out home appliances.

"Our refrigerators have burned out so we can't shop for the week, we can only shop for one day at a time," said Nestor Pacheco, 39. "The situation is serious."

(Reporting by Brian Ellsworth; Editing by Eddie Evans)





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