LARGE AND (ALMOST) IN CHARGE

Ecuador will soon tap into photovoltaic and wind power resources, marking a first step in its transition to non-hydroelectric renewables.

IN JULY 2019, THE GOVERNMENT unveiled its plans for the construction of three major renewable energy plants, including a photovoltaic park and two windfarms. El Aromo, the proposed solar plant, will be constructed in the Manabí province along the Pacific coast, where there is no shortage of sunny days throughout the year. The province of Loja, meanwhile, will host the two wind farms, as the wind speed averages six to eight meters per second in some parts of the Loja plateau, already dotted with 11 whirling wind turbines of the Villonaco windfarm. Ecuador is no stranger to clean energy. “85% of Ecuador’s energy is clean energy,” Carlos Pérez, former minister of energy and non-renewable natural resources, told TBY, adding that hydroelectric power generation plays the main role, with solar and wind generation remaining “marginal thus far.” Nevertheless, Pérez points out that Ecuador is “transitioning to non-conventional renewable energy.” The new renewable initiatives require at least USD400 million of investment by the private sector, to be secured in the country’s first-ever public selection process (PPS) in the renewable energy sector. “New incentives have been put in place, such as tax exemptions, payment guarantees, and the purchase of the energy generated,” according to Pérez. The talks surrounding the launching of the initiative have once again sparked debate about Ecuador’s significant potential for renewables, which has remained largely untapped, despite the woes of the nation’s electricity grid. The low share of non-hydroelectric renewables is not due to lack of awareness. The nation’s 2008 constitution clearly emphasizes the use of clean energies, giving them a special place in Ecuador’s mix of electricity generation facilities. In that same spirit, the government announced a USD7-billion initiative in 2015 to revamp the country’s energy sector, which mainly raised the contribution of hydroelectric plants to the grid. Despite such investments in generation, transmission, and distribution facilities, the national grid’s output, currently just meeting demand, will fall short of demand by the 2022 dry season, according to studies conducted by the Ministry of Energy. This is compounded by the fact that the national grid hugely depends on hydroelectric plants clustered in the Amazonian basin. As the output of such hydroelectric plants exhibits a seasonal pattern, the launching of renewable plants such as solar—whose production climaxes in the hotter and drier months—will make the grid more robust and stable. The installation of new photovoltaic plants and wind farms, however, will not be possible without the private sector joining in—something that President Lenín Moreno has been more open to than his predecessors. The PPS, announced in 2019, will be for the construction of the Villonaco II and III wind projects, which have a combined a capacity of 110MW, and the 200-MW El Aromo photovoltaic project. Though the successful bidders will be announced early 2020, there are still issues the government and the ministry need to address, including the site ownership for the land on which El Aromo and Villonaco II and III will be built, environmental licenses, and guarantees. Judging by the fact that representatives from over 40 energy companies from Germany, China, the US, Canada, and Japan, and others, attended the launching of the tender in July 2019, the level of international interest in the projects is high. The joint launching of the three large-scale renewable projects in 2019 marks a first step in Ecuador’s transition to non-hydroelectric renewables, though there is still much work to be done. Despite the high degree of feasibility that Ecuador’s climate offers for photovoltaic, wind, and geothermal power generation, renewable energies had little or no meaningful contribution to the national grid by 2015, according to the International Energy Agency (IEA). The rectification of this shortcoming can not only help preserve Ecuador’s natural splendor, but also add to the robustness of its national energy grid and energy security.