The Technical Secretary of the Presidency, Temístocles Montás told reporters at Enerlac ’98 that the government cannot rescind the "onerous" contracts signed by the previous government with foreign generators Smith-Enron and Dominican Power. The Fernández government has complained that the contracts, signed during the administration of President Joaquín Balaguer, are unbalanced and oblige the government to pay unrealistic tariffs to the two companies no matter what actual generation costs may be. Both contracts do not expire until the year 2011. The government has tried to win a major renegotiation of the terms of the Smith-Enron case through international arbitration, but Montás says all indications are that Smith-Enron will be favored by the judgment, forcing the DR to honor the contract until its expiry. Nonetheless, the government still hopes to negotiate with both firms a contract "update" to "reflect current realities."
