According to Bredyg Disla of the List?n Diario, the electrical generation and distribution companies are planning to meet with government officials to discuss the concession of a special exchange rate for their industry. George Reinoso, the Superintendent of Power, has confirmed that the soaring exchange rate has created a financial crisis for the energy sector. Just last week the system collapsed, with 14 generating plants shutting down, thereby creating a 400-megawatt deficit in distribution. Disla reports that Antonio Pantoja, the representative of Ede Norte and Ede Sur, said that the devaluation of the Dominican peso has duplicated their fuel purchasing costs. He explained that in 2002 they were purchasing fuel with the dollar at a rate of RD$17, whereas today?s costs must be calculated at RD$32 per dollar.
In a similar article in the economic section of Hoy, Mario M?ndez features the opinion of economist Eduardo Tejera, who warns that within the next two weeks to one month there will be a financial collapse of the energy sector, with the resulting blackouts causing a state of national emergency, unless the cash-flow problems facing the industry can be solved. To confront this problem, Tejera recommends a revision of the price structure that was set up in the Madrid Accord signed by Mej?a government officials, which is, according to Tejera, a far cry from today?s reality.
A deficient system of payments from years back, combined with the higher prices of oil and the devaluation of the Dominican peso, has worked against the sector. The 100% devaluation of the peso has produced a 40% increase in the cost of electricity, according to Tejera, and the resulting deficit in cash flow caused by non-collectable debts will bring about a crisis in the short term.