If the CDEEE could just renegotiate the Madrid Accords, the EDEs could save an estimated US$689 million to a US$758 million each year, but it has been impossible to convince the IPPs (Independent Power Providers) to renounce this juicy profit. This information was reported in the Listin Diario after looking at a technical paper prepared by the Generation Management Committee. The report sees the CDEEE purchasing energy at US$0.136 per kWh, according to the average price for 2005. It sells this energy at US$0.097239 on the spot market for a loss of US$0.0388 cents per kWh or US$3.0 million per month. According to reporter Jairon Severino, the Edes have not met the 80% collection rate that is required to eliminate the government subsidies that will reach US$600 million this year. This money goes to the generators to cover the over-priced electricity they are providing.
The Madrid Accord allows the IPPs to sell energy that costs less than US$0.09 per kWh to produce at US$0.136 per kWh. Other newspapers have reported that several IPPS have stopped producing energy and purchase energy on the spot market at lower prices and then sell it to the distributors at the Madrid Accord prices.