The head of Unión Fenosa distributors Edenorte and Edesur, Luis Amaro Díaz admitted to Hoy newspaper journalists that Dominicans pay one of the highest electricity rates in the world today. When asked, Amaro Díaz said he could not think of another country where power was more expensive than in the DR. But, he is optimistic, this situation will be reverted in 2003. He explained Edenorte and Edesur, the electricity distributors, are purchasing power at US$0.11 the kilowatt/hour from generators. He said there are generators that sell for US$0.14. This situation is an inheritance from the days when only the government-owned Dominican Electricity Corporation could legally generate energy. The Balaguer administration allowed the installation of private companies to meet the growing demand, but the illegality created a high-risk situation that left the doors open for corruption in signing of high-priced contracts, which has worked against consumer interests. Unión Fenosa is not a newcomer to the DR power scene. It was hired during a Balaguer administration to consult with the CDE management. Amaro Díaz insists prices will eventually drop. He said that generation prices are already dropping. Despite the privatization scheme originally ruled that distributors would not generate and generators would not distribute, as matters have evolved the distributors are installing power generators from which they will be purchasing power for distribution. Amaro Díaz explained that their new Palamara plant is selling power for US$06.40. He said that in Spain, generators sell power for US$0.03 to US$0.05 cents per kilowatt/hour. He is convinced in three years time the DR will not have power problems, and power supply will be reliable and will reflect world market prices. He explained power in the DR is so expensive because 87% of plants run on fuel oil, only 13% is generated by hydroelectric plants. Amaro Díaz forecast the situation would be reversed by 2003. By 2003, that 87% of plants using the more expensive fuel oil should have dropped to 25%. He said Unión Fenosa has plans to install windmills to make electricity. Also underway in the Dominican power sector is the installation of charcoal, natural gas and other alternative power plants. Amaro Díaz said the company that distributes 70% of the energy in the DR is making investments for US$550 million in the DR.
