Guatemala’s Electric Power System consists of three components:  electric power generation-supply, transportation, and power demand- Distribution.

The Power Generation System is made up by: hydroelectric power stations, steam turbines, gas turbines, internal combustion engines and geothermal power stations.  Power generation is not subject to authorization from the Ministry of Mining and Energy (MEM), other than those utilizing assets of public domain.

The Transportation System is made up by the Main system and the Secondary System, the first of which is shared by the Generators and interconnections with other countries, basically operating at three voltage levels: 230, 138 and 69 kv.  The Secondary System is the means by which a generator interconnects with the main network.

The Distribution System is made up by the distribution infrastructure –lines, substations and distribution networks—operating at voltages below 34.5 kv.  The leading distribution companies, coordinated by the Wholesale Market Association, are:

• Empresa Eléctrica de Guatemala. Serving the country’s central area.
• Distribuidora de Electricidad de Occidente. Servicing the western provinces.
• Distribuidora de Electricidad de Oriente. Serving the Eastern provinces.
• Municipal electric power companies.

The regulating framework of the Guatemalan electric power sector is based on a competitive market model at the power generation and marketing levels in which free access and a price system that reflects free supply and demand balances are favored, since effective conditions of competition can occur in these segments.  In those sectors in which economies of scale give way to the existence of natural monopolies, prices are set by the regulating entity, based on efficient economic costs.

Power generation is developed in a free and competitive atmosphere comprised by a market of opportunity based on a short term marginal cost dispatch, and by a contract market in which agents and important users freely agree on the conditions of their contracts, regarding the term, amounts and price.  Transmission and distribution are regulated activities.  The legal framework, on which the electric power subsector is governed, is based on the following: 

• The Political Constitution of the Republic
• The Electric Power Law, Decree No. 93-96
• The Electric Power Law Regulations, Government Agreement No. 256-97, and its modifications.
• Wholesale Market Administrator Regulations, Government Agreement No. 299-98 and its modifications.
• Commercial and Operational Coordination Regulations pertaining to the Wholesale Market Administrator.

The Electric Power Law is the basic law in matters of electricity and is sustained through the principles detailed below:

• The generation of electric power is free and does not require prior authorization or precondition from the State, other than those acknowledged by the Political Constitution of the Republic of Guatemala and the national laws.  Nonetheless, in order to use State assets for such purposes, the authorization of the Department will be required when the plant power exceeds 5MW.
• Electric power transportation is free, when the use of public domain assets is not required.
• Electric power transportation implying the use of public domain assets and the final electric power distribution service shall be subject to authorization.
• Electric power service-lending prices are free, except for transportation and distribution services, which are subject to authorization.  The transfer of power among generators, marketers, importers and exporters resulting from Wholesale Market operations shall be subject to regulation as set out by law.

ELECTRICAL MARKET

The Electric Power Market is made up by the Regulated Market and the Wholesale Market.  The Regulated Market consists of the following:

• With regard to the demand:  All those users with a power demand of less than 100 Kw.
• With regard to the supply: Authorized distributers inside their area of coverage.

The Wholesale Market has the following characteristics:

• Generators with a power of over 5 MW
• Distributers with a minimum of 15,000 users
• Transporters with a minimum transportation capacity of 10MW.
• Marketers buying or selling blocks of power relating to a Steady Supply of at least 2MW.
• Large users with a maximum power demand of over 100kw.

Wholesale Market buying and selling operations are carried out in accordance with the Commercial Coordination Regulations through:

• The Opportunity Market or Spot Market.
• The Forward Market.  Large users agree on the terms, amounts and prices of power.
• A market of transactions for daily and monthly Deviation of Power.

 ELECTRICITY SYSTEM INDICATORS 

2008-2018 TRANSPORTATION SYSTEM EXPANSION PLAN 

The initial operation of various new power generation projects is being contemplated in order to satisfy the demand growth, making it necessary to build financially feasible reinforcements in the electric power transmission network.

The Transportation System Expansion Plan develops the transmission network with a ringed or screened topology, with the purpose of such fulfilling the N-1 operative security criteria, which means that if an element of the network is lost, it can continue to operate normally.  Currently, the SNI uses a radial topology that I vulnerable in the event that one of its elements is lost.

2008-2022 INDICATIVE POWER GENERATION SYSTEM EXPANSION PLAN

The Indicative power generation system expansion plan calculates the optimum expansion of the system taking restrictions or conditions such as investment costs, operational costs, fuel, and the minimum and maximum initial operations of the different electric power stations into consideration.

The following table shows the average of the three (low, medium and high) demand scenarios, capable of being installed during the 2008-2022 period, and the average investment cost in current values concerning the year 2008.

The marginal cost of the average demand of the three demand scenarios tends to decrease and stabilize in the long term.  Only one variation exists from the dry to the rainy season, as shown below:

• Dry season: US$ 95 / MWh
• Rainy season: US$ 85 / MWh

The power generation projects with sufficient technical and commercial information were taken into account when preparing the Plan; this does not limit or reject the construction of other projects that could be available. 

Plant investment costs are calculated at current values based on the studies published by international organizations for each technology used.  The main source of information is the International Atomic Energy Agency, or IAEA.

Potential Thermal Plants, non-renewable resources

Potential Candidates, Renewable Resources