Venezuela amends law to open electricity sector to private sector

China News Service, Beijing, November 11th. Caracas News: On November 10th, the Venezuelan National Congress unanimously approved partial modifications to the "National Electricity System and Service Organization Law" to allow private companies to participate in power generation and other activities.

According to reports from Venezuela's Últimas Noticias, Banca y Negocios, Reuters, EFE and other media, this move was promoted by Venezuela's acting president Delcy Rodriguez and is intended to alleviate the country's power crisis that has lasted for many years. The National Congress of the Communist Party of China approved the revision of the law unanimously.

The revised law stipulates that power generation can be carried out by state operators, hybrid enterprises and authorized private enterprises; private individuals can carry out self-generation and supply power to large users such as industries and shopping malls at regulated electricity prices. The maximum concession period for private power generation is 25 years, which is granted by the Ministry of Electricity and Energy and can be revoked. After the expiration of the concession period, the assets must be transferred to the Venezuelan National Electric Power Company (Corpoelec) or a designated agency.

Venezuelan National Congress Chairman Jorge Rodriguez called this a "profound reform", which was initiated by Delcy Rodriguez and adopted after extensive consultation with potential service providers, Venezuelan Ministry of Electricity staff and users. He emphasized that the private sector mainly serves large consumers to increase the supply of the national power system; electricity prices will be linked to the currency with the highest value, while subsidies will be implemented for low-income groups.

Jorge Rodriguez also said that the law in no way promotes privatization, but only opens up private participation in power generation and self-generation and commercial transactions. The state is still responsible for ensuring the supply of electricity, especially for vulnerable groups.

According to Reuters, this reform is the latest step in Delcy Rodriguez's push to open up Venezuela's oil, natural gas, mining and other fields. Currently, Venezuela’s power generation facilities are under-operated, accounting for only 40% of the total power generation capacity. (over)