The utility sector has recently been going through rises in electricity and gas serviceswhich will be one of the main topics of discussion at the Andesco Congress, which will start today.
(Read: Price of energy has grown 25% in one year).
In interview, Camilo Sánchez, president of the guild that brings together public service companies in the country, explained that there are several factors that show this behavior such as indexing, energy theft and investments. Likewise, he assured that if it were not for the good level in the reservoirs, the situation would be “critical”.
What is happening with utility prices?
We are seeing worldwide that the public services sector has had significant increases. This is not a phenomenon of Colombia, here there has been a less strong increase than what places like Europe are experiencing. Here the issue of devaluation affects us a lot, because there are many products that we must bring imported in order to keep the service running.
The same after the pandemic, the service changed and improved because we reached agreements, in which the national government has had to issue regulations and put in some subsidies and has given us incentives to continue programming improvements in public services. It should be remembered that the companies had to reconnect for 14 months people who did not pay at the expense of the companies’ resources, penalizing profits.
(See: Inflation of the poorest households already reaches 12.7%).
Camilo Sánchez, executive president of Andesco.
private file
What are the factors that are explaining the rise in bills?
It must be taken into account that the inflationary phenomenon is global and that it is added to the devaluation of the peso that affects all imports. There are areas that have much more marked increases, due to the investments made. There is another issue that is being incorporated into the rate and that is energy loss or theft. We must review how the government can help so that we can prevent this from being incorporated into the rate. But companies cannot take that risk. That is why we have to review various issues including indexers that are affecting prices. However, the energy losses must be borne by someone else because otherwise it would be very difficult to maintain the stability of the companies.
(Read: National Government does not contemplate the privatization of electricity companies).
There has been talk that prices rise despite the fact that the reservoirs are full…
Were it not for the full reservoirs we would be in a very serious situation, but fortunately we have very positive levels. Our matrix is largely water based and we need sustainability with the acceleration of the energy transition.
Should the energy loss stop coming out of the consumers?
We look for alternatives to affect users in the least way and yes or yes we have to review indexers, how the increases are charged and have a guarantee of who assumes the losses that are fundamental and today are a high cost, but that are an acquired right in the contracts. I repeat that the last thing companies want is for the value of invoices to continue to grow, but we must understand that companies are complying with contracts under the established conditions.
What alarms have been raised on the Atlantic coast?
On the Coast there have been increases also related to the large investments that have been made. Electricaribe was not doing the maintenance that should be done and the area was on the verge of a blackout. Now power outages have been reduced by 30% and it continues to improve thanks to investments. It should be remembered that the law requires that these investments be included in the rate.
What reviews are being done to indexers?
We are reviewing how the indexer can be improved, but this has to be a technical discussion, because a political decision can lead to errors in a sector that has been working technically very well. The idea is that public services do not grow above inflation because from the point of view of companies’ cash this is negative. These are not services that can be paid separately, so collection problems can be generated.
(Also: Rises in energy rates, a problem that not only affects Colombia).
What other alternatives have they proposed as a sector?
We are looking at what is going to be the indexer of the future, see what we have today and how we can improve it.
Have you met or spoken with the government about the issue?
We have to review in the medium and long term how we are going to work. The unions have met to send a letter to the minister giving her alternatives to be able to stop the growth that is taking place in prices. Very surely we will have to review how the producer and consumer price indices evolve, which are the indexers that we apply in the sector so that energy prices do not skyrocket even above inflation.
What projects are important for the sector?
We have $13 billion in renewable projects in La Guajira and we need them to start entering the matrix. We have many previous consultations that have meant that we do not have this energy effectively in the system. We also need to speed up the entry into operation of Hidroituango, which represents 17% of the matrix. By December we need at least the first turbine to be working and speed up the entry of the others so that in a future El Niño phenomenon we avoid risks.
Daniela Morales Soler
