Blackouts reduced as hydro plants power up; Abad likely to regain VP duties; Diesel flows to Cuenca again; Money exit tax lowered for some imports

Blackout periods in most of the country have been reduced since Thursday due to increased hydroelectric generation. In Quito and Cuenca, one of two daily blackouts have been eliminated or have had their hours reduced. The Energy Ministry credits the higher production to recent rain.

The Coca Codo Sinclair generated more than 1,000 megawatts of power Friday and Saturday, up from 400 megawatts earlier last week, the Energy Ministry reported. In addition, three smaller hydro plants in Cotopaxi and Tungurahua Provinces increased generation.

In the south, the three generation plants in the Paute-Mazar complex remained mostly idle, although the ministry says two of the plants have been activated “on a minimal level.”

The ministry denied claims by two energy experts that the two Paute-Mazar plants operated at 40% capacity early last week due to low production at Coca Codo Sinclair. The experts claimed the higher capacity was needed to accommodate the government’s reduced blackout hour schedule.

They also claim that increased generation at Paute-Mazar has not allowed the reservoir level to rise, despite increased rainfall.

Abad likely to regain VP duties
Vice President Verónica Abad is likely to win a challenge to her 150-day suspension by President Daniel Noboa, legal experts say.

At a Friday hearing, Quito Judge Nubia Vera said she had “difficulty comprehending” the Labor Ministry’s justification for Abad’s suspension. Testimony by ministry attorneys failed to meet the criteria for removing the vice president from her constitutional duties, she said. Vera also questioned the authority of a ministry under the control of the president to rule on an issue with “constitutional ramifications.”

Vera suspended the hearing until December 9, when she will make a ruling.

Also on Friday, the Constitutional Court admitted a request from the National Assembly to interpret the legality of Abad’s suspension. The court asked for additional information from Assembly members and said it would consider the issue once that is received.

Quito constitutional law professor Patricio Goya said the two court actions are “almost certain” to reinstate Abad’s vice-presidential duties. “The conflict of the president’s personal wishes and the authority of the constitution is obvious. I can’t imagine how the Labor Ministry’s actions will stand.”

Diesel flows to Cuenca again
Repairs have been completed to the Guayaquil-to-Cuenca pipeline and diesel fuel is once again flowing to Cuenca’s fuel terminal in Challuabamba. The pipeline was out-of-service for seven days, the result of ruptures in the line. During the outage, local fuel distributors were forced to send tanker trucks to Guayaquil and Troncal to collect fuel.

Officials at PetroEcuador said the pipeline ruptures in rural areas were the result of thieves tapping into the line. They added that additional guards and police have been posted near vulnerable locations.

Fuel Distributors in Cuenca report a 130% increase in diesel demand to fuel large generators during electrical blackouts.

Money exit tax lowered for some imports
The government announced Friday that the 5% exit tax on money sent out of the country (ISD) will be reduced on sales of imported raw materials used to manufacture products. The tax will be eliminated entirely from January to April and will rise to 2.5% after April.

According to the presidential press office, the reduction is intended to benefit Ecuador’s manufacturing sector. “The tax has increased the production and sale costs of goods sold in the local market and those exported,” a press statement said. “The elimination and reduction of the ISD will increase competitiveness in the market.”