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El Salvador

El Salvador

Renewables push will make way for wind

EL SALVADOR: El Salvador, which has little installed wind power, is undertaking an aggressive push on renewable energy which will see a new regulatory framework by July, a major wind power study, and plans for its first two major wind power projects.

Details of the framework have not yet been published, but it would be within the powers granted by existing laws. The country has a 2007 law to promote renewable energy. Its main measure was creating a fund known as the Fofer, which used both state and donor funds. To qualify, a project must have a power-purchase contract of at least ten years.

The fund can be used as a guarantor for projects to get substantially bigger bank loans by guaranteeing a fixed return on investment for a project, by effectively fixing power prices at $70/MWh as of this year. However, no wind projects have yet qualified for Fofer funds.

The government estimates its electricity needs will be close to 15GWh in 2020, compared with 6.5GWh in 2007, the date of its last energy plan. Its single largest electricity source is gas-fired power stations, which make up 48% of the total.

El Salvador has no natural gas of its own, so is exposed to the vagaries of international markets. The next largest source, at 39%, is hydroelectric power, which leaves it at risk of power shortages when droughts strike. This was last a problem in 2009, when a drought hit Mexico and Central America.

The government has stated diversifying its power-production mix as a policy target each year since 2005. It began its first studies covering wind and solar energy that year and has also been discussing biomass and mini-hydro power.

The wind study is being led by the National Energy Council and sponsored by the Japan International Cooperation Agency. Officials from both bodies met in April. The study is expected to begin in July and last a year. Its results will update and add substantial detail to an earlier joint study by the United Nations Environment Program and the US Department of Energy's National Renewable Energy Laboratory, which had already identified steady wind speeds of 8.0-8.8 metres per second in Ahuachapan, Santa Ana and Chalatenango, all in the west. The report lacked sufficient details to act as a base for decision-making, according to Mario Rodriguez, director of the National Energy Council's renewable-energy division.

Meanwhile, Rio Lempa Hydroelectric Dam Executive Committee (CEL) is expecting the results of a feasibility study for two wind power projects in May. The study was paid for by a EUR300,000 Spanish government grant. CEL, El Salvador's first major power distributor, issued a competitive tender on the study in 2009 awarding the work to Iberinsa, a subsidiary of Spanish energy firm Acciona.

The study focuses on Metapan, in Santa Ana department on the Guatemala border and San Isidro, in Pacific coast department Sonsonate which neighbours Santa Ana to the south.

The projects are sited in areas where corridors running between the mountains channel the wind.

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