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Renewables: An Inside Look at Costa Rica's Commitment to Renewable and Sustainable Energy

by John Ferrare, Enerdynamics CEO

With more than 90% of its electricity generated from renewable energy sources and goals to reach 95% by 2014, Costa Rica is certainly one of the greenest countries on the planet. It also is on track to become the world’s first carbon-free economy.

Having recently returned from a 12-day tour sponsored by Global Renewable Energy Education Network (GREEN) and showcasing renewable and sustainable energy in Costa Rica, I am impressed, amazed, and encouraged by what I learned and saw. With this experience fresh in my mind, I thought I’d take this opportunity to share some of the educational highlights with Energy Insider readers.

Costa Rica: A renewables paradise
Mother Nature has greatly influenced Costa Rica’s commitment to renewable energy. The country is blessed byinside a wind turbine copious amounts of rainfall – most of the country receives more than 100 inches of rain per year. Thus, it’s no surprise that over 80% of Costa Rica’s electricity is generated by hydro facilities. In fact, with resources like this, it would be a wonder if Costa Rica didn’t take advantage of them. While hydro certainly dominates the country’s renewable portfolio, it also boasts considerable geothermal power as well as growing wind assets, solar, and biomass facilities. (Such diversity in renewable resources within a relatively small region is why GREEN selected Costa Rica as its primary geographic focus.)

ICE's role in renewables

The Instituto Costarricense de Electricidad or ICE (pronounced ee-say) of Costa Rica is the state-owned electric monopoly that provides power to over 98% of Costa Rican homes. While many of the facilities that produce this power are ICE-owned, a small percentage is owned privately under rather non-traditional contracts. In many cases, these facilities are privately owned for a period of 15 years and are then handed over lock, stock, and barrel to ICE, which then owns and operates them. After a decade-long break from allowing such projects, ICE recently announced a plan to again accept bids for privately owned renewable projects (100 MW of hydro and 40 MW of wind). The plan intentionally aligns with Costa Rica’s goal of becoming a carbon-free economy.

 

ICE also implemented a net metering program in 2010 whose goals were, again, to increase renewable energy production and thus the country’s energy independence. The program is limited to 5 MW of total capacity (1 MW for residential and the remaining 4 MW for commercial/industrial). The pilot program also allows ICE to study the effects of distributed generation on its grid as well as to promote new renewable technologies. While surplus energy is not sold to ICE, those generating surpluses are allowed to carry them as kWh credits into the next year’s billing cycle.

 

A countrywide commitment

Costa Ricans are very proud of their renewable and sustainable efforts, which come at a premium price. Average residential rates are over 30 cents per kWh, and this may soon increase. Yet oddly, citizens are not likely to complain. The dedication to a renewable/sustainable society seems to be a shared goal, and the monetary cost of this commitment is widely accepted as are the variables that can affect it. For example, with such a large portion of electricity needs met by hydroelectric power, the country is hugely dependent upon rain. And in dryer years, as 2012 has so far been, ICE is concerned that it cannot generate enough supply to match demand. Less water means less hydro power is available. This means costs increase (since power must be purchased from other sources) and so does the amount of power generated from fossil fuels.

 

The GREEN tour afforded unprecedented access to renewable facilities in Costa Rica. My group and I enjoyed guided tours of hydro facilities, a biomass plant/sugar cane refinery, a geothermal plant, and a wind farm. Not only were we inches from the equipment housed in these facilities (imagine access like this in the U.S.!), but also heard first-hand accounts of how such equipment is run and ICE’s unique perspectives on electricity production.

 

While GREEN is currently focused on providing this experience to college-level audiences, Enerdynamics and GREEN are discussing a partnership where this unique opportunity could be available to business professionals. For more information, please contact me at jferrare@enerdynamics.com.

Photos courtesy of John Ferrare; first photo shows the inside of a wind turbine; second photo shows a hydro turbine

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