The Agency for Regulation and Control of Energy and Non-Renewable Natural Resources issued the regulations titled: “Electricity Generation from Municipal Non-Hazardous Solid Waste” (hereinafter the “Regulations”).
Scope:
The general regime for obtaining the enabling document (título habilitante) is set forth in the Organic Law on Public Electricity Service and its General Regulations, while the Regulations describe the specific requirements and procedures that apply to the granting of an enabling document for generating electricity from municipal non-hazardous solid waste or residues.
Requirements and Procedure:
- Beforehand, any interested parties must make the necessary arrangements and coordination with the Decentralized Autonomous Government (GAD) to establish, among other aspects, the energy production method, maximum power capacity, and optimal location of the project. The applicant must obtain a letter of commitment signed with the GAD whose service area will host the generator, and must include at least the term during which the GAD will transfer the use of the resource to the applicant, a general description of the comprehensive waste management actions agreed with the GAD, and the applicant’s responsibilities to the GAD in relation to the environmental aspects associated with the management of the waste.
- Any interested parties must request from the Ministry of Energy and Mines the Qualification Certificate pursuant to the provisions of the General Regulations to the Organic Law on Public Electricity Service. The issuance of this certificate will grant the applicant exclusivity for the development of a project that takes advantage of this resource for 18 months, with the aim of obtaining, during such term, the final studies and authorizations for the implementation of the project.
- Once all the required authorizations have been obtained, the enabling document (concession contract) will be signed.
Terms of Sale and Preferential Price:
The generator will sign regulated contracts for the sale of energy with authorized distributors in Ecuador.
For 15 years, the generator will have a preferential price of 74.7 USD/MWh.
Projects with a capacity greater than or equal to 1MW will enjoy preferential dispatch.
Connection:
The Regulations describe the process of obtaining the preliminary and final connection feasibility certificates, up to the signing of the connection contract. Generators will assume the costs of the necessary civil works and infrastructure up to the project’s connection point; however, the Ministry of Energy and Mines, at the request of the generator, will establish the necessary easements for the construction and operation of this power infrastructure.
Should you require any additional information regarding this matter, please contact Sebastián Cortez Merlo (scortez@pbplaw.com); Carlos Izquierdo (cizquierdo@pbplaw.com) or María Elena Sanmartín (msanmartin@pbplaw.com)
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