NewsWhore
05-05-2011, 04:00 PM
The Public Electricity Corporation (CDEEE) and the government owned EdeEste power distributor company are demanding that AES sell the full 300 megawatts contracted upon the installation of the 300 megawatt natural gas facility to the Dominican electricity network.
Celso Marranzini, executive vice president of the CDEEE, says that the AES Dominicana management is holding to an administrative letter dating back to 2003 to substantiate a temporal change in the power supplied and justify their supplying only 50 megawatts. The letter states that the power plant would supply the national grid with only 50 megawatts of the 300-megawatt capacity. AES sells the difference to non-regulated users, reportedly including now the operations of Falconbridge and Barrick Gold.
Marranzini says that an administrative letter cannot amend a 70-page contract that was never approved by the power distribution company's board of directors.
"If the local administration of AES thinks that that letter, signed by EdeEste when the latter was one of their branches, modifies the contract, then we believe they used the vertical integration (generation-distribution) and imposed their dominant position to secure benefits, which would be questionable for a company that is on the stock market," said Marranzini.
In today's press, EdeEste publishes their stance with a chronological report of the events leading to the impasse today.
The CDEEE has sought for the case to be heard at the Chamber of Commerce of Santo Domingo's Alternative Resolution of Disputes Center. AES Andres presented the case for deliberation at the International Chamber of Commerce on the grounds that the arbitration should be heard at that international forum, says EdeEste.
Bottom line is that with rising natural gas prices, sourcing from the AES Andres natural gas plant is attractive. In 2002, AES Corporation signed a contract stipulating it would supply 300mw of capacity at approximately US$0.6 per kWh for 15 years. EdeEste said that this contract enabled the AES Corporation to obtain international financing to build the natural gas plant located at Caucedo.
"Unilaterally, without the approval of its partner, the Dominican government, only four months after the power plant entered into operation, the AES Group temporarily reduced the capacity to 50MW until EdeEste, in accordance with the contract, required the total contracted capacity for 300MW", says EdeEste.
EdeEste says that AES Andres has sold the difference between the 50MW and the 300MW not delivered to EdeEste at much higher prices than had been contracted with EdeEste. EdeEste has had to purchase power from other sources at around US$0.23 kWh with losses in the millions.
The company reports that in 2009, when EdeEste was bought back by the Dominican government, the new administration demanded a return to the initial contractual terms. EdeEste also says that it is not in arrears with AES Andres. The company says over the past three years it has paid approximately US$70 million for the 50MW of capacity delivered.
www.edeeste.com.do/noticia.asp?id=381 (http://www.edeeste.com.do/noticia.asp?id=381)
More... (http://www.dr1.com/index.html#7)
Celso Marranzini, executive vice president of the CDEEE, says that the AES Dominicana management is holding to an administrative letter dating back to 2003 to substantiate a temporal change in the power supplied and justify their supplying only 50 megawatts. The letter states that the power plant would supply the national grid with only 50 megawatts of the 300-megawatt capacity. AES sells the difference to non-regulated users, reportedly including now the operations of Falconbridge and Barrick Gold.
Marranzini says that an administrative letter cannot amend a 70-page contract that was never approved by the power distribution company's board of directors.
"If the local administration of AES thinks that that letter, signed by EdeEste when the latter was one of their branches, modifies the contract, then we believe they used the vertical integration (generation-distribution) and imposed their dominant position to secure benefits, which would be questionable for a company that is on the stock market," said Marranzini.
In today's press, EdeEste publishes their stance with a chronological report of the events leading to the impasse today.
The CDEEE has sought for the case to be heard at the Chamber of Commerce of Santo Domingo's Alternative Resolution of Disputes Center. AES Andres presented the case for deliberation at the International Chamber of Commerce on the grounds that the arbitration should be heard at that international forum, says EdeEste.
Bottom line is that with rising natural gas prices, sourcing from the AES Andres natural gas plant is attractive. In 2002, AES Corporation signed a contract stipulating it would supply 300mw of capacity at approximately US$0.6 per kWh for 15 years. EdeEste said that this contract enabled the AES Corporation to obtain international financing to build the natural gas plant located at Caucedo.
"Unilaterally, without the approval of its partner, the Dominican government, only four months after the power plant entered into operation, the AES Group temporarily reduced the capacity to 50MW until EdeEste, in accordance with the contract, required the total contracted capacity for 300MW", says EdeEste.
EdeEste says that AES Andres has sold the difference between the 50MW and the 300MW not delivered to EdeEste at much higher prices than had been contracted with EdeEste. EdeEste has had to purchase power from other sources at around US$0.23 kWh with losses in the millions.
The company reports that in 2009, when EdeEste was bought back by the Dominican government, the new administration demanded a return to the initial contractual terms. EdeEste also says that it is not in arrears with AES Andres. The company says over the past three years it has paid approximately US$70 million for the 50MW of capacity delivered.
www.edeeste.com.do/noticia.asp?id=381 (http://www.edeeste.com.do/noticia.asp?id=381)
More... (http://www.dr1.com/index.html#7)