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Belize Energy Sector Diagnostic PUC 52 cost of importation of electricity from Mexico BZ$24.2 million. This represents a total of BZ$131.2 million in 2002 or roughly 8% of GDP165. Additionally, the fluctuations in world prices make diesel generation a relatively expensive option. On the other hand, the costs of implementing renewable energy technologies such as solar PV remains prohibitive and the construction of a hydro facility at Chalillo while it will shift the energy balance some will not necessarily translate into cheaper electricity rates. In addition, the bagasse co-generation facility at the Belize Sugar Industries which was initially to have provided an alternative product market for sugar may be faced with its own paradigm issues given the envisioned reduction in world sugar prices resulting from the challenge within the WTO to the EU sugar regime and the fact that BSI’s current approach is to produce sugar with energy as a by-product and not the other way around. Belize currently sources 50% of its electricity from CFE in Mexico. This suggests a willingness to un-bundle the electricity supply chain in Belize and to do so by engaging in regional cross border trade if necessary. The supply of electricity involves several activities, including constructing power stations and generating electricity, expanding, operating and maintaining transmission and distribution networks, trading bulk electricity (both nationally and internationally), supplying and metering customer billing and accounting systems. In competitive markets, important services aspects can be isolated, where different suppliers intervene at different levels of the supply chain. While competition and unbundling of the supply chain appears to be a deliberate strategy for the Belize electricity industry, the policy is less clear on the extent to which the market can tolerate and thus regulation and attendant legislation will encourage competition in unbundled electricity supply. In a competitive environment, an explicit regulatory system must be established either to delimit the scope of free play of market forces or to replace them whenever it is deemed that they will not lead to satisfactory or acceptable results from a social or community stand point. It is not clear which position Belize embraces. Thus, while there continues to be meaningful attempts at competition in generation, BEL continues to dominate local generation, transmission and distribution. Additionally, while there have been some improvements, electricity prices have not decreased significantly and blackouts remain a factor. What are the long term goals of reform measures encouraging competition and service supply unbundling ....private investment, improved energy efficiency and lower costs, lower prices, quality of service, universal service, environmental improvement...? How policymakers respond to this question will dictate the policy direction. Once decided other issues that will have to be addressed include166, will competition be enhanced in all market segments (supply chain) or will it be relegated to generation? How will policymakers set rates in non-competitive segments? How will private investment be encouraged systematically? How to manage consumer protection, environmental protection, energy efficiency issues? Additionally, it is not clear whether the wider policy implications of engaging in cross-border trade in electricity, given Belize’s international trade commitments and involvement in regional initiatives, and the guidelines and constraints these place on national policy space, were (at the time the agreement with CFE was made) or are being considered.167 165 2001 GDP quoted by the CSO at 1.6 billion. 2002 figures not available at the time of this report. 166 The list is by no means exhaustive and meant only to inspire discussion and thought 167 This is discussed in some detail below.PDF Image | Energy for Sustainable Development Toward a National Energy Strategy for Belize Energy Sector Diagnostic
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