Stabilising Electricity Sector Investment

Author:Mrs Selva Quintero
Profession:Galindo Arias & Lopez

In the 1990s, the National Government decided to carry out a comprehensive reform of the electricity sector. To this end, it enacted the Law of January 26th, 1996 (Law 26), which created the ten-called Regulator of Public Services, an entity in charge, as its name implies, of regulating the telecommunications, potable water, and electricity sectors.

Likewise, one year later, the Government promulgated Law 6 of February 3rd, 1997, which contained the Regulatory and Institutional Framework for the Provision of Public Electricity Services (Law 6). The Law established the regime under which the activities of generation, transmission, distribution, and commercialization of electric energy intended for the provision of a public electricity service should be governed, as well as the regulatory and coordinating activities involved in planning the expansion and integrated operation of the nationally interconnected system, and its economic regulation and monitoring. In this context, the state started to play the role of governing body.

One of the most relevant elements in the process of transformation of the electricity sector is competition, and so investment must be promoted and encouraged. Investment, the...

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