Fitch: coal-fired plants help economy; Environmentalists: phooey
Santo Domingo.- Fitch Ratings in its latest CorporateFinance Report said the Punta Catalina coal-fired power plants contribute tothe financial sustainability of Dominican Republic’s energy sector byintroducing coal as a key element in generation.
And despite that Fitch analysts say coal prices has beenmore stable than liquid fuels, increasing its stake in the parent generation"could reduce the volatility of costs in the SENI (National InterconnectedEnergy System)," environmental groups affirm that the installation ofcoal-fired plants violates the law.
The rating company says switching to coal “could helpsupport a marginal cost of relatively low energy in the medium term, supportinglower purchasing costs for distribution companies, resulting in lower publicsector transfers to energy".
Punta Catalina’s entry into the market also helps to,according to Fitch Ratings, maintain marginal energy costs in the range from US$6cents per kilowatt hour (kWh) to US$8 cents /kWh in 2018 and 2019.
Environmentalists rebuff coal push
In the emailed statement “The government tries to carbonizethe country’s electricity-generation pact” the National Committee to CombatClimate Change, CNLCC, calls the push for coal-fired plants “anopen violationof National Development Strategy Law 1-12, which calls to “decarbonize” theeconomy and the generation of electricity.
“A recent government document allegedly reflects theconsensus of the talks leading to the Electric Pact and proposes that to sign thisagreement, base on the approval of the Punta Catalina coal plants, that willcover, along with existing coal plants, more than half of the country electricitydemand,” the CNLCC said.
It regrets that the government refuses to take advantage theexpiration of the Madrid Agreement, “freeing the country from the legal bondsfor the Electric Pact to set a target for renewable sources to cover 85% of theelectricity demand by 2030.”
“The high percentage of electricity to be generated fromcoal when Punta Catalina starts, makes a significant incorporation of renewableenergy sources in Dominican Republic’s electrical system over the next 20 yearsimpossible,” the CNLCC said, adding that coal plants are slow to turn on andoff, “making it impossible to harmonize them with renewable energies which arevariable in nature.”