Monday, November 04, 2013

 

Renewable Energy - Nicaragua

Nicaragua advances its goal of changing the energy used and increasingly moving towards the use of clean energy.
According to the Ministry of Energy and Mines, MEM,  52% of the energy consumed in Nicaragua comes from clean sources (aeolic, geothermal and hidroelectric) and 48% of petroleum based products.
Nicaragua Regional Clean Energy Index in Latin America, known as "Climatescope 2013", in which its only surpassed by Brazil and Chile and is considered an attractive country to invest in clean energy.
Nicaragua is a country with many natural resources, such as geothermal resources for its long chain of volcanoes and seismic activity, excellent exposure to wind and sun, and a large number of point sources of water emphasized the fact the World Bank in an article entitled "A paradise of renewable energy is gaining ground in Central America."
With all these natural resources, Nicaragua has a potential of 5,800 megawatts.
The country would only need to use 10% of their potential in renewable energy to meet its energy demand, amounting to 500 megawatts, however, to date only 5% is in use.
Nicaragua renewable energy sources  18% comes from geothermal, wind another 18%, 8% and 8% hydro biomass. Solar energy is the new kid on the block and thus its contribution to energy generation  has  being measured.
Objectives
The government's goal is that 90% of the energy consumed in the country comes from renewable sources  by the year 2020.
TumarĂ­n hydroelectric project will cost 1,100 million dollars, and would produce 253 megawatts in northern Nicaragua, but is six years away to go live.
The success of clean energy in Nicaragua will depend on it ability to provide better prices than oil, so the country is able to save foreign exchange and maintain stable energy costs.
Another way to take advantage of clean generated energy production  is sell / export through the regional electrical interconnection system for Central America, Mexico and Panama, known as SIAPAC.


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Tuesday, August 20, 2013

 

SME Exports

Last year an acquaintance of mine  the principal of an export oriented SME  was recognized  last year by an export association as one of the best small exporter in Nicaragua.    The principal shareholder of the SME is an american who prior working in Nicaragua worked in the highly competitive market of software design and electronic payment industry in the West coast of the US.   People who know this person know him as being  professional , organized, precise, and accustomed to doing things correctly.  

What happened to this SME (exporter) is what happens to many small exporters who export commodity products to the US and/or other export markets.  Here is how it works.   The exporters sell their goods on open account basis to a broker/distributor in the importing country who takes possession of commodities upon arrival, inspects   and decides to accept or reject the product.   In our case the importer argued that the product shipped was too small, did not meet specifications stated in the sales contract.   Therefore since it did not meet specifications the exporter had three choices a) sell product at a discount b) take product back or c) destroy it at port of entry.   Commodity Brokers in any country enjoy  the bargaining power of customers (buyers) that is they have control and may force an exporter to accept their terms and conditions under duress.   In our case the exporter took his produce back, sold it  to another buyer  but at a deep discount taking a major financial loss, a loss that put his small company in jeopardy of going bankrupt.   The only recourse available to the exporter was to file a complaint with USDA under the Perishable Agricultural Commodities Act (PACA).  A year later the exporter is still fighting in the US to recover his losses but in the mean time to survive he has been selling assets to pay trade bills and financing expenses.   Exporter hopes to be back in business when and if he is compensated.   


     

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