Bolivian neighborhoods in most cities have been facing blackouts in the last week or so. Lack of investment in the expansion of current electricity supply; and problems on existing generators due to lack of appropriate maintenance are the sources of the problem.
In Santa Cruz there have been proposals to shift the hour starting this coming Spring (around Sep 21st), in the hope of saving some electricity, although some experts say that will not solve the problem. Households need primarily electricity to keep their food away from spoiling. Industries need energy despite the time of the day.
El Dia reports today that sugar mills are willing to provide electricity to the national grid (SIN), by burning sugarcane leftovers from their production: bagasse. They only request that there should be long-term contracts with the SIN to secure their investment.
Guabira sugar mill already delivers 20 MW to the SIN, a ten million dollar investment could generate additional 15 MW supply.
Unagro sugar mill plans to deliver 4.5 MW between this Sep through Nov 2011, without additional investment. They can produce 17 MW and could expand to 20 MW provided the government gives the green light and financing. Unagro said the price structure as of now is risky in comparison to other suppliers (thermoelectric and/or hydroelectric plants).
Keynes would be happy, the private sector can and is willing to intervene to help solve the supply of electricity. Only if the government fulfills their expected role… and Friedman would nod in agreement.