Regional Power Integration : Structural and Regulatory Challenges
The Central America Regional Electricity Market (MER) trades electricity and transmission capacity among six Central American countries: Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. The market differs from other electricity m...
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| Format: | Energy Study |
| Language: | English |
| Published: |
World Bank
2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000333037_20110721002752 http://hdl.handle.net/10986/2766 |
| Summary: | The Central America Regional Electricity
Market (MER) trades electricity and transmission capacity
among six Central American countries: Costa Rica, El
Salvador, Guatemala, Honduras, Nicaragua and Panama. The
market differs from other electricity markets worldwide
because it has its own regulatory body and system operator.
Economic integration of the Central American countries has
followed a natural evolution. The continuous increase in the
demand for goods and services has been accompanied by
political and institutional arrangements leading to the
materialization of commercial and trade agreements aimed at
benefiting the nationals of all the integrated nations at
the lowest possible cost. This is particularly true in the
electricity sector, which provides a key development service
for the achievement of sustainable growth. In fact,
electricity integration through cross-border power trade has
been discussed by the Central American countries since the
late 1970s. This report analyzes the progress of the Central
American integrated electricity market, including the
institutional, legal, regulatory and contractual framework
of the MER and of each of the six national markets. It then
identifies the main barriers that will have to be addressed
in order to ensure a successful evolution to full operation
of the Central American Electrical Interconnection System
(SIEPAC) interconnection system and achieve true market integration. |
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