NARUC Implements Nicaragua-Texas Partnership

In late February, NARUC implemented its first partnership activity between the Nicaraguan Energy Institute (INE) and the Public Utility Commission of Texas.

The week-long activity set the stage for a continued partnership designed as a vehicle for the exchange of experience and information between U.S. and Nicaraguan public energy commissions with the goal of improving market-based regulatory practices and institutions. In addition to the involvement of Commissioner Paul Hudson and senior staff from Texas, Angela Minkin, Administrative Law Judge with the California Public Utility Commission, provided perspectives on regulatory issues from the California experience. NARUC carries out these international activities through cooperation with and funding provided by the U.S. Agency for International Development Mission in Managua.

From the outset, the partners established a collegial, professional relationship and showed a substantial degree of openness in sharing their own perspectives on the basic structure and challenges each group of regulators encounters. Discussions touched on themes such as power-purchase agreements, incentive mechanisms for renewable energy, tariff methodology, monitoring quality of service, commercial and technical losses, and customer interface.

INE members commented a number of times throughout the week that Texas appeared to be an ideal match as a partner since both parties share many similar challenges. The INE also valued California's experience in renewable energy as Nicaragua has substantial resources for geothermal and wind power generation. The week provided a great first step in establishing professional linkages between the agencies involved.

The energy sector in Nicaragua is currently facing significant challenges with regard to maintaining a consistent supply to meet the growing demand for electricity. Thus, it was not surprising to see strong interest from the national media, as the initial meetings and the MOU signing ceremony generated newspaper and television coverage. The positive coverage recognized that the technical expertise shared will assist in determining appropriate
methods for INE to address the current regulatory challenges. The presence of H.E. Paul Trivelli, U.S. Ambassador to Nicaragua, and Alex Dickie, Director of the USAID Mission to Nicaragua, at the MOU signing highlighted the importance of this initial step in the partnership

In addition to the meetings, INE was a gracious host and kindly arranged site visits to Mombacho and Masaya, both volcanoes near Managua. The camaraderie among all involved created a positive environment for further formal and informal discussions regarding Nicaragua's energy sector.

In order to maintain the current momentum, NARUC, INE, and the Texas PUC plan to hold the second exchange activity in the coming months where INE will visit Austin to further the dialogue and discussions on renewable energy, tariff methodologies, and diversifying the electricity generation matrix.