No menu items!

COSTA RICA'S LEADING ENGLISH LANGUAGE NEWSPAPER

HomeTopicsExpat LivingSteep Electricity Hike Hits Costa Rica

Steep Electricity Hike Hits Costa Rica

Electricity prices have spiked over 8% this month in Costa Rica, marking the steepest single monthly increase since February 2023, according to new data. The price hike was anticipated by the state-owned Costa Rican Electricity Institute (ICE) in light of amplified production costs stemming from greater reliance on thermal power plants amid worsening drought conditions.

Prolonged dry weather associated with the El Niño climate cycle has severely reduced water levels at the country’s hydroelectric dams, lowering output. ICE indicated the resultant decline in hydroelectric generation has necessitated the activation of supplementary thermal generating facilities powered by expensive imported bunker fuel.

“The reduced rainfall from El Niño means our dams cannot produce enough hydroelectricity to meet demand. We must therefore ramp up electricity from our bunker-fueled thermal plants despite the great cost,” said Irene Cañas, Executive President of ICE’s Electricity Sector.

Statistics from the National Institute of Statistics and Census show January’s 8.11% price surge marked the most pronounced upward pressure on household budgets as well as business expenses last month across all goods and services. Over 2023, electricity rates rose sporadically between 0.3% to 15.3% across Costa Rica’s various distribution firms.

The latest increase accounts not only for ICE’s additional expenditures in 2024 due to operating costly thermal plants but also deferred expenses from 2023 linked to managing backup generators through past droughts. ICE projected spending 94.7 billion colones on fuel over 2024.

Cañas indicated this fuel expenditure will be concentrated heavily in March, April and May when rainfall shortage is forecast to peak. ICE plans to disburse over 70 billion colones on fuel for drought-necessitated thermal power in these three months alone, representing nearly 75% of expected annual fuel costs.

While electricity prices escalate, inflation persists in negative territory across Costa Rica’s broader economy and continues trending downwards as per the national consumer price index. Economists project inflation could fall over 2 percentage points year-over-year if electricity costs remain stable.

Trending Now

Guatemala Backlash Grows after Escape of Imprisoned Gang Members

The escape of 20 “high-risk” gang members from a prison has sparked a political crisis in Guatemala, with criticism of President Bernardo Arévalo and...

JetBlue Flash Sale: Fort Lauderdale to Liberia Flights Ends Today

Those looking for a deal on airfare and eyeing a trip between Florida and Costa Rica now have a chance to get one with...

Costa Rica President Narrows Legal Abortion to Life-Saving Cases

President Rodrigo Chaves has repealed Costa Rica's therapeutic abortion protocol, a move that fulfills a long-standing promise and tightens rules around the procedure. The...

Costa Rica OIJ Arrests Human Trafficking Ring Exploiting Minors

The Judicial Investigation Agency (OIJ) dismantled a gang dedicated to human trafficking for the sexual exploitation of minors after carrying out 19 simultaneous raids...

Costa Rica Arrests Suspects Wanted by U.S. for Cocaine Smuggling

Authorities in Costa Rica arrested four men from the southern part of the country, all wanted by the United States for extradition on charges...

Costa Rica’s Liberia Airport Fixes Runway Issues Overnight

Contractors began repairs on the runway at Daniel Oduber Quirós International Airport this week, focusing on sections that did not meet required standards after...
spot_img
Costa Rica Coffee Maker Chorreador
Costa Rica Coffee Maker Chorreador
Costa Rica Travel Insurance
Costa Rica Rocking Chait
Costa Rica Travel

Latest News from Costa Rica