These are the 10 key points of the Noboa energy law approved by the Assembly

The Law proposes to condone or forgive 100% of the interest for customers who have not paid their electricity bills, which includes electric service and public lighting.

It is a measure aimed at natural persons, so industrialists will not have access to this benefit.

To access forgiveness, clients must pay the entire principal of their debts by June 30, 2024.

In addition, it was added that those who have debts for electricity bills generated during the state of emergency due to the 2016 earthquake to end customers in the provinces of Manabí and Esmeraldas are part of the benefit. Industrialists in both provinces will not benefit from this last measure either.

The Law does not change article 25 of the Electricity Sector Law, which establishes the possibility that the State can delegate to mixed companies where the state has a majority participation and, exceptionally, to private capital, foreign state and economic companies. popular and supportive, participation in the electrical sector.

The change it introduces is that all delegation must occur through public selection processes; That is, it eliminates the possibility of it being delegated, without competition, to foreign state companies.

The law establishes that regulated and unregulated consumers may install distributed generation systems for self-sufficiency, using non-conventional renewable energy. That is, solar, wind and biomass.

In addition, the law states that the Ministry of the branch may authorize the development, without public competition, of projects identified by private initiative and are not incorporated in the Electricity Master Plan of less than 10 megawatts as long as they are non-conventional renewable generation. .

The Noboa Law creates the National Energy Efficiency Fund.

The resources to finance this fund will come from:

• Contribution for private internal combustion engine vehicles and others defined by the Ecuadorian State. The contribution will be administered and collected by the National Transit Agency and its payment will be a prerequisite for vehicle registration. The value of this contribution will be 1% of the registration fee and must be met by the owners of private internal combustion engine vehicles.
• Programs for replacing inefficient equipment with efficient ones.
• Non-refundable allocations and credits granted in a context of national and international cooperation for the development of energy efficiency projects.

The energy law will guarantee the electricity power generated by the self-generating plant to industrial users, considered large consumers and

their own consumption as long as they are directly connected to the transmission system.

With this, if there were power outages, industrialists who have self-generation would not suffer from the blackouts, which was questioned by some assembly members because it would be “discriminatory” compared to other customers.

Currently, state electricity generation does not include in its rate the investment made for the construction of hydroelectric plants, such as Coca Codo Sinclair.

The effect in simple words was to have an unrealistic or subsidized rate , which is now USD 0.09 on average.

This is a disincentive for a private company that wants to build projects, since it cannot compete with subsidized rates from state generators, assembly members said.

The bill establishes that the cost of electricity service must include “investment.”

The Law approved by the Assembly prohibits any type of delegation to the private sector, subject to the Organic Law of Public Electricity Service, of existing infrastructure that has been financed with funds from the General State Budget.

Sinohydro, the construction company of Coca Codo Sinclair, even proposed to the Government of Guillermo Lasso to take charge of that hydroelectric plant, given the problems it has had.

The assembly members added an article to Noboa’s energy law to open the way for the elimination of the Public Enterprise Coordinating Company (EMCO), as announced by President Daniel Noboa.

To this end, they propose replacing literal a of article 7 of the Public Companies Law to eliminate EMCO from the Directory of Public Companies, so that it is integrated as follows:

• The head of the Ministry of the corresponding branch, or his or her permanent delegate, who will preside over it.
• One or a permanent delegate of the President of the Republic.
• The highest authority or delegate of the National Planning Secretariat.

The assembly members included in Noboa’s energy law proposal that taxpayers can deduct the interest on mortgage and unsecured loans from financial institutions as a personal expense for the purposes of a lower payment of Income Tax.

In addition, they may deduct the salaries they pay to workers affiliated with the Ecuadorian Social Security Institute ( IESS ) as a personal expense for the purposes of paying a lower payment of Income Tax . This benefits people who hire, for example, drivers, gardeners, domestic helpers.

This last benefit will be granted as long as they have complied with their legal obligations with the IESS.

Both proposals were the initiative of the Social Christian Party (PSC) bloc.

The Noboa Law establishes that the Government gives a period of 10 years for commercial transportation (tourist, school and institutional transportation, taxis, heavy cargo) to replace their combustion vehicles with electric ones . They will now have until 2034 to replace the units. This represents an extension of the current term, which was five years and expired in 2026.

On the other hand, it establishes that the competent ministries, in coordination with the GAD, create a scrapping plan for the work vehicles of individuals and public transport that go out of service and are replaced by electric vehicles.

And he adds that starting in 2030, all vehicles that join the urban and interparish public transportation service, as well as commercial transportation in continental Ecuador, must only have 100% electric or zero-emission powertrains .