Energy

Distributed Generation: Produce Your Own Energy and Save Money

In January of the past year, the Ministry of Environment and Energy of Costa Rica issued a new regulation to Law number 10086 for the “Promotion and Regulation of Distributed Energy Resources from Renewable Sources.” This law regulates the generation and distribution of electrical energy in the country for self-consumption. The new regulation promotes distributed generation as a way to encourage energy efficiency and citizen participation in energy production.

The new regulation establishes clearer standards for connecting to the electrical grid and selling energy generated by prosumers (producer-consumers) for self-consumption. Prosumers who generate their own energy through solar panels, small hydroelectric turbines, or other forms of energy generation from renewable sources can now sell the excess energy they produce to the national electrical grid, receiving economic compensation for the energy delivered to the grid.

Furthermore, a more simplified and accelerated process for connecting distributed generation systems to the electrical grid is defined, facilitating the adoption of this form of energy production by prosumers. They can sell the excess energy they produce to the national electrical grid and receive compensation for the delivered energy. This way, consumers can save on their energy costs and recoup part of their investment in distributed generation systems.

To encourage the installation of distributed generation systems, a compensation method is offered for the generated energy not consumed by users. This allows prosumers to reduce their electricity bills and, in some cases, generate income from the sale of surplus generated energy, considering:

  1. Measurement: Distributed generation systems must be equipped with measuring devices that allow the measurement of the generated and consumed energy at the point of connection to the electrical grid with the distribution company.
  2. Energy Record: The system operator and distribution companies must keep a record of the energy generated and consumed by distributed generation systems.
  3. Compensation: The energy generated by distributed generation systems will be compensated with the energy consumed by the prosumer at the same point of connection to the electrical grid. Compensation will be made through full net billing, where users will receive a specific amount for the generated energy that they do not consume and inject into the electrical grid.
  4. Energy Valuation: The valuation of the energy generated by generation systems will be established according to the electric energy tariff set by the ARESEP and will be recorded in the interconnection and energy supply contract with the distribution company.

This is a significant step toward the energy efficiency of the country, as it allows citizens and businesses to generate their own energy for self-sufficiency, reducing the need for the state to build large power plants, expensive transmission lines, and distribution networks, thereby reducing energy losses and maintenance costs.

Citizens will have an active role that will not only allow them to reduce their electricity bills but, in some cases, generate additional income. This will make the country more efficient, sustainable, and economically viable by applying this model, rather than the traditional centralized generation. The results will be seen in the short term if the involved stakeholders allow development and do not impose excessive bureaucratic obstacles or limit its implementation due to conflicts of interest in the involved public institutions.

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