By: Maria Alejandra Tulipano, Marcela Zelaya, Gustavo Vega and Raúl Garcia
With the purpose of establishing mechanisms that allow ANDA to face the payment of the electric energy supply and with this, guarantee the continuity of the potable water supply, thus alleviating the financial situation, and, seeking to create the effect of avoiding impacts in the tariff schedules of the users of the potable water service; it was requested to consider the suspension of the payment of interests associated to the electric energy supply that the Comisión Ejecutiva Hidroeléctrica del Río Lempa provides to the Administración Nacional de Acueductos y Alcantarillados. Resulting with 61 votes in favor, said amendment was approved.
The reformed articles are detailed below:
Art. 1. Substitute Article 1, for the following:
Art. 1 The Comisión Ejecutiva Hidroeléctrica del Río Lempa (CEL), shall commercialize the electric energy it generates to cover the electric energy consumption of the Administración Nacional de Acueductos y Alcantarillados (ANDA) in the Wholesale Electricity Market, at the price of SIXTY SIX 00/100 DOLLARS PER MEGAVATIO HORA (US$ 66. 00/MWh) plus VAT, this price to be indexed at the beginning of each fiscal year according to the Consumer Price Index for All Urban Consumers of the United States of America, the reference value for this indexation shall be the price index recorded as of December of the year in which the calculation is made and the value recorded for the month of December of the immediately preceding year.
The amount assumed by CEL, under the establishment of this price, in relation to the price at which it sells the energy generated in the Wholesale Market, will be reflected in its accounting and financial statements as an expense of the institution.
Notwithstanding the provisions of the preceding paragraph, in any case, the energy acquired by CEL from third party generators, distributors or other Market Participants, to supply ANDA’s demand, will be marketed to the latter at the price at which CEL acquires the same.
All charges and credits generated by ANDA’s participation in the Wholesale Electricity Market, reflected in ANDA’s Economic Transaction Document issued by the Transaction Unit (UT), will be charged to CEL and will be included by the UT in the monthly settlement of CEL’s transactions, the results of the settlement of ANDA’s operations in the Wholesale Electricity Market will be recorded in CEL’s accounting and financial statements as an expense of the Institution. In the event that CEL markets electric energy to ANDA directly at distribution levels, SIGET shall apply an adjustment in the tariff schedules of the current distributors supplying electric energy to ANDA, to cover the payment corresponding to the Price Differential (PR) generated by such marketing.”
Art. 2. – The supply of electric energy provided by CEL to ANDA and which is required by ANDA for its operation, and which is used by this institution to provide potable water and sewage services to the Salvadoran population, including that destined for pumping and water treatment as required in the customer service centers and other administrative offices of the institution, shall be exempt from any type of interest, charge or penalty related to the concept of arrears or lags in payments, shall be exempt from any type of interest, charge or penalty related to the concept of arrears or delays in payments, therefore, any balance existing at the time of the entry into force of this decree or those that may be generated in the future, Therefore, any balance existing at the time of the entry into force of this decree or those that may be generated in the future, associated with the supply of electric energy required by ANDA for the supply of potable water, shall not generate current or delinquent interest or any other charge or cost related to the concept of delinquency or payment delays, and therefore, any balance existing at the time of the entry into force of this decree or those that may be generated in the future, associated with the supply of electric energy required by ANDA for the supply of potable water, shall not generate current or delinquent interest or any other charge or cost related to these concepts.
Art. 3. – The amounts corresponding to the supply of electric energy provided by CEL to ANDA that on May 31 of each year are pending to be settled by ANDA in favor of CEL, shall be settled through a discount in the amount corresponding to the fiscal retribution that CEL must pay to the Ministry of Finance; if after deducting the aforementioned amounts, there is a remaining balance to be paid by CEL to the Ministry of Finance as Fiscal Remuneration, these shall be discounted in the same amount from the energy supplies that CEL provides to ANDA in the following months, until the total liquidation of the debt, and in the event that after deducting the amounts, the remaining balance is in favor of CEL; the Ministry of Finance is mandated to issue, at the latest within the following month, the Public Treasury Credit Notes in favor of CEL until completing the balance that ANDA owes.
CEL shall issue the corresponding tax documents, once ANDA has made the cash payments or once the corresponding amounts are effectively settled through the discount in the Tax Remuneration or by the collection of the Public Treasury Credit Notes. The fiscal documents issued by CEL will be for the same amount received and until the amount liquidated covers the supply of electric energy.
Art. 4.- The balances that are pending payment by ANDA to the distribution companies for the energy supplied in the distribution networks at the entry into force of this Decree and those that are generated at the end of each month, may be covered with the issuance of Public Treasury Credit Notes by the Ministry of Finance.
Art. 5.- The specific provisions necessary to ensure faithful compliance with the provisions set forth in this Decree shall be contained in the Regulations to be issued by Executive Decree.
Art. 6.- Article 2 of Legislative Decree No. 119, dated August 30, 2012, published in the Official Gazette No. 166, Volume 396 of September 7, 2012, is hereby repealed.
Said amendment was already published in the Official Gazette, exactly in the Official Gazette No. 59, Volume 434, dated March 23 of the current year, from page 19 to page 24. Since this reform has a vacatio legis of 8 days after its publication, it will become effective as of April 4th of the same year.
For further information, or if you have any questions, please contact María Alejandra Tulipano (mtulipano@consortiumlegal.com), Marcela Zelaya (mzelaya@consortiumlegal.com), Gustavo Vega (gvega@consortiumlegal.com) or Raúl Garcia (rgarcia@consortiumlegal.com). They are part of our team specialized in the regulated sector at Consortium Legal El Salvador office.