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Cablegate: Nicaragua - Feedback On Ecpa and Renewable Energy

VZCZCXYZ0000
RR RUEHWEB

DE RUEHMU #0889/01 2512047
ZNR UUUUU ZZH
R 082047Z SEP 09
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 4540
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RHEBAAA/DEPT OF ENERGY WASHINGTON DC

UNCLAS MANAGUA 000889

SENSITIVE
SIPDIS

DEPT PASS USDOE DAN BIRNS
DEPT FOR EEB/ESC DANIELLE MONOSSON
DEPT FOR OES/EGC GRIFF THOMPSON

E.O. 12958: N/A
TAGS: ENRG SENV ECON NU
SUBJECT: NICARAGUA - FEEDBACK ON ECPA AND RENEWABLE ENERGY

REF: A. STATE 67032
B. STATE 73217
C. MANAGUA 166

1. (U) Summary: Econoffs met recently with Vice Minister of
Energy and Mines Lorena Lanza to encourage Nicaraguan
participation in the Energy and Climate Partnership of the
Americas (ECPA) and to solicit feedback on the Americas
Energy and Climate Symposium in Lima. Lanza generally agreed
with USG policy on renewable energy development and noted her
attendance at the recent preparatory meeting for the
International Renewable Energy Agency (IRENA) in Egypt.
Lanza did not comment, however, on Nicaragua's failure to
participate in the ECPA or attend the Lima Symposium.
According to Lanza, Nicaragua is implementing its portion of
the Central American Electrical Interconnection System, or
SIEPAC, and expects to complete work by the end of 2009. End
summary.

2. (U) Econoffs met recently with Vice Minister of Energy and
Mines Lorena Lanza to encourage Nicaraguan participation in
the Energy and Climate Partnership of the Americas (ECPA) and
to solicit feedback on the ECPA and on the Americas Energy
and Climate Symposium in Lima. Topics of discussion also
included the International Renewable Energy Agency (IRENA)
and the Central American Electrical Interconnection System
(SIEPAC). Lanza did not specifically address the possibility
that Nicaragua would participate in the ECPA or submit a
proposal for the Low Carbon Communities program, but she was
open to further discussion on Nicaragua's support for joint
renewable resource efforts.

POSITIVE ON IRENA AND RENEWABLE ENERGY
--------------------------------------

3. (U) Econoffs explained the U.S. decision to sign the
International Renewable Energy Agency (IRENA) Statute on June
29, 2009. Lanza, who attended the IRENA meeting in Egypt
June 28-30, expressed Nicaragua's strong interest in
renewable energy. She said that the Government of Nicaragua
(GON) has developed a strategic energy plan dedicated to
Nicaragua's transition--within the next 5 years--from
dependence on fossil fuels for 80% of its energy production
(primarily imported fuel oil) to the use of renewable
resources to produce 80% of its energy. Although Lanza
provided no additional details, she believes that the
national energy strategy will encourage private investment
for renewable energy projects.

CURIOUS ABOUT THE ECPA
----------------------

4. (U) Lanza expressed general agreement with USG policy
goals on renewable energy. She was interested in
international cooperative efforts related to the ECPA and
wanted to know which countries attended the Lima symposium.
Lanza, however, offered no comment on Nicaragua's failure to
participate in the ECPA or to attend the Lima Symposium.
Lanza did not express any concrete interest in technical
assistance from the Low Carbon Communities project of the
U.S. Department of Energy. She added that "little countries"
like Nicaragua are suffering the consequences of climate
change caused by large, industrialized countries like the
United States.

AND OPTIMISTIC ON SIEPAC
------------------------

5. (U) Lanza stated that the SIEPAC (Sistema de Interconexion
Electrica para America Central, or Central American
Electrical Interconnection System) project was being
implemented successfully in Nicaragua and would give the
country a way to sell any future electricity surpluses.
Lanza said that Nicaragua expects to complete construction of
its SIEPAC infrastructure by the end of 2009. On the
regulatory side, Lanza claimed that Nicaragua will have no
difficulties making the changes necessary to implement
SIEPAC. Lanza was optimistic that SIEPAC would begin to
operate in 2010, and she expressed hope that developing a
regional energy grid would promote much-needed investment in
Nicaragua. The primary challenges with this project and other
energy-related projects, she said, are financial. For
example, Nicaragua's main transmission line is 40 years old
and in need of up of an upgrade.

COMMENT
-------

6. (SBU) Lanza was positive about regional cooperation in
pursuit of renewable energy, but the GON's support for the
"alternative" policies of ALBA, the Bolivarian Alliance for
the Americas, make it politically unlikely for the time being
that Nicaragua will participate in the U.S.-led ECPA or
related projects in any significant way. Nicaragua has made
some progress in developing its abundant renewable energy
resources by facilitating and approving private investment in
wind and hydroelectric power projects, but a highly uncertain
investment climate means that the country will continue to
remain dependent on fossil fuels for the foreseeable future.
CALLAHAN

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