ICE Awards Thermal Generation Contracts to 2 Companies for Over $82 Million - Expat Community

ICE Awards Thermal Generation Contracts to 2 Companies for Over $82 Million

Oct 20, 2023 | Costa Rica, News & Articles | 0 comments

  • Aggreko International Projects and SoEnergy International selected from 5 received bids
  • ICE Acquisition Board made the decision on October 19


The Acquisition Board of the Costa Rican Institute of Electricity (ICE) has decided to award contracts to two companies for the leasing and operation of 4 power blocks for thermal generation.


The institution foresees the need to generate more electrical energy from thermal sources in the next 3 years. Therefore, on October 1, through the Integrated Public Procurement System (Sicop), the institution launched an expedited bidding procedure.


According to Sicop, the budget for the contract promoted by ICE was around $140 million, but the recommendation for the award is for an amount exceeding $82.3 million.


Based on communications issued on October 19, the institute awarded Aggreko International Projects with the first lot intended for thermal generation at the Moín plant in Limón, for over $58.2 million.


Meanwhile, the second lot was awarded to the company SoEnergy International for generation at the Garabito thermal plant, with an amount close to $24 million.


The companies that submitted bids were:


  • Aggreko International Projects Limited (based in Scotland).
  • APR Energy LLC (United States).
  • Turbo Services Solutions Limitada.
  • SoEnergy International INC (England).
  • Brinks On Power Systems (United States).


Thermal energy is produced by burning a fuel. To generate electricity using petroleum derivatives, special machines are required, which, when combined in a process, function similarly to a car’s engine.


ICE uses diesel to produce electricity. However, a substance called IFO, which consists of equal parts diesel and bunker, is currently being used.


“The contracting of power block leasing and operation services for thermal generation is necessary and urgent to carry out, as there is a need for 146 MW ± 6 MW of power for the country’s energy backup, particularly in the summers of 2024 to 2026.


The purpose of processing this expedited procedure is to address the public interest, provide continuity and support to the electrical service, and therefore meet the country’s energy needs,” as explained by the institute.


ICE pointed out that “with the rental of power blocks, a decision supported by specialized technical studies, the responsibility of ensuring power for the coming years is being fulfilled, thus preventing shortages.”


“The mobile power block technology for thermal generation allows for rapid installation at any location with a fuel source and electric substations where important transmission lines come together,” the state entity added.


In the case of the Moín Thermal Plant, ICE has three diesel storage tanks of 5,000 cubic meters (m3) each, as well as the Moín substation where the Moín-Río Macho line comes in.


On the other hand, the Garabito thermal plant has diesel (1 x 1,791 m3) and bunker (4 x 8,500 m3) fuel storage, which are supplied by tanker truck from the facilities of the Costa Rican Oil Refinery (Recope). It also has the Garabito substation where the Garabito-Barranca-La Caja line comes in.


According to ICE, “due to the uncertainty of a hydrological deficit (caused by climatic phenomena such as El Niño or La Niña), and in order to ensure that the country’s electricity supply is available in case it is needed, the leasing and operation of power blocks for thermal generation is required to maintain the necessary backup for the country’s energy supply.”


The institute claims that this is to “address an energy shortfall and avoid the need for rationing.”


The use of thermal sources implies a potential tariff increase for consumers, as ICE requires additional resources to purchase the diesel necessary for electricity generation.


In September, the Public Services Regulatory Authority (Aresep) ruled out applying an increase of up to 27% in electricity rates that was supposed to take effect in October while adjusting the methodology.


ICE provided the information for price adjustments for the last quarter of the year to account for the costs incurred due to fuel purchases for energy generation amid decreased rainfall caused by the El Niño phenomenon.


Aresep is working on constructing a methodology that, instead of making quarterly adjustments, allows for annual adjustments.



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