by Rod Hughes

Conscious of environmental concerns, Costa Rica’s government-owned electric company, ICE, has a new drilling technique to concentrate the surface space occupied by its new Las Pailas geothermal power plant on the edge of Rincon de la Vieja National Park. The plant is due to go on line in 2011 with 35 megawatts of output.

The plan is to use a diagonal or oblique method of drilling from a small area instead of vertically drilling the shaft down to the superheated volcanic steam which takes up more surface area. Thus, the turbines will be clumped together. The shafts go down to a depth of 3,000 meters and the steam rises at some 100 kilometers per hour to turn the turbines that move the generators

Currently a bill to allow geothermal drilling in national parks before the Legislative Assembly is meeting opposition from environmentalists who insist that such generators will be detrimental to the ecosystem. Las Pailas is exempt from this concern since it is just outside the national park boundry. The big Miravalles geothermal plant on the flanks of Rincon de la Vieja Volcano, which went on line in 1994, occupies four hectares of land, one hectare for each of the four vertical shafts.

Las Pailas, admittedly a smaller plant, will occupy one hectare by using the diagonal shafts. A hydroelectric dam such as Cachi, by contrast, would put more than 320 hectares under water. In answering environmentalists’ concerns regarding the Miravalles plant, ICE points out that they reforested the plant area with 360,000 trees.

Each “well” going down to the level of the superheated steam costs an average of $1 million and drilling advances three or four meters per hour. The plant on the surface consists of the generator building, a cooling tower and electrical substation.

Note: La Nacion’s latest report again failed to address another environmental concern, namely the high tension lines that run from the plant to the consumer, usually through a cleared area that breaks up normal passage of wildlife through their natural environment.

by Rod Hughes

At last, the Citizen Action Party (PAC) bloc in the Leglisative Assembly agrees with the National Liberation Party and the Libertarian Movement about something: All three would allow ICE, the electric company, to drill in national parks to explore for geotermal energy. The attraction of using volcanic sources is obvious: fossil fuel is expensive and hydroelectric dams cover valuable wilderness and farm land with water and take a long time to build.

Unlike what today’s article in the daily paper La Nacion would have you believe, geothermal power is not pollution-free. The volcanic vapors that escape are laced with sulfur. It is simply much preferable to the alternatives. By drilling a hole 3,000 meters (about 10,000 feet) deep will spin a turbine with volcanic steam rising at an impressive 100 kilometers per hour.

PAC legislator Leda Zamora stated the obvious when she told the paper that the country must do something if “we are not to return to using candles for light.” National Liberation lawmaker Oscar Nunez agreed that the country “must explore every avenue without affecting–in this instance–the national parks.”

Understandably, some ecologists are upset. “Although it is only ICE, there is no way to create (geothermal power) without altering the ecosystem,” warned Luis Diego Marin, president of the Conservation of Flora and Fauna Association. He was thinking not only of the power plant itself but of the string of steel towers carrying high tension cables to get the electricity to the users.

Currently, geothermal power is generated in a plant on the flanks of the Rincon de la Vieja Volocano in Guanacaste province. As far as this newsblog can ascertain, there have been no studies of any effects on the wildlife and plants in the area. Today, the Miravalles plant produces 14% (159 megawatts) of Costa Rica’s electricity, 24 hours per day come rain or shine. A smaller facility at Pailes is under development producing 35 megawatts. Both are just on the edge of Rincon de la Vieja National Park.

But, although ICE estimates that the country has a potential to produce another 865 megawatts, the company also warns that most of the potential in the central and Pacific mountain ranges lie below national parks. The current bill, presented in the 2006 session of the Legislative Assembly, would allow ICE geothermal rights in exchange for making improvements in the national park being used.

Commentary: Despite criticism this newsblog has directed at the country’s branches of government in the past, we must admit that officials here are taking long range actions while in the United States, both major parties seem almost hypnotized into catatonia by the energy crisis.

by Rod Hughes

In an era in which the Arias Administration is doing its best to seek alternatives to imported fossil fuels, 11 electric locomotives languish in the patios of the National Railway System (INCOFER), reported the daily La Nacion. Although 1981 models, they can be easily refurbished and placed back on the tracks at a huge savings in diesel used in freight trucks.

The main sticker is the estimated $1 million each it would take to renovate them. But to replace them with new ones would cost $4 million per unit, so the savings is more than just fuel. Currently, the passenger service with northern areas use diesel-electric locomotives, still far more fuel-stingy than moving them by bus or private car, but far from as cheap to run as the electric train.

Added to the cost are repairs to the electric cables and their supports. In the Atlantic side of the possible cargo service in the Central Valley, the costs would be minimal. The Pacific side is another matter, much of the contact cable above the tack being badly worn and even the H-shaped structures supporting them having been cannibalized for other purposes.

But one important factor that has focused the spotlight on the railroads again, after being moribumd since 1995 when the Figueres Administration decided to close down the system as a money-losing venture, is that 78% of the imported fossil fuel importer here goes for transportation, and 66% of that goes to move cargo. (When INCOFER became moribumd, petroleum was far below $100 per barrel.) Even diesel locomotives are more efficient

Electrical engineer Luis Diego Bolanos (a former INCOFER director) told La Nacion that the railroad can move the same amount of cargo as a semi truck at one-fifth of the cost, even with deisel locomotives. A train can move 1,200 tons of cargo (about 40 trailer loads) on the flat or 800 tons (26 trailer loads) over mountinous terrain. Moreover, the 11 locomotives that have been sitting unused since 1995 are special heavy-duty types quite comparable with new types.

So, if trains are more efficient than trucks, why was INCOFER discontinued in 1995? The problem was that trucks could deliver directly while the merchandise had to be transported on the last leg of its sojourn from a central railhead to warehouse or store. But, as we have noted, that was before petroleum soared to $140 per barrel. Today, short haul from the railhead looks more attractive.

by Rod Hughes

What if they gave a fish auction and nobody came? And are Costa Rica’s tourism sportfishing boats going to have to equip themselves with torpedos before the large international fishing boats will let them alone?

First the auction. Last month a court in the Pacific port of Puntarenas was forced to turn back to the tuna fishing boat Tiuna 230 tons of yellowfin tuna confiscated when the Panama-flagged vessel was caught fishing in Costa Rica’s territorial waters. Nobody bid on the tuna. The charges against 23 crew members was dismissed but the captain, Ariel Bustamonte, still faces charges of fishing in the World Patromony-protected waters off Cocos Island. The charge states that he caused $12 million in environment damage.

The case has already turned up a clerical error in the Legslative Assembly that leaves Costa Rica seemingly wide open to pirate tuna fishering. Anyway, under the law the maximum fine Bustamonte faces, according to The Tico Times, is only a paltry $28,000.

Meantime, Central America’s leading English-language publication turned up a more distrubing situation, the threatening behavior of international fishing vessels against Costa Rica’s sportfishing boats. Charter captains taking tourists out for sportfishing have reported three such incidents in the several weeks leading up to The Tico Times edition of July 4.

There was nothing vague or subtle about these aggressions. In the June 20 event, four sportfishing boats were chased off a school of tuna in the waters off Quepos by a commercial tuna vessel’s helicopter buzzing them and then dropping explosives nearby. Witnesses reported seeing an AK-47 automatic weapon in the chopper.

The very next day, seven boats north of Jaco were trapped in the circle of a commercial vessel’s long nets, threated by the boat and its helicopter for a full hour. (That the tuna vessel is registered in Nicaragua by a Panamanian company shows how difficult is prosecuting them.) On June 22, a sportfishing boat was menaced by a tuna boat off Cabo Blanco.

Commentary: This is not the first instance of such aggression. Two decades ago, when this reporter was in The Tico Times newsroom, he investigated a similar case in the waters off Flamingo. At that time, unlike in the above three cases, the boat had no way of documenting the threat on film. In the above cases photographic evidence has been turned over to the Costa Rica Fisheries Institute (INCOPESCA)

In the case of the Tiuna there is no excuse for fishing in the priceless ecological treasure trove of Cocos Island waters. Tuna fishers carry the latest global positioning aparatus and the island is known worldwide as a protected area. The Legislative Assembly should pass emergency measures to rectify their errors–as well as to bring to millions the dollar fines for infractions. The only way to punish naked, callous greed is by hitting the pocketbook. Moreover, the country’s 12-mile limit for licensed commerical fishing should be extended to 40 or even 60 miles.

The dismissal of charges against the crew has been condemned by Costa Rica’s Chief Prosecutor Francisco Dall’Anese and MarViva, a private ecological watchdog foundation instrumental in Tiuma’s capture, questions whether Costa Rican courts are serious about protecting their environment. They spent an estimated $40,000 in the patrol that led to that capture.

The threatening of sportfishing vessels is no less than a violent act. The tuna fishers are large ocean-going ships and one touch of their steel hulls could sink the tourist boats with possible loss of life. It underscores the ruthlessness of these pirates who consider the entire Pacific Ocean their own. An international unwritten law exists that if a vessel is already fishing an area, all others steer clear.

Due to the international nature of the big tuna fishers’ ownership, diplomatic pressure should be applied to deprive these vessels of their flags and registries. Otherwise, not only could it drive perfectly legal fishing boats from the seas but help usher in a lawless era where raw force usurps rights of free use of the waves.

<strong>by Rod Hughes</strong>

A special commission from Costa Rica is scheduled meet next week with the Venezuelan government to try to reach an agreement that would ease Costa Rica’s purchase of petroleum. Before the rapid increase in oil prices, the government turned a cold shoulder to President Hugo Chavez’s overtures but President Oscar Arias, showing his colors as an astute political pragmatist, has softened his position lately.

Early in the second Arias Administration, Chavez and Arias exchanged barbs from afar, Arias calling the Venezuelan chief of state a dictator-in-the-making and Chavez urging Costa Rican voters to reject the Central American free trade pact in a referendum last October. Relations remained frigid when the two countries rejected each others’ ambassador appointees.

But, in an unexpected but politically creative stroke, Arias responded by appointing leftist history professor and expresidential candidate Vladimir de la Cruz as ambassador to Venezuela. As the weekly <em>The Tico Times</em> noted, de la Cruz is a former Communist party member far to the left of Arias but friendly to Chavez’s point of view. Arias, with his free-market neo-liberalism, was not expected to do this. In fact, he has dragged his party, some members kicking and screaming, to the right on many issues, co-opting the already weakened Social Christian Unity party at times.

For some months the leftist public employees’ union ANEP and deputy Jose Merino have been urging, probably without much hope, to at least reach an accord with Chavez about petroleum. Their hope is to get longer term, softer payment conditions and to obtain security that the country would receive fuel regardless of world market conditions. Energy Minister Roberto Dobles admitted that he hoped to get the same breaks as do members of the Chavez-sponsored Pertrcaribe group, a membership in which Costa Rica rejected earlier.

The daily newspaper<em> La Nacion</em> noted that Petrocaribe member nations pay 50% of their fuel purchases within 90 days and the rest over a 25 year period at a bare 1% interest. As Jose Leon Desanti, president of the national refinery (RECOPE) observed, until three months ago, the Venezuelan petroeum company Pedrovesa allowed this country three months to pay for its oil but after a restructuring of the company it is all but cash on the barrelhead, a mere week, which forces RECOPE to resort to costly loans. Since the country gets 90% of its fossil fuel from Venezuela, this puts an economic crimp in the budget.

Meanwhile, Chavez plays Lady Bountiful to countries unblessed with petroleum reserves. <em>The Tico Times</em> reported last Friday that Chavez is offering to pay all expenses for Costa Ricans to have eye operations in Venezuela—transport, accommodations, surgery and all. This underscores a deficiency in the socialized medicine here where residents must wait up to a year for catarract surgery and this offer must rankle the Arias Administration but there is little that can be done to offset the offer.

It is wonderful what public relations miracles one can accomplish if one is sitting on a comfortable petroleum reserve…

by Rod Hughes

As the continued rise in petroleum prices threatens to imbalance Costa Rica’s foreign exchange, the government would like nothing better than for Ticos to think more about dumping their SUVs in favor of a hybrid car. Purdy Motors is all for that.

Purdy, a longtime fixture in the national motoring scene, is the only Costa Rican importer who had the foresight to bring in hybrid cars, notes an exclusive business story in the weekly The Tico Times. So you can have any kind of hybrid here as long as it is a Toyota Prius. From Purdy Motors.

Although Purdy has been importing the Prius since 2004, only about a hundred hybrids cruise the country so far, according to the importer’s marketing manager, Luis Mastroeni. One of the measures the Ministry of Energy and Environment has urged to cut imports of expensive petroleum are hybrids and electric cars. Mastroeni claims that Purdy is the only dealer in all of Latin America to see the handwriting on the wall and pay attention to hybrids.

Environment Minister Roberto Dobles would like further tax breaks on hybrids. Even now, the Prius buyer pays only a 34% Selective Consumption Tax as opposed to 52% for other vehicles. Still, Tico Times reporter Leslie Friday questioned whether many Ticos would pick up the Prius’s rather hefty price tag of $36,700.

Although the paper says that Dobles is interested in electric cars and thinks the nation’s electric grid can handle the extra load, no importer has yet to jump at the opportunity.

In other pretroleum crisis news, 60 heavy cargo trucks held a slowdown on the roads between Alajuela and Paseo Colon in San Jose to protest rising fuel prices, causing traffic jams that effected the entire metropolitan area. What the drivers of these semi-truck-trailers hoped to gain by blocking traffic, other than to inconvenience their fellow citizens, is hard to imagine. Certainly the government has no hold over OPEC and is, indeed, as concrned about the situation as anyone else.

by Rod Hughes

The heads of political blocs in the Legislative Assembly are all agreed that elimination of the 97.50 colon-per-liter tax on diesel fuel but only if the gasoline tax is not increased. Thie addition of the diesel tax to gasoline would have served a dual purpose for the Arias Administration—as an anti-inflationary measure while assuring that gasoline consumption for private cars would have diminished. This would help the country’s balance of trade.

But the higher gasoline tax, on top of increased prices for petreolum fuels, would have been wildly unpopular with motorists. Oscar Nunez, floor leader of the administration’s National Liberation Party, admitted that the original plan was not “politically viable,” according to the daily La Nacion, and some other way would have to be found to fill the budgetary “hole” left by the elimination of the diesel tax.

Like most modern nations, Costa Rica moves its produce, as well as all retail products, to market by diesel-powered truck. Moreover, the high price of the fuel has placed a pinch on bus lines in a country where public transport is vital. Cutting out the diesel tax might avoid a hike in fares which would severely limit the mobility of the poor. But, since most taxis here have gasoline engines, this sector of the public transport picture would be hurt. Taxi owners also have a habit of striking by blocking public thoroughfares, which they have done before for far less cause than higher fuel prices.

Nunez speculated that two ways to fill the budgetary shortfall would be cut spending on non-social programs—if any can be found. Another alternative would be raising the exit tax at airports, already $26. But, along with the increasing airline fares, this would hurt one of the prime sources of foreign exchange, tourism. (Past administrations have done this. It never seems to occur to politcos that you can milk tourists many times, but you can only skin them once…)

The lawmakers are being yanked this way and that. Friday the Chamber of Transporters (bus ines) threatened a general strike if the diesel tax was not removed. The Liberatian Movement, characteristically backing less government involvement, are urging the slashing of programs within the budget and are firmly opposed to the increased gas tax which would nearly double the price of premium. Libertarian deputy Ovidio Aguero snidely suggested that the administration pay fewer consultants and use the money to offset the diesel tax shortfall, a reference to the administration’s use of private donations such as the $2 million given by BCIE, an international bank.

Political sarcasm aside, even within parties deputies are divided in their counsels. Citizen Action Party (PAC) deputy told La Nacion that he isn’t opposed to adding the tax to gas while his fellow PAC representative, Francisco Molina, is vehemently opposed. And some are making political hay. Without offering any solution, Social Christian Unity deputy Jorge Eduardo Sanchez let it be known that he would support the bus lobby in congress as well as in the streets if they choose to strike.

by Rod Hughes

Central Bank President Francisco de Paula Gutierrez warned the country yesterday that vigorous “economic adjustments” are on the way in order to combat the effects of the skyrocketing petroleum and worldwide food prices and slumping foreign trade. Among these measures will be tighter credit, higher interest rates and a push to increase exports.

Gutierrez, in an exclusive interview with the daily La Nacion, stated, “The adjustment has to come from every side, from less internal demand. There will be restrictive monetary policies.” Internal demand includes buying by consumers, companies and the government from sources within the country, he explained.

During April, May and June, the Central Bank began a campaign of buying up colones, using millions of dollars in its reserves. And, already public banks have begun to raise interest rates. The measures will mean that Tico consumers have fewer colones with which to buy things, a condition that will hardly make retailers happy. Nonetheless, Gutierrez promised that the changes would be gradual and not abrupt. The search for new export markets also cannot be accomplished overnight.

Especially worrisome is the balance of payments deficit caused by soaring petroleum prices and shrinking export trade. Gutierrez foresees this continuing for a time. The government has already taken measures to reduce gasoline use by trying to reduce the time motorists spend idling their engines in traffic jams. This measure, introduced in late June for peak traffic hours, will definitely be extended for all day on one day per week, according to the final number of the license plate. The daily La Nacion observed in today’s edition that after peak hours, long convoys of trucks cause further traffic jams and this simply alters the time of the jams instead of eliminating them.

Gutierrez said that the opening of the telecommunications and insurance markets may alleviate the balance of payments somewhat by stimulating foreign investments. Those bills have passed the Legislative Assembly after a long, hard political battle.

But the country’s top banker is promising no rose gardens. “Costa Ricans have to understand that the situation we are currently navigating is much more difficult than what we had a year ago. It will require more prudence and discipline from people.” A year ago, unemployment was at record lows and the government was able to reduce the national debt while ending the year with a budget surplus.

by Rod Hughes

This reporter once wrote in an opinion piece in The Tico Times that the invention of plastic may have been the worst disaster to happen to this tropical paradise. The pesky material litters the streets, clogs landfills and stormdrains and poisons animals, as well as the very ground itself. Apparently two major supermarket chains in the country not only agree but are doing something about it.

In an exclusive, detailed story in the English-language weekly The Tico Times, reporter Leland Baxter-Neal recently wrote that Auto Mercado and Mas X Menos chains have begun treating the problem, the former by offering biodegradable plastic sacks and both by rewarding customers for carrying their purchases away in reuseable cloth bags.

The problem, like that of rising fuel prices, is worldwide and Baxter-Neal reported that the governments of China, Ireland, Rwanda and Bangladesh have banned use of plastic bags while Australia has a pending bill in parliament to do so. While it is unlikely that Costa Rica’s unbiquitous pulperias (neighborhood stores) will heed the call, it is a step in the right direction.

It would seem that Costa Ricans, although notorious litterbugs themselves, are taking to the new strategy. An Auto Mercado spokesman told the reporter that the various market outlets have sold 10,000 cloth bags and they have been used 19,000 times. Wal-Mart did a trial of the bags meant to last three months and, priced at less than 2,000 colones (about $3.70), they sold out within a month. Both companies are selling them at cost and they are made in Costa Rica.

A La Nacion news story once reported that a standard plastic bag lasts 130 years before decomposing completely. The Tico Times reported that even when it does, many of the chemicals of which it is made are toxic. The country lacks a true recycling plant for them, but Auto Mercado does receive them to donate the plastic to a company here that makes souvenirs and trinkets.

by Rod Hughes

Like most Western nations including the United States, Costa Rica is wrestling with the effects of high petroleum prices and is divided on how to keep them from impacting the economy negatively. The Arias administration thought the government could best improve the nation’s balance of trade while controling inflation by taking the tax off diesel and adding it to gasoline sales. But that plan is now meeting a chorus of protest.

The latest to oppose the idea is a flipflop by the Citizen Action Party (PAC) bloc in the Legislative Assembly which initially thought it might be a good idea. But now they have backed away from the idea after having a look at the way the bill was drafted. PAC now plans to use its usual tactic of drowning the measure in an avalance of amendments. Even new PAC defector Andrea Moirales, now an independent and an opponent of using such blocking tactics, says she has her doubts that this is the way to confront the energy crisis.

Like most countries, Costa Rican stores receive their products by truck and the idea of reducing the price of diesel is to help retailers refrain from hiking the prices of their merchandise. Also, adding to the price of gasoline would stop the increasing use of that fuel, consumption of which has risen this year despite high prices at the pump. Bus transport, a big factor in this country, would also be effected and keeping the price low to passengers would encourage many to leave their cars at home and ride to work on public transport. One such government plan is now in effect, but that one does not need Legislative Assembly approval.

One sticking point is that the bill would increase the price of regular and premium gasoline for cars but leave jet fuel and bunker alone. But PAC deputy Ronald Solís groused, “Why should Tico motorists subsidize the big airlines?” “Now (that we see the bill) we realize that things are not what we hoped,” he explained to the daily La Nacion.

Despite a special plea by Minister of the Presidency Rodrigo Arias to speed up passage of the energy bill, it appears it is an orphan lacking support among the opposition parties. One National Liberation party legislator told La Nacion that the administration’s lawmakers would call the chiefs of the various blocs together to see if a compromise can be hammered out.