Costa Rica secures $300M for grid modernization amid audit warnings

The Costa Rican Electricity Institute (ICE) has secured $300 million in financing to modernize the National Electric System (SEN). The funding includes $200 million from the European Investment Bank (EIB) and $100 million from the French Development Agency (AFD). This investment aims to strengthen transmission and distribution networks and support electricity generation from renewable sources to enhance system resilience and sustainability.

However, an audit by the Comptroller General of the Republic (CGR) has raised alarms regarding significant delays and cost overruns within ICE’s electrical transmission projects. The report identifies widespread management failures, noting that three out of five investment projects face delays ranging from 1.5 to 6.6 years. These inefficiencies have resulted in accumulated cost increases of ₡13,437 million due to redesigns and inadequate pre-investment studies.

The CGR warned that these infrastructure bottlenecks could hinder the integration of renewable energy and the country’s decarbonization goals. Specific projects, such as the Miravalles Ring and the Nicoya Peninsula works, have faced substantial budget increases and delays. Additionally, the audit highlighted that the average time to assign high-voltage grid connection points is approximately 324 days, creating uncertainty for solar energy projects.