Beni line to save US$3.5mn/yr in diesel subsidies

Bolivia's government says the 374km Caranavi-Trinidad transmission line linking Beni department to the national grid will free up US$3.5mn a year in diesel subsidies from 2007, the ABI government news agency reported. The government pays about US$8mn a year in diesel subsidies for power generators, of which about 40% goes to Beni department,where all power generation is diesel-based, the deputy minister of electricity, Carlos Romero, said in the statement. Beni's capital city Trinidad consumed approximately 12 million liters of diesel in 2004 up 7% from 2003, the statement said, citing figures from state oil company YPFB. Trinidad suffers constant power cuts and rationing because state-owned power company Ende does not have the capacity to cover demand, the statement said. Ende requires 40,000 liters of diesel a day to supply power to Trinidad, which is more than it can afford. Congress must still ratify a US$32.2mn loan offered by the Andean Development Corporation (CAF) to build the Caranavi-Trinidad line. Construction of the line will take about two years and is set to start operations by February 2007.