Venezuela’s Powerless Revolution – The New York Times


If you squint at NASA satellite photos taken on the evening of Mar. 7, you will see the immediate source of the blackout that paralyzed Venezuela for a week: two tiny wildfires, perilously close to essential power transmission lines.

Zoom out and you’ll see the capital, Caracas, plunged into darkness. On Monday, another blackout struck Caracas and 16 other states. The government has blamed cyberattacks for the blackouts, but under Nicolás Maduro and his predecessor as president, Hugo Chávez, the electrical system was neglected for decades.

To fully understand why it took Venezuela at least four days to restore power in March, you need an even wider lens: one that includes Washington. It is undeniable that Mr. Chávez and Mr. Maduro are to blame for having brought the country to this ruinous state. Nevertheless, United States economic sanctions have left Mr. Maduro’s government unable to resolve the crisis on its own.

The cause of the first blackout is now well understood. A comprehensive report by the chairman of the engineering school at Central University in Caracas shows that the blackout resulted from a wildfire near three power transmission lines from the Guri Dam complex in southeastern Venezuela. The complex includes several hydroelectric dams and power stations that provide 80 percent of the nation’s electricity; its shutdown can thus by itself produce a nationwide blackout.

Certainly, failing to cut back vegetation could have increased the probability of the fire, though wildfires can occur just about anywhere. But the real problem is not so much that a blackout occurred but that it took more than four days to get power back.

To restart the system, dam generators and substations in distant points of the country needed to be activated. But only around one-fifth of the country’s thermal power capacity was operational at the moment of the shutdown, leaving little to no room for thermal generation backup to temporarily replace the energy generated by the dams. The absence of an alternate power source, lack of specialized workers, deteriorated equipment and faulty management thus all appear to have played their part in prolonging the blackout.

Yet United States economic sanctions also played a part. For starters, one of the reasons some of the thermal power plants were down was the lack of fuel necessary to run them. Many of these plants run on diesel, which Venezuela was importing from the United States before the Trump administration banned its trade in January. It is not surprising that many diesel-fueled thermal plants were inactive one month later.

Furthermore, Venezuela’s large electricity sector depends heavily on parts and services supplied by foreign companies. General Electric and Siemens provide most of the power generators used by Venezuela’s oil industry as well as much of the major equipment used in its hydroelectric plants. United States financial sanctions adopted in August 2017 left Venezuela unable to pay its foreign suppliers.

As a result, Venezuela was unable to maintain or replace its power generators, and began relying more on hydroelectricity, contributing to the risks of overloading the system. Venezuela’s oil production also went into a tailspin, with the rate of decline in output more than tripling after the 2017 sanctions, worsening the government’s cash crunch.

Yet it is hard to conclude that sanctions were anything more than a secondary contributor to the causes of Venezuela’s electric grid failures today. Underinvestment, lack of maintenance, and the country’s economic crisis, which has been deepened by corruption and heavily subsidized electricity, are clearly the main drivers. In this sense, Mr. Chávez and Mr. Maduro undoubtedly shoulder the primary responsibility for the electrical collapse.

To have a meaningful discussion on the effect of sanctions, it is crucial to distinguish between the causes of a phenomenon and its remedies. While the blackouts are for the most part attributable to chavismo, it is impossible to address them without removing the constraints that impede the government from contracting and paying foreign corporations for the maintenance and repair of the electrical system. It is not only Mr. Maduro, but also Juan Guaidó, the opposition leader and designated president, and President Trump, who control the levers needed to resolve the energy crisis.

More recent oil sanctions legally bar American companies from doing any business with Venezuela’s state-owned oil company, while non-United States companies face the threat of punitive secondary sanctions for doing business with the Maduro regime. Venezuela’s bank accounts in the United States and Europe are for the most part either blocked or controlled by Guaidó appointees, impeding Mr. Maduro from using them to pay the firms he would need to hire to maintain and repair the electricity grid.

Barring a rapid resolution to the country’s political standoff, the only way to avoid a deepening of the electricity crisis is for the feuding political factions to jointly deploy and manage the resources needed to do so. A first step would be for both sides to agree to appoint an independent task force.

Any proposal for cooperation will be anathema to the factions’ hard-liners, and is likely to be dismissed as unrealistic at best. Yet even in wars, armies clear the way to protect noncombatants and allow aid agencies to rescue the wounded. Unless the country’s politicians can agree to put the lives of ordinary people above the pursuit of their political objectives, Venezuelans will face even darker times ahead.

Francisco Rodríguez is the chief economist at Torino Economics and a former head of Venezuela’s Congressional Budget Office. Jorge Alejandro Rodríguez, an electrical engineer, is the former vice president for power generation and transmission at the Venezuelan utility Cadafe.

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