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Venezuela Gives Preliminary Nod for Private Sector Entry in Electricity Sector

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Venezuela's National Assembly on Tuesday gave preliminary approval to a reform which proposes to allow private sector investment in the country's electricity sector, according to multiple media reports.

The proposal would permit private companies to generate and sell electricity under government concessions, ending over 15 years of state control, Bloomberg reported.

The reform, which won unanimous preliminary backing from lawmakers, would open the sector to private firms, mixed enterprises, and companies with minority state ownership, alongside state operators, the report said.

It also intends to have tariffs that reflect service provision costs while providing a decent return on investment to operators.

The proposal must now proceed to a second, final vote.

The proposed reforms in Venezuela's power sector follow similar steps to overhaul the country's oil industry and reflect President Delcy Rodriguez's efforts to attract foreign investment to strategic industries, the report said.

The country's power sector is undergoing a severe crisis without adequate investment and maintenance, Reuters reported.

Much of the country regularly faces hours-long power outages in turn affecting water and telecommunications services, the report said, adding a shortage of power has also created doubts amongst investors over the feasibility of proposed projects.

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