2009 was the last time Ecuador suffered a blackout. Before that, in the first half of the 1990s, there was also a period of blackouts that even led the country to take extreme measures such as Sixto Time, with which Ecuadorians moved their clocks forward by one hour at the end for ten weeks. In 1992, Miguel Ángel González, president of the Ecuadorian Business Committee, remembers how the manufacturing sector faced those times, the negative impact it produced and the current concern over the specter of blackouts.

How did the power cuts that occurred in the 1990s and 2009 affect the manufacturing sector, what was the impact on revenues?

Historically, power outages have had a significant impact on the Ecuadorian economy. Estimates show that repeated blackouts that occurred in the 1990s cost the country $1.8 billion. The blackouts that occurred in 2009 would have cost the country $1.5 billion. As expected, the productive sectors of the Ecuadorian economy are the most affected. For reference, in 2022, electricity consumption in the industrial sector represented 42% of total electricity consumption. In other words, about half of the losses caused by power outages are historically faced by the industrial sector.

The authorities reassure the citizens and change the announcement stating that there will be no more special exclusions

How did the sector welcome these periods?

The business sector faced periods of power outages by implementing measures to mitigate the impact. Many companies have invested in backup systems, such as electrical generators and energy storage systems, to ensure continuous supply during power outages.

Are you ready for a similar situation in these times and how much additional investment would that be?

Today, many companies are better prepared than in previous decades to face similar situations. However, preparation may vary by size and industry. Additional investments, such as the purchase of electric generators, can be expensive and put smaller companies out of business.

What would be the effect on the productive sectors of the re-solution of electricity rationing?

The impact on the production sector will depend on the magnitude of the power outages. That is, initial estimates vary considerably. However, from the commercial sector, we view any negative impact regardless of size with concern. It should be noted that economic growth estimates have worsened and point to a slowdown in the economy by 2023. In this sense, we in the commercial sector cannot afford to take this possibility lightly.

Sixt’s Time: Fearing power outages, Ecuador recalls the energy crisis of thirty years ago

Which sectors would be most affected and why?

The sectors that could be most affected are those that need electricity the most for their economic activities. According to the Ministry of Energy and Mining, the industrial and commercial sectors would be most affected. Data show that in 2022, the industrial and commercial sectors consumed 42% and 14% of electricity, respectively.