| Costa Rica | May 03, 2019
It is well known that Costa Rica boasts some of the cleanest energy mixes on the planet, recording many days in which the whole country is powered solely by renewable energy sources throughout the year.
Over the years, green policies have seen little resistance from all sides of the political spectrum, but one sector continues to limit the small Central American country’s green goals; transport. More than 40% of the country’s CO2 emissions come from energy production to power transportation, but that might be about to change.
This is an issue that Carlos Alvarado, which was elected as president of Costa Rica in April 2018, has brought to the center of his policy drive when, in his victory speech, he declared that Costa Rica would end the use of fossil fuels in transport by as early as 2021. That is the year in which the country celebrates 200 years of independence and just a year before the end of Alvarado’s mandate.
The bold move has brought attention from overseas at a time when climate change-denial rhetoric gain renewed strength in the US and elsewhere. While it seems a bit overly optimistic to see the end of fossil fuels in Costa Rica within the next three years, it seems clear that the president intends to accelerate that process.
Some projects are already underway toward reaching that goal, and none has been more in the spotlight than the electric railway connecting the Great Metropolitan Area (GAM), which connects Alajuela, Heredia, San José, and Cartago. Currently, the connection between these urban centers is assured by the Instituto Costarricense de Ferrocarriles (Incofer) through an aging diesel-powered railway system.
The new railway is expected to be faster, more efficient, carry more people, and be completely emissions free. It is, however, extremely delayed. First proposed in 2014, the electric railway planned to stretch for 73km and carry 250,000 people in its first year of operation, with trains running every 10 minutes and reaching farther than the current system, including the Juan Santamaría airport. The project is estimated to come at a cost of USD1,95 billion and, at first, was proposed to be ready by May 2018. However, the high cost of the endeavor produced consistent delays and Incofer did not launch a solicitation for proposals from private companies to develop the project until early 2018. For a while, it was uncertain if the project would go through at all in light of the elections held in April. When Mr. Alvarado replaced Mr. Luis Solis in the presidency, both belonging to the same Citizen’s Action Party, it seemed like the project would have a future. As soon as he was elected he reaffirmed his intention to build the railway system starting in 2021 and having its first stage operating by 2022.
Now, Incofer is searching for a private partner that will finance USD1.3 billion of the project’s costs. A study developed by L.C.R. Logistica S.A for Incofer estimated the project would cost USD1.3 billion for the fixed infrastructure, up to USD288 million for the actual trains and would cost up to USD12 million per year to operate and maintain. The private player that comes forward with the money would be granted the concessionaire contract for the railway for a number of years in order to recover its investment and profit (L.C.R. Logistica’s report suggests 15 years), at a cost for the consumer of USD1.86 per trip. In 2017, Incofer announced it had received interest from companies in Spain, Switzerland, China and Italy to develop the project, but no concrete interest is yet known for the current offer. In October 2018, the government announced a new bid round for the project would be launched and concluded within 2019.
In the meantime, Incofer is investing USD52 million in renewing its diesel-powered fleet, replacing damaged or crashed wagons with up to 10 new trains. This is meant to help maintain the service until the start of operations of the new electric railway system.