Venezuela's electricity crisis stems from a severe drought linked to the climatic phenomenon El Nino. Experts also blame the government of President Hugo Chavez for what they call short-sighted planning. Hydroelectric dams such as the El Guri reservoir in the south-east have reached critically low levels. The government has built some new thermoelectric power plants but not enough to satisfy rising electricity demand and this month introduced rolling power cuts to enforce rationing.
Restaurants, small businesses and homeowners have rushed to buy generators to protect themselves. "I sold out of medium-sized plants when they announced the rationing. These are good for businesses because they run several bulbs and an air-conditioning unit," said Carlos Caraballo, manager of a Caracas store selling motors. Octavio Casado, director of Comelecinca, a company that imports medium to large electric generators for sale to banks, hospitals and shopping malls, said interest had shot up since the power crisis hit Venezuela. "We were selling 300-400 machines a year. This year we have orders for more then 1,000 machines. It's a record," he said. "We are working in a market of people whose operations cannot be stopped when there are outages."
Analysts say the trend for privately used generators is likely to boost domestic demand for refined oil products such as diesel, lowering Venezuela's ability to sell them abroad. According to the Office of Interconnected Systems Operation (OPSIS) diesel consumption increased by 15 percent to 54,780 bpd between January and November last year. "From now on we are going to see an increase in the consumption of diesel for all the shopping centers and other places," said Jose Manuel Aller, a specialist in electric engineering at the Simon Bolivar University in Caracas.