Organic On The Public Service Of Electricity Law

Original Language Title: Ley Orgánica del Servicio Público de Energía Eléctrica

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now

Read the untranslated law here: http://www.asambleanacional.gob.ec/es/system/files/ro_ley_organica_del_servicio_publico_de_energia_electrica_ro_418_tercer_suplemento_del_16-01-2015.pdf



FULL considering: That the constituent Assembly in session from 13 May 2008 issued mandate constituent No. 9, promulgated in the registry offi cial No. 339 of May 17, 2008, whose objective was the adoption of measures to solve the lack of investment in the sectors of electrical and telecommunications companies, to meet infrastructure needs , to date, has fulfilled its purpose, boosting them with the injection of government resources;

That the constituent assembly into session on July 23, 2008 issued mandate constituent No. 15, issued in the supplement of the registry offi cial No. 393 of July 31, 2008, through which moved deep structural changes in the electricity sector that produced, among others, the fi XING of the one-time fee, the recognition, through the Ministry of finance the difference between the costs of the outage and the single rate, the Elimination of the concept of marginal costs for the calculation of the costs of generation, the State contribution for the components of investment for the expansion in distribution and transmission costs and the extinction of obligations of electricity companies for transactions of electricity, which has allowed new electrical projects around the country economic sustainability and the overall development of the Ecuadorian electric sector;

That the Constitution of the Republic of the Ecuador, posted in the registry offi cial N ° 449 20 October 2008, orders in article 85 that the formulation, implementation, evaluation and control of public policies and the provision of public goods and services that ensure the rights recognized by the Constitution is will guide to enforce good live and will be developed starting from the principle of solidarity;

That paragraph 9 of article 11 of the Constitution of the Republic of Ecuador stipulates that the highest duty of the State is to respect and enforce the rights guaranteed in the Constitution, being forced the State, its so empowered, dealers and any person acting in the exercise of a public authority, to repair the violations of the rights of individuals by the failure or defi ciency in the provision of public services , or by the acts or omissions of its servants in the performance of their jobs, and the State proceed with exercise, immediately, the right to repeat against the people responsible for the damage caused, without prejudice to the civil, criminal and administrative responsibilities to any place;

4-third supplement-record offi cial No. 418-Friday 16 of January of 2015 that, the article 14 of the Constitution of the Republic of the Ecuador recognizes the right of the population to live in an environment healthy and ecologically balanced, that ensure the sustainability and the good live, the sumak kawsay and declares of interest public it preservation of the environment , the conservation of them ecosystems, the biodiversity and the integrity of the heritage genetic of the country, the prevention of the damage environmental and the recovery of them spaces natural gradients;

That article 15 of the Constitution of the Republic of Ecuador notes that corresponds to the State, in the public and private sectors, to promote the use of environmentally clean technologies and non-polluting alternative energies and low-impact, as well as the energy sovereignty will not be achieved at the expense of food sovereignty, nor shall affect the right to water;

That, article 287 of the Constitution of the Republic of Ecuador States that any standards which create an obligation fi nanced with public resources will establish the appropriate funding source. Only institutions under public law may fi nanciarse with fees and special contributions laid down by law;

That article 301 of the Constitution of the Republic of Ecuador States that fees and special contributions will be created and be regulated in accordance with the law;

That the Constitution of the Republic of Ecuador establishes in paragraph 2 of article 133, which will be issued with the character of organic, laws governing the exercise of rights and constitutional guarantees, therefore, being strategic and public electricity service is a right and a constitutional guarantee, this law should be the basic hierarchy;

That, article 313 of the Constitution of the Republic of Ecuador, establishes that the State reserves the right to manage, regulate, control and manage the strategic sectors in accordance with the principles of environmental sustainability, precaution, prevention and efficient science and is considered a strategic sector energy in all its forms;

That article 314 of the Constitution of the Republic of Ecuador establishes that the State shall be responsible for the provision, among others, of the electric power public service;

That, article 315 of the Constitution of the Republic of Ecuador States that the State may constitute public companies for the management of strategic sectors, the provision of public services, the sustainable use of natural resources or public goods, and the development of other economic activities;

That article 316 of the Constitution of the Republic of Ecuador indicated that the State may delegate participation in strategic sectors and public services to ventures in which have majority shareholder and may, exceptionally, delegate to private initiative and the popular solidarity, economy the exercise of these activities, in case that establishes the law;

That, Article 395 of the Constitution of the Republic of Ecuador States that the State must guarantee a model sustainable development, environmentally balanced and respectful of cultural diversity, which retain capacity for natural regeneration of ecosystems and biodiversity, and ensure the satisfaction of the needs of present and future generations;

That, the article 413 of the Constitution of the Republic of the Ecuador establishes that the State must promote the efi science energy, the development and use of practices and technologies environmentally clean and healthy, as well as of energy renewable, diversifi Ed, of low impact;

That the increase in demand for electricity as a result of the growth of the population and the economy, is not only a great challenge, but requires the use of new sources of energy supply and conduct of public consumption and citizen, commensurate with the scale of the challenge;

Whereas it is imperative to build an array of economic and ecologically balanced electricity generation, increasing the participation of clean renewable and energies such as wind power, biomass, biogas, photovoltaic, geothermal, tidal and hydroelectric power, decreasing the thermal generation ineffi cient that uses fossil fuels;

That, the modernization of the networks electric should consider aspects regulatory, networks of transport and distribution of energy, networks of communication, generation distributed, storage of energy, measurement intelligent, control distributed, management active of it demand and opportunities of provide new products and services;

That it is obligation of the State to promote the development of economic activities by means of a legal and institutional order that promotes and fosters the participation of different social, economic and business sectors;

That is the duty of the State provision of the public service of electricity that serves as a tool to promote the development of industries in the country;

Whereas it is imperative to have a new legal framework for the electricity sector, in accordance with the provisions of the Constitution of the Republic of the Ecuador, the national reality, updating its institutional structure; and, in exercise of their powers constitutional, issued the following: third supplement-registration offi cial No. 418-Friday 16 of January of 2015-5 law organic of the service public of energy electric title I provisions fundamental article 1.-object and scope of the law.-the present law has by object ensure that the service public of energy electric meets them principles constitutional of mandatory , generality, uniformity, responsibility, universality, accessibility, regularity, continuity, quality, environmental sustainability, precaution, prevention and effi ciency, which, is through this instrument, regulate the exercise of the responsibility of the State for planning car, run, regulating, control and manage the public electricity service.

This law regulates the participation of the public and private sectors in activities related to the public service of electricity, as well as promotion and implementation of plans and projects with renewable energy sources, and the establishment of mechanisms of energy effi.

Article 2-Objectives the Act specifi-specific objectives of this law are: 1. comply with the provision of the public service of electricity to the consumer or user fi nal, through activities: generation, transmission, d retailing and marketing, import and export of electrical energy;

2 provide to consumers or users fi nal a public service of electric power quality, reliability and security; as well as the general public lighting as required according to the specifi ed regulation;

3 protect the rights of consumers or users end of the public service of electricity;


4. ensure the governability of the sector through an appropriate institutional structure, a defi nition clear roles and accountability system;

5 develop mechanisms of promotion by the State, which encourage the technical and economic exploitation of energy resources, with an emphasis on renewable sources. The promotion of biomass will be development in the origin of solid waste.

6 develop effi ciency energy policies to be met by natural and legal persons who use power or provide goods and services, encouraging the protection of the environment;

7. design mechanisms that allow ensuring the sustainability economic and fi nancial of the sector electric;

8. ensure equality and widespread use of the service you and facilities of transmission and distribution; and, 9. Develop the energizing rural.

Article 3.-Defi nitions.-for purposes of this law, shall be taken into account the defi nitions General following: 1. affecting the public service: condition in which are goods and facilities necessary to meet the purpose of the public electricity service. They may not be removed without the respective authorization. Included within this condition to goods and facilities belonging to the autogenerators.

2. general public lighting: is the lighting of public roads, for the transit of persons and/or vehicles. Excludes the lighting of the areas common of units real estate declared as property horizontal, the lighting public ornamental and intervened.

3. street lighting intervened: is the lighting of pathways which, due to plans or decentralized autonomous governments specifi c requirements, eren diffi lighting levels established by regulation, and/or require a constructive infrastructure other than the standards set for general lighting.

4. ornamental street lighting: it is the lighting of areas such as parks, squares, churches, monuments and similar to diffi ere of the levels established by regulation for general lighting, since they obey aesthetic criteria determined by corresponding decentralized self-government, or by the competent State body.

5 autogen: Dedicated to a productive or commercial activity juridical person, whose power generation is intended to supply your demand, and can eventually produce surpluses of generation that can be made available on demand.

6 consumer or end user: natural or legal person that is benefi cia with the provision of the public service of electricity, as the owner of the property where this is provided either as a direct recipient of the service.

7. electric company: legal person of public or private law enabling entitled empowers you to activities of generation, transmission, distribution and marketing, import or export of electric power and general lighting service.

6 third supplement - registration offi cial No. 418 - Friday 16 of January of 2015 8. Electric power: flow of electrons produced based on primary energy sources, using electric generators, transported and distributed to the consumer or end user installations.

9. energy renewable: are them from of sources that do not decrease by effect of its use: hydraulic, wind, solar, geothermal, biomass, tidal, nuclear and others.

10. energy renewable not conventional: is considered as energy renewable not conventional to them sources: solar, wind, geothermal, biomass, tidal, hydroelectric of capabilities under, in them terms and conditions established in the normative, and others that is llegaren to defi nir in the regulation respective.

11 great consumer: natural or legal person whose characteristics of consumption defi ned by the Agency for the regulation and Control of electricity - ARCONEL-through the respective regulation, authorize you to accord freely with a generator or autogen private, the purchase of electric power for their supply.

12 spread rate: document issued by the ARCONEL, which contains the structure of the tariff applies to consumers or users fi nal, and values that corresponds to such a structure, the public electricity service and the general public lighting service.

13. electric power public service: includes activities of: generation, transmission, distribution and marketing, general lighting, import and export of electricity.

14. system national interconnected (SNI): is the system integrated by them elements of the system electric connected between itself, which allows the production and transfer of energy electric between centers of generation, centres of consumption and nodes of interconnection international, directed to the provision of the service public of energy electric, not includes the distribution of electricity.

15. suspension of service: is the electric company's ability to interrupt the provision of the public service of electricity to the consumer or user fi nal, due to lack of payment of consumption billed, by force majeure or fortuitous; or due to scheduled maintenance.

16 enabling title: administrative act by which the State, delegated or authorizes a legal person, public or private, consortiums or associations, to carry out activities related to the public service of electricity.

Article 4.-rights of them consumers or users fi nal-are rights of them consumers or users fi nal them following: 1. receive the service public of energy electric according them principles constitutional of efi science, responsibility, continuity, quality and price equitable;

2. receive the invoice according to consumption;

3 claim to the electric company in case of disagreement with the public service received or invoiced values; and receive a timely response;

4 be opportunely informed by any suitable means of works or actions that could lead to a suspension of electric service;

5. be timely informed about rates applies to their consumption;

6 be treated equitable, non-discriminatory, or abusive, in the provision of the public service of electricity;

7 having street lighting on public roads, according to the regulation that for this purpose issue the Agency for the regulation and Control of electricity ARCONEL;

8 participate in public hearings convened by the Ministry of electricity and renewable energy or the Agency for the regulation and Control of electricity ARCONEL; and, 9. Be compensated for damage caused for reasons attributable to the quality of the public service of electricity provided by the power company's distribution and marketing.

Article 5-Obligations of consumers or end users-are obligations of consumers or users fi nal as follows: 1. timely pay the invoice of electricity;

2 allow access to authorized personnel of the power company and agencies to check car systems of measurement and their facilities;

3 use of forms effi cient power;

4 take care of electrical installations that allow you to have electricity and denounce those who make improper use of them;

5 avoid any risk that may affect your health and your life as well as that of others; and, 6. Comply with the conditions laid down by the electric company, based in law, rules and regulations regarding the use of electric power and the provision of the public service.

Article 6.-Standards complementary-are applicable in the electric field the laws governing third supplement - registration offi cial No. 418 - Friday 16 January 2015 - 7 the use and exploitation of natural resources, citizen participation, the protection of the environment and of the Ecuadorian positive law applicable to the electricity sector, which is not expressly regulated by this law.

Title II responsibilities and powers of the State article 7-duty of the State-is duty and responsibility custodial State, through the Central Government, the needs of the public service of electricity and street lighting, general in the country, through the use of effi cient of its resources, in accordance with the National Development Plan, the Master Plan for electricity, and other sectoral plans that may be applicable.

The provision of the public service of electric power and general lighting, will be conducted by the Central Government, through public enterprises or ventures which have majority shareholder, may exceptionally delegate to private initiative; still, in all cases, required the corresponding enabling title prefetching.

It corresponds to the Central Government decisions around planning planning, construction and installation of electrical systems to deliver energy users fi nal, as well as maintenance, operation and sustainable development of the power sector, to fi n satisfy the needs of the public service of electricity.


Article 8.-Rectory of public policies for the electricity sector.-corresponds to the Executive function formulation, defi nition and management of public policies and public services that guarantee the rights recognized by the Constitution, to the participants and consumers or end users.

For this purpose, the Executive function will act through the Ministry of electricity and renewable energy, and other agencies that are determined by this law.

Title III structure of the SECTOR electric chapter I structure article 9.-structure institutional-the sector electric will be structured in the area institutional, of the following way: 1. Ministry of electricity and energy renewable, MEER;

2. Agency of regulation and Control of electricity, ARCONEL;

3. national operator of electricity, CENACE; and, 4. Specialized institutes.

(Article 10.-structure business.-the sector electric, in the field business, will act through: to) companies public;

(b) mixed-economy enterprises;

(c) private companies;

d) consortia or associations;

(e) popular and solidary economy businesses.

Chapter II Ministry of electricity and renewable energy - MEER article 11.-legal nature-is the governing body and planner of the electricity sector. Is defi ne and implement policies; assessing the regulation and control are met to structure an effi cient public service of electrical energy; the identifi cation and tracking of the implementation of projects; grant enabling titles; evaluate the management of the electricity sector; the promotion and implementation of plans and programmes for renewable energy; mechanisms to achieve effi ciency energy, in accordance with the provisions of the Constitution and the law.

Article 12.-powers and duties-are powers and duties of the Ministry of electricity and energy renewable in matter electric, energy renewable and efi science energy: 1. exercise the representation of the State before agencies national e international and, remember them guidelines for its harmonization normative;

2 dictate policies and managing the processes for its application;

3 develop the Master Plan of electricity (PME), the National Plan for energy effi (plan);

4. monitor and evaluate the implementation of policies, plans, programmes and projects for the development and management within the scope of its competence;

5 propose to the President of the Republic draft legislation and regulations;

6. set parameters and indicators for monitoring and evaluation of management entities and companies in the sector within its competence;

8 third supplement - registration offi cial No. 418 - Friday 16 January 7 by 2015. Set the policy of import and export of energy electric;

8. promote Regional electrical integration;

9. promote scientific research and technology in the field of electricity, renewable energy and efficient energy;

10 establish the human resources training policies in the Electricity Sector;

11 grant and extinguish enabling titles to the exercise of the activities of the electricity sector;

12 Chair through the Minister or his delegate, the directory of the Agency for the regulation and Control of electricity ARCONEL and coordinate control of the management of that entity;

13 declared of public utility or social interest, according to the law, with fi nes of expropriation and immediate occupancy, the properties that are required for the development of the sector; constitute easements forced and necessary for the construction and operation of works related, in the scope of its powers;

14 organise the aforementioned dependencies that are considered necessary for the fulfilment of its function;

15 keep up-to-date inventory of energy resources in the country with electricity production purposes;

16 approve the annual operating budget and investments of the national electricity operator, CENACE;

17 to approve the annual report of the Executive Director of the national electricity operator, CENACE; and, 18. Others set out in laws and executive decrees, as well as in the General regulations to this law.

Article 13.-Planning planning.-the Ministry of electricity and renewable energy will be responsible for the planning of the electricity sector, renewable energy and the energy effi, consistent with the provisions of the Constitution of the Republic, the National Development Plan and the national policy issued by the President of the Republic, considering the following instruments , which will be mandatory for the indicative and public sector for the private sector: 1. the Master Plan for electricity, PME, shall be prepared by the Ministry of electricity and renewable energy, in coordination with institutions and companies in the electricity sector.

2. the National Plan of effi ciency energy plan, shall be drawn up by the Ministry of electricity and renewable energy, in coordination with the Secretaries of State and institutions whose functions are related to the use of energy.

The mechanisms of coordination of the instruments, in it related with the sector electric, will be defi nests by the Ministry of electricity and energy renewable.

Chapter III Agency of regulation and CONTROL of electricity - Is the technical administrative body responsible for the exercise of the power to regulate and control activities related to the public power and the general public lighting service service, State ARCONEL article 14.-legal nature-the Agency for the regulation and Control of electricity ARCONEL, preserving the interests of the consumer or user fi nal.

The Agency of regulation and Control of electricity is an institution of public law, with legal personality, administrative, technical, economic autonomy and its own patrimony; It is attached to the Ministry of electricity and renewable energy.

The budget of the Agency for the regulation and Control of electricity, ARCONEL, is fi nanciara with resources coming from the General State budget.

The Agency of regulation and Control of electricity ARCONEL not exercise activities business in the sector electric.

Article 15-powers and duties-the powers and duties of the Agency of regulation and Control of electricity ARCONEL are: 1. Regular aspects economic and operating of them activities related with the service public of energy electric and the service of lighting public general;

2. dictate the regulations to which must adjust is the companies electric; the operator national of electricity (CENACE) and the consumers or users fi nal; are these public or private, noting the political of efi science energy, for which are obliged to provide the information that you is required;

3. check the electrical companies, in relation to the compliance with the rules and obligations in the relevant enabling titles, and other aspects that the Ministry of electricity and renewable energy define;

4. coordinate with the national environmental authority mechanisms for enforcement to comply with third supplement - registration offi cial No. 418 - Friday 16 January 2015 - 9 legal regulations, by electrical companies, related to the protection of the environment and the environmental partner obligations, determined in qualifying titles;

5 perform studies and analysis technical, economic and fi nancial measures for the elaboration of regulations, tariff sheets and control actions;

6. set the tariff sheets for the public service of electricity and for general lighting service;

7 set by resolution of the Board and upon request duly sustained of utilities distribution, special contributions for improvement to consumers or users fi nal of the service in a given area geographic, works related to the systems of electrical distribution and lighting in that area, not contained in the Master Plan for electricity and to benefit one hundred such consumers or end of service users. For effect, the utilities that run the works shall establish areas of infl uence of the work, being property owners in these areas required to pay the special contribution.

The value of the executed works will be divided pro rata among the owners of properties located in the area of influence of the work and will be charged on the invoices or returns of electric service up to 60 months;

8. prepare reports and studies that are required by the governing body;

9 implement, operate and maintain the unique system of statistical information of the electricity sector;

10 exercise, in accordance with the law, the coactive jurisdiction in all cases within its competence;

11 process, investigate and resolve complaints and disputes which arise between the participants in the electricity sector, within the scope of their competence, in accordance with the regulation that is issued, for the purpose whose resolutions will be binding and mandatory;

12 know, deal with and resolve breaches and impose sanctions for violations of this Act, its regulations, enabling titles and other applicable regulations in the field of electric power;

13 submitted to the Ministry of electricity and renewable energy, within the first quarter of each year, a report of the immediately preceding year;


14 receive, the national environmental authority and make follow-up to allegations that proceedings on non-compliance with environmental standards and prevention of pollution;

15 encourage, promote and empower all stakeholders in the electricity sector on the activities of prevention and control of pollution, as well as processes for the mitigation of environmental impacts;

16 impose the sanction of suspension or establish the involvement of entities under their jurisdiction; and, 17. Exercise the other powers that set this Act and its general regulation.

Article 16.-Directory-the Agency for the regulation and Control of electricity ARCONEL will have a Board consisting of three members: 1. the Minister of electricity and renewable energy or its permanent delegate, who shall exercise the Presidency of the Board of Directors;

2. the Secretary national of planning planning and development or her delegate permanent; and, 3. A professional permanent delegate of the President of the Republic, with knowledge and professional experience of at least five (5) years in the electricity sector, with their respective alternate, who shall comply with the same requirements and will act only in case of absence of the owner.

Them members of the directory of the Agency of regulation and Control of electricity ARCONEL are subject to all the incompatibilities fi xed by law to them servers public, except it planned in the law organic of companies public. You won't have a relationship of dependency with the entity. Delegates who are not servers public, shall have the right to receive a diet, amount and conditions will be fi xed by the directory of the Agency for the regulation and Control of electricity ARCONEL.

The Executive Director shall act as Secretary of the Board of Directors, with the right to speak but without voting.

The Quorum of meetings of the Board shall be constituted with the presence of two members, of which one of them shall be the Chairman of the Board.

The directory will act through resolutions motivated and adopted by majority.

Article 17.-Powers and duties of the directory.-corresponds to the directory of the Agency for the regulation and Control of electricity ARCONEL: 1. approve the tariff sheets for the public service of electricity and for general lighting service;

10 third supplement - registration offi cial No. 418 - Friday 16 of January of 2015 2. Issuing regulations for the operation and development of the electricity sector;

3. propose to the Ministry of electricity and renewable energy regulations or regulatory reform projects related to the electricity sector;

4 dictate the rules of organization and functioning of the Agency for the regulation and Control of electricity ARCONEL, which will determine the competences of regional agencies which will create, in the framework of the powers contained in this law;

5. approve the annual budget of the Agency for the regulation and Control of electricity ARCONEL;

6 approve the annual report of activities of the Agency for the regulation and Control of electricity;

7. appoint to the Director Executive, of a terna proposed by the President of the directory;

8 meet and resolve all the issues that get to your consideration with regard to the powers and duties of the Agency for regulation and Control, ARCONEL, of the public service of electric power and general public lighting service; and, 9. The other functions assigned to this Act and its general regulation.

Article 18.-the Executive Director be appointed Executive Director will require: 1. be Ecuadorian;

2 possess professional title duly recognized and fourth academic level;

3 having professional experience of at least ten (10) years in the electricity sector; and, 4. Others established in the regulations of this law.

Article 19.-Powers and duties of the Director Executive-are powers and duties of the Executive Director: 1. exercise the legal, judicial and extra-judicial representation of the Agency for the regulation and Control of electricity ARCONEL;

2 Act on the sessions of the Board as Secretary, with the right to speak but without voting;

3 perform administrative acts and sign contracts that are necessary, in accordance with the powers and duties assigned to the Agency for the regulation and Control of electricity, ARCONEL and by the Board of Directors;

4. run the activities related to the powers of regulation and control in the sphere of its competence;

5 submit annually to the directory a technical and economic report on the management of the Agency for the regulation and Control of electricity ARCONEL;

6 present the annual budget of the Agency for the regulation and Control of electricity ARCONEL, for knowledge and approval of the Board; and, 7. Others attributed in regulations that apply.

Chapter IV operator national electricity - CENACE article 20.-legal nature-the national electricity operator, CENACE, constitutes a strategic technical body attached to the Ministry of electricity and renewable energy. It will act as technical operator of the interconnected national system (S.N.I.) and commercial transactions of energy blocks administrator, responsible for the continuous supply of electric power at the minimum possible cost, while preserving the efi global science in the sector.

He operator national of electricity, CENACE in the fulfillment of their functions must safeguard them conditions of security and quality of operation of the system national interconnected (Dec), holding is to them regulations that issued the Agency of regulation and Control of electricity ARCONEL.

Is an institution of right public with personality legal, of character eminently technical, with heritage own, autonomy operational, administrative, economic and technical, is fi nanciara through the budget General of the State and of the contributions of the companies participating of the sector electric.

The operator national of electricity, CENACE not exercise activities business in the sector electric.

Article 21.-Powers and duties-powers and duties of the national operator of electricity, CENACE: 1. carry out planning of short, medium and long terms for the supply of electric power at the minimum possible cost, optimizing transactions of electricity at national and international levels;

2 order the dispatch of generation at the minimum possible cost;

3 coordinate the operation in real time of the S.N.I., considering conditions of safety, quality and economy;

Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 11 4. Manage and liquidate commercial transactions in the electricity sector in the wholesale field;

5 manage technical and commercially international transactions of electricity on behalf of participants in the electricity sector;

6 coordinate planning planning and implementation of maintenance of generation and transmission;

7, within the scope of their powers, comply with the regulations issued by the Agency for the regulation and Control of electricity ARCONEL;

8. supervise and coordinate the supply and use of fuel for the generation of the electricity sector; and, 9. Exercise other powers and duties established by the governing body, this law, its general regulations and other applicable regulations.

Article 22.-the Executive Director's Executive Director will be appointed by the Ministry of electricity and renewable energy. To be appointed Chief Executive will be required: 1. be Ecuadorian;

2 possess a professional degree in electrical engineering, duly recognized and fourth academic level;

3 having professional experience of at least ten (10) years in the electricity sector; and, 4. Others established in the regulations of this law.

Article 23.-Powers and duties of the Director Executive.-corresponds to the Executive Director: 1. exercise the legal, judicial and extra-judicial representation of the national operator of electricity, CENACE;

2. run the activities related to the powers of administration and operation of the electric system, within the framework of its competence;

3. set the aliquots annual of the companies participating of the sector electric for the operation of the operator national of electricity, CENACE, with base in the regulation respective;

4. issuing them acts administrative and subscribe them contracts that are necessary, of conformity with the powers and duties assigned to the operator national of electricity, CENACE;

5. run the activities related with the powers of administration and operation of the system electric, in the frame of its competition;

6. present within the first quarter of the year to the Ministry of electricity and energy renewable a report technical and economic on the management carried out, corresponding to the year immediate previous;

7. submit for approval from the Ministry of electricity and energy renewable the budget annual operating and of investments;

8. know and solve all them themes that is put to its consideration, with regard to the powers and duties of the operator national of electricity, CENACE;

9 to issue the necessary regulations for the Organization and internal functioning; and, 10. Others attributed in the corresponding legislation.

Chapter V business participation


Article 24.-of the companies public and mixed-state, through the Ministry of electricity and renewable energy, may authorize public companies, created under cover of the organic law of public companies the activities of generation, transmission, distribution and marketing, import and export of electric power and general lighting service. For the performance of these activities public enterprises may hold all acts or contracts for procurement of goods, performance of works or provision of services deemed necessary.

The State, through the Ministry of electricity and renewable energy, may authorize joint ventures in which the State has majority shareholding, activities of generation, transmission, distribution and marketing, import and export of electrical energy, and service of general lighting, in the terms provided for in this law. Its management shall be limited to the implementation and development of projects and activities that do not can be carried out by public companies, as determined by the Ministry of electricity and renewable energy.

The State, through the Ministry of electricity and renewable energy, may authorize the activities of generation, transmission, distribution and marketing, import and export of electrical energy, and service of general lighting between State-owned enterprises of the States of the international community.

Article 25.-private companies and popular solidarity-economy the State, through the Ministry of electricity and renewable energy, may delegate, by way of exception, private capital firms, as well as popular and solidary economy companies, participation in the activities of the electricity sector, in any of the following cases: 12 - third supplement - registration offi cial No. 418 - Friday 16 of January of 2015 1. When is necessary to satisfy the interest public, collective or general;

2. when may the demand for the service not be covered by enterprises, public or mixed; or, 3. In the case of projects that use non-conventional renewable energy not contained in the Master Plan of electricity;

The first two cases, the delegation of the projects, that should be included in the PME, shall be carried out through a public selection process, conducted by the Ministry of electricity and renewable energy, which allows to choose the company that will develop the project in the best conditions to national interests.

For the third case, the Ministry of electricity and renewable energy may delegate its development, prior compliance with the requirements established in the relevant regulations.

Projects that use renewable energy sources, will have access to an incentive scheme which is determined in the respective legal regulations.

The companies private or popular and solidary economy mentioned in this article shall be established in Ecuador, in accordance with the relevant regulations.

Is except of them processes public of selection, mentioned in this chapter, the granting of concessions, that according to this article, perform the State by intermediate of the Ministry of electricity and energy renewable, with regard to projects that provides, through delegation to companies State foreign or subsidiaries of these, companies of economy mixed or to consortiums in that these companies State have participation majority.

In any case, concession contracts, subject to the observance of norms of the Constitution, this law, its general regulation and prior to its direct grant agreements.

Title IV management of supplies energy and energy renewable not conventional article 26.-energy non-conventional renewable.-the Ministry of electricity and renewable energy will promote the use of clean technologies and alternative energy sources, in accordance with stated in the Constitution, which aims to develop a sustainable electric system, based on the use of renewable resources of energy.

Electricity produced with this kind of energy will be preferential conditions laid down by regulation issued by the ARCONEL.

Title V provision of the service public power electric chapter I titles enabling article 27.-Authority's grantor.-the Ministry of electricity and renewable energy, will be responsible for processing and issuing the following enabling titles: 1. authorization of operation; and, 2. Concession contract.

In the case of mixed, private, popular and solidary economy businesses, SOEs foreign or subsidiaries of these, or consortia in which these State-owned enterprises have majority participation, deadlines for duration of the qualifying titles shall be determined based on an analysis of fi nancial, allowing first amortization of investments to be held and to obtain a reasonable utility; and, in second place, the importance of the contribution technical, economic and social to the development national.

For the case of the autogeneradores, the term of the title enabling will be established considering the lives useful of them different types of technologies excluding is the principle of utility reasonable. The autogen who decides to manage the obtaining of an enabling title, should be considered within the fi nancial analysis, that the coverage of your investment and costs of operation and maintenance, will be fi nanciados through the business of self-generation.

Article 28.-Authorization of operation.-the Ministry of electricity and renewable energy will process and issue the respective authorization for operation for execution, operation and performance of projects developed by public and mixed enterprises.

In the case of joint enterprises, the authorization of operation shall be regarded as delegation granted by the State, in accordance with article 316 of the Constitution of the Republic of Ecuador.

Them requirements and procedures for the granting of the authorization of operation after its approval, as well as them rights and obligations of the grantor and dealers, will be established in the present law and its regulation general and them titles enabling respective.

Article 29.-Contract award.-the Ministry of electricity and renewable energy will sign contracts of concession with private companies and popular and solidary economy, whose projects have been included in the PME, or those who to not recorded in the PME, have been proposed by companies concerned, observing the regulations issued for the effect.

Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 13 requirements and procedures for the granting of the concession contract after approval, as well as the rights and obligations of the grantor and dealers, will be established in this Act and its rules of general application and the respective qualifying titles.

Article 30.-Authorization for the use of renewable and non-conventional energy resources.-the promotion of non-conventional renewable energy, as well as the use of renewable energy resources, must have prior authorization for the exploitation of those resources by the national environmental authority, and must be stored in adherence to the provisions of the governing body of the national planning.

Article 31.-Registration of titles enabling.-the registration national titles enabling, same that will be in charge of the Ministry of electricity and renewable energy, must contain all the information related to operating authorizations and contracts of concession in the electricity sector. It will be responsibility of the utilities, at their own expense, register enabling title in accordance with what is available for the effect in the general regulations of this law.

The registry will be public and will be available for the knowledge of stakeholders.

Article 32.-Application and procedures for the granting of operating authorizations and contracts award applications for authorization of operation or a concession contract for projects not contained in the PME, shall be submitted to the Ministry of electricity and renewable energy so that, after analysis and respective studies, resolved on granting the qualifying titles.

Article 33.-Termination of the term of the contract of concession-fi NISH the term of the concession contract awarded, all assets pertaining to the public service must be reversed and compulsorily transferred to the Ecuadorian State free of charge. If there is no interest in facilities, these must be withdrawn by dealer at your cost.

In the case of concessions for hydroelectric generation, all assets pertaining to the public service will be compulsorily transferred to the Ecuadorian State, no cost and no exceptions.

Notice not less than 18 months to fi end time of the period provided for in the concession contract, the Ministry of electricity and renewable energy will establish actions and measures to be taken to completion.

Article 34.-Termination of the contract of concession-the Ministry of electricity and renewable energy may terminate the contract of concession in the following cases: 1. implementation of the object of the concession contract;

2. at the expiration of the term of the concession contract;

3. by mutual agreement of the parties, duly motivated and that does not affect to the interest of the State;

4. for revocation;

5. by termination;


6. by waiver of the owner, without prejudice to the responsibilities that correspond to him;

7. by the bankruptcy of the holder of the concession; and, 8. By other grounds established in the respective contract of concession.

Termination extinguished the rights of the licensee, and will produce its effects from the date of its notifi cation. The application procedure will be established in the general regulations to this law.

In the case of termination of the concession contract based on the numbers 4, 5, 6 and 7 of this article, the concessionaire is obliged to hand over immediately to the State all rights, equipment, machinery and other elements pertaining to the public service, without cost to the State, and in addition, will lose automatically guarantees and warranties rendered according to the law its general regulations and other instruments, which will be in favor of the State.

The State shall have the power to instruct the dealer clearance, at cost of the same, of goods which they believe are not suitable for the activity.

However the effects specified in the preceding paragraphs, in the case of termination based on any of the paragraphs of this article, will remain the responsibility of the former owner, for environmental damage involving also the obligation of restoring ecosystems and compensation to individuals and communities, if pay.

In the contract of concession must establish is the treatment that is will give to them goods affected to the service public to them cases of termination that not is are designated in the present law and its regulation general.

Article 35.-Expiry of the concession contract Causales-without prejudice to the grounds for revocation laid down in the general regulation of this law and the concession contract, the Ministry of electricity and renewable energy may declare the expiration of the concession agreements, in the following cases: 1. do not enter commercial operation as provided for in the enabling title or if , once started, suspendiere it for a period exceeding sixty days without cause that the proof that, except for force majeure or unforeseeable circumstances, duly proved to the Ministry of electricity and renewable energy.

14-third supplement-registration offi cial No. 418-Friday 16 of January of 2015 2. Do not restart, within a maximum period of sixty days, operations after missing the causes which gave rise to the suspension.

3 engage in falsehoods in bad faith or malicious statements or reports on technical or economic data.

4. do not make investment stipulated in the concession contract.

5 have used fraud or illegal means, at the signing of the concession agreement.

6. transfer rights or celebrate contracts or agreements private for the assignment of one or more than their rights, without the authorization of the Ministry of electricity and energy renewable.

7 make the transfer of shares, participations, certifi Cates of contribution or other titles that imply a change in the partners of a private company or the popular solidarity, economy without authorization from the Ministry of electricity and renewable energy.

8. for operating without authorization.

9. install plants generation or self-generation; as well as import or export power, without the corresponding concession agreement.

10. by administrative sanctions resolutions issued by the national environmental authority concerning environmental offences, without prejudice to the obligation of the holder of the corresponding remediation.

11 by default injustifi ED for more than thirty days from the dealer in the execution of the project or operation.

12. when fines exceed the value equal to the warranty of fi compliance obligations or term.

13. attack against the stability technical, economic and fi nancial of the sector electric.

The expiration extinguished them rights of the dealer, and will produce its effects from the date of its notifi cation.

Article 36.-Expiry of the contract award.-the Ministry of electricity and renewable energy in the exercise of its jurisdiction may declare the forfeiture of the concession contract, where owners have incurred in the grounds for revocation laid down in article 35, in this chapter, and further provisions of this law, its general regulations and the concession contract.

In all proceedings for a declaration of revocation shall ensure the right to due process which includes the basic guarantees enshrined in article 76 of the Constitution of the Republic of Ecuador. The Declaration of revocation process can start offi cio by the Ministry of electricity and renewable energy, by a third party complaint properly grounded and investigated by the Ministry of electricity and renewable energy or at the request of other ministries that have relationship with the electricity sector. The administrative procedure shall be subject to the provisions of this Act and its general regulation.

Technical report on the foundations in fact will serve as support for the Declaration of expiration and will be formulated by the Agency for the regulation and Control of electricity ARCONEL.

The Ministry of electricity and renewable energy will be transfer to the holder with the technical agency for the regulation and Control of electricity ARCONEL report, to at the end of 45 days, accrediting compliance with its obligations or present their disclaimers and the evidence supporting his defense.

If the Ministry of electricity and renewable energy finds no basis to continue with the process of aging or the causal has been disproven by the concessionaire in that term, we will declare it concluded and have the record file. If instead, there is compliance, by duly motivated administrative resolution, outstanding obligations will order the dealer to remedy the non-compliance in 60 days, without prejudice to the payment of interest and penalties for failure to comply with time. The Ministry of electricity and renewable energy may request the motivated statement by other State entities within the Declaration of revocation process.

If the dealer not remedied within the period the breach within the prescribed period, the Ministry of electricity and renewable energy declared invalid reasoned ruling on the expiry of the concession contract. The dealer may bring the actions and administrative and judicial remedies provided in Ecuadorian legislation.

Initiated an administrative procedure for declaration of revocation, the concessionaire may not waive the concession.

Article 37.-Disputes arising from the contract of concession-the resolution of differences or disputes that is subject of the concession contract only may submit to the judges of the judicial function of the Ecuador or an instance of regional arbitration. In any case it will be as provided in article 422 of the Constitution of the Republic of Ecuador.

Article 38.-Assets pertaining to the public service of electricity.-within the period of validity of the enabling titles, strategic and public electricity service providers not may withdraw the equipment or facilities that are essential to run this activity without authorization from the Ministry of electricity and renewable energy.

Third supplement - registration offi cial No. 418 - Friday 16 January 2015 - 15 chapter II regime of operation of the SECTOR article 39.-participants-the electricity sector will be constituted by legal persons engaged in activities of generation, self-generation, transmission, distribution and marketing, general lighting, import and export of electricity, as well as also the natural or legal persons that are considered consumers or users fi nal.

Article 40.-Generation the activity of electricity generation will be made by public companies, mixed-economy companies; and by other legal entities private and popular and solidary economy, duly empowered by the awarding authority to pursue such activity.

Its operations are subject to provisions of their respective enabling title, as well as constitutional, legal and regulatory standards and regulatory established, under his sole responsibility, and observing the principles of transparency, effi ciency, continuity and quality.

The development of new generation projects, will be based on sectoral policies laid down in the sectoral plans and National Development Plan.

Article 41.-the self-generation.-the activity of self-generation of electricity and their surpluses, will be treated in accordance with regulation that dictates the ARCONEL for the effect.

It is considered as part of the activity of self generation, cogeneration processes intended for the production of electrical energy.

Self-generation oil and mining self-generation, located in unincorporated at the S.N.I. systems, will be based and shall be controlled in accordance with his enabling titles petroleum or mining, as the case may be. In the electric field, and while they remain in their condition not incorporated into the S.N.I., check the information that require the Ministry of electricity and renewable energy or the ARCONEL, exclusively for purposes of planning, statistics and information, as set out in the corresponding regulation.

Article 42.-Transmission-transmission of electricity nationwide activity will be conducted by the State through the respective public company.


Its operation is subject to provisions of their respective enabling title, as well as constitutional, legal and regulatory standards and regulatory which are dispatched, under his sole responsibility, and observing the principles of transparency, effi ciency, continuity, quality and accessibility.

It shall be duty of the public company responsible for the transmission, expand the national transmission system, based on plans drawn up by the Ministry of electricity and renewable energy.

Through the recognition economic that is determined in them spreads tariff approved, the transmitter is forced to allow the free access of third to your system, in them terms that are established in the regulation corresponding.

He Ministry of electricity and energy renewable may authorize to companies mixed, and of way exceptional to companies private or of economy popular and solidarity, specialized in transmission electric, the construction and operation of the systems of transport of electricity that stating in the PME.

Subject as provided in this article, the Ministry of electricity and renewable energy may authorize a generator, autogen, Distributor, large consumer or user fi NISH to build a network of transmission, its exclusive cost, to meet their own needs.

Article 43.-distribution and marketing-distribution and marketing of electricity activity will be conducted by the State through legal persons duly empowered by the awarding authority to pursue such activity. Its operations are subject to provisions of their respective enabling title, as well as constitutional, legal and regulatory standards and regulatory established, under his sole responsibility, and observing the principles of transparency, effi ciency, continuity, quality and accessibility.

Will be obligation of each company dedicated to the activity of distribution and marketing, expand your system depending on them guidelines for it planning cation that issue the Ministry of electricity and energy renewable, to meet, in them terms of its title enabling, all demand of service of electricity that you is required, within an area geographic ca exclusive that will be fi jada in that same document which shall also include the obligation to meet the quality levels that are pared to the service, according to relevant regulation.

The electric company will provide electric power to natural or legal persons showing the requirements established in the regulation that the ARCONEL for the effect.

So the electric company can provide the electrical power supply, you must subscribe with the consumer or end user the respective contract of supply of electricity, whose stipulations, conditions and other applicable rules, them shall be established through the respective regulation.

The marketing division includes the purchase of blocks of power to sell to consumers or users fi nal; and all the commercial management associated with 16 - third supplement - registration offi cial No. 418 - Friday, January 16, 2015 these transactions of buying and selling, being among others the installation of systems of measurement, reading, billing and collection of consumption.

Electrical distribution and commercialization companies have coercive jurisdiction to collect the debts related to the provision of the public service of electric power and general lighting service.

Article 44.-of them large consumers-them big consumers will be those people legal, duly Qualifi ed as such by the body competent, whose features of consumption you authorize to act through contracts bilateral.

The characteristics of consumption will be defi ned through the respective regulation.

Article 45.-interconnections international-international electricity interconnections will be allowed according to the availability and needs of the electricity sector and shall be subject to the Constitution of the Republic of Ecuador, the treaties and international instruments and regulations handed down for effect.

The Ministry of electricity and energy renewable will be the responsible of defi nir them political in matter of interconnections international.

You shall be responsible to the ARCONEL coordinate actions regulatory that correspond with the regulatory agencies of the countries involved.

The national electricity, CENACE operator will coordinate the operation of electrical interconnections with neighbouring countries and shall apply the rules in the field of international energy transactions.

Article 46.-Blocks of energy-power blocks transactions transactions may be held only by purchases and sales of energy through contracts signed by the participants. They cleared commercially by the national operator of electricity, CENACE, based on prices agreed in the contracts.

Commercial closure of commercial transactions through contracts, settlements of transactions in the short term may be made.

International electricity transactions, shall be settled by the national operator of electricity, CENACE, based on trade agreements with other countries.

The scope and conditions of contracts for purchase and sale of energy, as well as short-term transactions, will be established by regulation which issued the ARCONEL for the effect.

Article 47.-programming of operation.-the national electricity operator, CENACE will perform the operation of long, medium and short term scheduling, to achieve the lowest operating cost for the country whereas the technical constraints.

The participants performing generation, self-generation, transmission, distribution and marketing, and large consumers, in addition to the international electricity transactions enabled, will be required to provide the national operator of electricity, CENACE, all economic, technical and operational information that should be used for programming.

Article 48.-the economic dispatch-the national operator of electricity, CENACE held the economic dispatch of units and power plants, on the basis of the programming of the operation referred to in the immediately preceding article, with the purpose of obtaining minimum time possible electricity cost, whereas the variable costs of production, which must be declared by each generator and audited by the operator , in accordance with the respective legislation.

Article 49.-commercial liquidation.-purchases and sales of electrical energy that are made between participants in the electricity sector through contracts, as well as short-term transactions, shall be settled by the national operator of electricity, CENACE, within the scope of their competence, based on regulation issued for this purpose by the ARCONEL.

National electricity, CENACE operator will determine the values that shall pay and receive each participant. Similarly, it will liquidate the values appropriate for the transmission of electricity and the international transactions of electricity service.

Article 50.-Regulated contracts-legal persons dedicated to the activity of generation have an obligation to sign contracts regulated with legal persons engaged in the marketing and distribution, proportionally to their regulated demand.

The mixed, private or generators of popular solidarity economy, when they contracted with utilities dedicated to the activity of distribution and commercialization, should do so in regulated contracts, in accordance with regulation specifi ca issued by the ARCONEL, can also engage with large consumers through bilateral contracts.

If the activities of generation, transmission, distribution, and/or marketing focus on a public company, the costs of transfer between the activities of generation, transmission, distribution and/or marketing must register whereas the same principles of regulated contracts, and are subject to the regulation that emits the ARCONEL for the effect.

Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 17 for the generation of property of the distributor company and soaked in their own network, power and energy production will be delivered in proportion to the demand of the companies distributors, to maintain the single tariff at the national level.

Article 51.-Short term-transactions shall be regarded as transactions of short term which can be originated by the difference between the amounts of energy employed and the actually consumed or produced, or services associated with the generation or transmission of electric energy.

Energy will be valued with the economic cost obtained from actual generation dispatch at the end of every hour, called schedule cost of energy, in which incremental transmission losses shall not be considered and will be unique for all bars of the electrical system.

The determination of the energy that is lost in the transmission stage, as well as its economic assessment, and the remuneration that corresponds by transmission services, will be defi ned by the ARCONEL using the corresponding regulation.


Article 52.-process selection public.-construction, operation and maintenance of priority projects, according to the order of execution planned in the PME, which could be concessioned to private companies or people and solidarity, the Ministry of electricity and renewable energy economy be carried out public selection processes.

For each process, the energy requirement of the demand, which may be also unregulated demand, as well as conditions and price is determined.

The offeror that is selected in the public process, has the right to that to grant the respective enabling title, and for its part this bidder is obliged to sign the respective regulated contracts, based on the price submitted in the offer.

When the project is identifi ed by the private initiative and is not incorporated in the PME, agree to national interests, this can develop it, at your risk, prior express authorization from the Ministry of electricity and renewable energy, according to the terms stipulated in its enabling title and regulations issued for the purpose.

Article 53.-from planning and investment in the electricity sector-planning the PME, whose development will be in charge of the Ministry of electricity and renewable energy, with a ten year projection, identify face priority generation projects for the electricity sector.

The Plan identified face also programmes of expansion and improvement in generation, transmission, distribution and energizing of isolated rural areas.

The electricity Master Plan will ensure to increase the coverage of electric power in rural areas, isolated in a progressive manner.

The Ministry of electricity and renewable energy will select, of the referred Plan, those that will be developed by the State and which could be proposed to the private companies and people and solidarity, economy before the public selection process established in this law.

The investment required to implement projects of generation, transmission and distribution of the SME by the entities and public enterprises, will be charged to the General budget of the State or through own resources carried out.

Alternatively, for the funding of the projects, public enterprises hire credits with own warranties or the State.

The investments fi nanciadas by the State through the budget General, will be considered in the companies public as contribution heritage; and as contributions of capital in corporations, while they exist.

Chapter III regime tariff article 54.-prices subject to regulation. Rates-the ARCONEL, within the first half of each year, determine the costs of generation, transmission, distribution and marketing, and general lighting, which will be applied in power transactions, which will form the basis for the determination of the rates to the consumer or user fi nal for the subsequent year. In the cases expressly laid down in the relevant regulation, the rates approved for the year may be checked.

ARCONEL, prior the study corresponding, can fi jar rates that promote and encourage the development of industries Basic, whereas for the effect the use of energies renewable and friendly with the environment, to prices competitive and stable, or subsidies, of be necessary.

In addition, ARCONEL may establish rates to achieve effi cient energy use.

The adjustment, modifi cation and restructuring of the tariff sheet, will involve modifi cation automatic supply contracts of the public service of electricity including public service of general lighting.

Article 55-Tariff principles-the tariff sheets shall be drawn up by the ARCONEL, observing the principles of solidarity, equity, cost, effi ciency energy coverage, same that they must be developed in the respective regulation. The rate will be unique in all the 18 - third supplement - registration offi cial No. 418 - Friday, January 16, 2015 national territory according to consumption patterns and levels of stress. Additionally, it must be considered principles of social and environmental responsibility.

Exceptionally can fi x it rates differentiated consumers holding other than the flat fee rates to the date of issue of this law fi xed at the national level.

Investment contracts in the electricity sector which have been agreed with the Republic of Ecuador under the aegis of the provisions of article 25 of the organic code of production, will include a clause of price stability of purchase of the energy or, failing, scheduled reset them.

Article 56.-cost of the service public of power electric-the cost of the service public and strategic of energy electric will understand them costs linked to the stages of generation, of transmission, of distribution and marketing; and of the service of lighting public general, the same that will be determined by the ARCONEL.

The cost of generation corresponds to the value which will have to pay a consumer or user end of the power supply, to cover the costs of the activity of generation operated optimally.

For generation companies private or popular and solidary economy, costs must consider the remuneration of service assets, as well as the products by concept of management, operation and maintenance; and the costs associated with environmental responsibility.

For public and mixed enterprises of generation and transmission, costs must consider the products by concept of quality, reliability, availability, management, operation and maintenance; and the costs associated with environmental responsibility.

For generators of electrical energy in charge of public companies, 30% of the surplus that is obtained in the phase of operation will be earmarked for projects of territorial development in the area of influence of the project; whereas in the case of generators of private equity and mixed-economy, from the entry into force of this law, 3% of the profits will go to workers and the remaining 12 per cent will be earmarked for projects of territorial development in the area of influence of the project. In both cases, the criteria of allocation to projects of territorial development, as well as the allocation period, will be determined in the general rules of application to this law.

The costs of distribution and marketing, and general lighting will cover the value corresponding to the resulting products by concept of quality, confi ability, management, operation and maintenance, and the expansion of each system of the technical study prepared by the ARCONEL.

Article 57.-Tariff specifications.-ARCONEL, through its directory, approve tariff sheets, them that, for the information of the users of the system, must be informed through the media in the country and published in the registry offi cial.

Article 58.-Payment of services of entities and organizations of the public sector.-in case of delay in the fulfilment of obligations by the entities and organizations of the public sector by the consumption of electrical energy, electricity companies in exercise of coercive jurisdiction, can order to the Ministry of finance, the debit of the corresponding values with cargo transfers corresponding to such entities and agencies , and their direct transfer to electric utilities.

To this effect, electric companies will coordinate with the Ministry of finance, the procedures necessary to comply with this provision.

Article 59.-Subsidies-whether by circumstances of a social or economic nature State has granted or decided to grant compensation, subsidies or direct and targeted cuts in the public service of electricity, to a certain segment of the population, through laws or sectoral policies, or through ARCONEL, it approves or any approved tariff sheets that are placed below the costs of the public service of electricity the values that correspond to these subsidies, compensations or sales will be covered by the Ecuadorian State and obligatorily are indicated in the General State budget.

The Ministry of electricity and renewable energy will be responsible for reporting, the Ministry of finance, the amount of compensation, allowances or rebates indicated in the previous paragraph, applicable for the following year.

The Ministry of electricity and renewable energy will manage the timely delivery of the referred amounts to utilities that corresponds, fi n ensure economic stability and fi nancial sector. The Ministry of finance will cover monthly, with base in it information consolidated by the ARCONEL the values corresponding to them subsidies and rebates.

Low-consumption residential end users or consumers may be subsidized by other consumers or users residential end, in accordance with the regulation that emits the ARCONEL for the effect.

Article 60.-Billing to consumers or users fi nal-the invoice relating to the consumption of public service of electric power, consumers or end users, will include, solely and exclusively items corresponding to the services that provides the electric company, whose detail will consist in the regulation to issue the ARCONEL for the effect.


Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 19 article 61.-exceptions-except prices subject to regulation, the following transactions: 1. the transfer of electricity between generators of private capital with distributors, through regulated contracts;

2. the transfer of electricity between generators of private capital with large consumers, through bilateral contracts;

3. the transfers of the surplus of energy electrical between them autogeneradores with them distributors, through them contracts regulated;

4. transfers of surplus electric power between the and/or with large consumers, through bilateral contracts; and, 5. The transaction international of electricity.

Chapter IV regimes special article 62.-street lighting and traffic signals-the State, through public enterprises that perform the activity of distribution, will be responsible for the construction, operation and maintenance of general public lighting systems. In addition these companies will supply electric power to the lights, intended for public safety systems, intervened and ornamental street lighting.

Construction, operation and maintenance of the public intervened and ornamental lighting systems will be the responsibility of the autonomous governments in accordance with the COOTAD, or any entity responsible for the public space and traffic control, whose costs may be cofi nanciados by the distribution companies considering a standard lighting costs. By agreement between the autonomous governments and the distribution companies, maintenance of public lighting systems can be performed by these companies.

He ARCONEL will regulate them aspects technical, economic, tariff and of quality of the lighting public general for the provision of a service effi cient.

Corresponds to the consumer or user end of service of electrical energy, the payment by general lighting service, as well as consumption of electricity for street lighting system, intervened and ornamental street lighting.

The costs of investment, operation and maintenance, and energy consumption of the lighting system intended for the lighting of roads for vehicular and pedestrian movement of declared as horizontal property private spaces, shall be borne by the owners of such properties.

The costs of investment, operation and maintenance of general public lighting service, that determine characteristics different to those laid down in the regulations issued for this service, for special requirements shall be borne by the applicants. For this purpose they must have the authorization of the competent authority for the use of public space.

In the construction of new roads or expanding existing ones, in charge of the Ministry of transport and public works and the decentralized autonomous governments, these entities will be responsible for developing the technical studies and executing the works of street lighting general, ornamental or intervened on the basis of these studies.

Article 63.-Energizing Rural-State program will promote and fi nanciara, on a priority basis, the development projects the electrifi cation rural, especially in areas isolated from distribution systems. Values annual, necessary for the implementation of the same, will be managed by the Ministry of electricity and renewable energy at the Ministry of finance.

The program is fi nanciara with resources coming from the General State budget. However, you can also fi nanciarse with contributions or donations from public or private, national or foreign entities, and others to be determined in this or other laws, duly controlled by the Ministry of electricity and renewable energy.

So it is included in the PME, the Ministry of electricity and renewable energy will prepare in the first quarter of each year, program and energizing, whereby it prioritize less developed areas, favouring a harmonious progress of all regions of the country, for the following year.

The ARCONEL is responsible for issuing regulations for the identifi cation of rural power projects, and the supervision and control of the implementation of the programme.

Dealers will be in charge of the identifi cation, implementation, operation and maintenance of the works; as well as the fi scalizacion of the same.

Article 64.-Isolated systems and island-systems which, by special conditions, may not be connected to the S.N.I., be regarded as not incorporated; regulated customers of these systems may have different interconnected areas tariff charges, approved by ARCONEL. Subsidies that may result in these systems will be covered by the consumers or users fi nal of the S.N.I. or assumed by the State, according to the policies established by the Ministry of electricity and renewable energy.

Information related subjects technical, economic and fi nancial of these systems must be necessarily turned to the Ministry of electricity and renewable energy, the ARCONEL and the national electricity operator, CENACE.

20. third supplement - registration offi cial No. 418 - Friday, January 16, 2015 article 65.-Expansion power to residential areas and similar.-the installation of networks, transformation, generation of emergency and stations further necessary works to serve the electrical service in lotizaciones, residential areas, building of horizontal and similar property, will be the responsibility of the executors of these real estate projects.

Electricity grids to meet electric service in lotizaciones, urban development and building of horizontal property, must be underground.

In these cases for the provision of electrical power supply, the electricity company responsible for the activity of distribution and sale of electricity, will request the executors of the estate: title deed duly legalized and registered in the land registry; authorization issued by the Government autonomous decentralized corresponding on the approval of the real estate project; and previous verifi cation of the electric company that the project falls within the feasible areas considered in the respective technical document issued by the National Secretariat for risk management.

The ownership of these facilities and the transformation of the lotizaciones and developments stations will be the electric company.

The distribution companies remain properly identifi ed in their geographic databases cas, electrical and accounting, the active fi nanciados by individuals who receive.

ARCONEL shall not include the value of these assets for the tariff calculation, but only the replacement costs associated with them, avoiding at all time to the consumer or end user cancel twice by these works.

For this purpose ARCONEL shall issue respective regulations.

Chapter V regime of them infractions and sanctions article 66.-types of infractions and sanctions.-them violations to the law, to its regulation general, to them regulations, to them titles enabling, without prejudice of that produce expiration, is will sanctioned with a fine imposed by the ARCONEL, of 2 to 40 wages basic Unifi ed, SBU, of them workers of the sector private According to the importance or seriousness of the damage caused by the Act or omission constituent of the offence, in addition to compensation for the damages and repair of the damage actually caused.

Infringements will be: 1) minor offences.

(2) serious offences.

Article 67.-offences mild-are those that involve administrative issues that do not have greater involvement in the public service of electricity, being the following: are minor offences of the company: to) delays not proof specified in the delivery of the required information.

(b) non-compliance in the execution of the plans of expansion and improvement of operation, transmission, or distribution, always and when does not affect the security and reliability of systems confi.

(c) non-compliance on the timetable for implementation of the projects of generation, provided that do not affect the date of entry into commercial operation.

(d) partial breach of quality indices established by the ARCONEL.

In the event that the electric company incurs in any of the offences categorized as mild, sanction will correspond to 20 basic wages Unifi ed (SBU). Recidivism shall be punished with 30 SBU.

The above-mentioned infractions and their corresponding sanction, shall also apply for electricity, CENACE in whatever relevant national operator.

(Article 68.-violations serious.-are those that affect seriously the provision of the service public and strategic of energy electric: 1. of the company: to) to who band, resell or by any other Act legal fullfilling power and/or energy electric without authorization, except in them cases allowed expressly by this law.

(b) the breach in the execution of them plans of expansion of transmission and distribution, that affect the safety and confi ability of those systems.

(c) breach of them programs of maintenance that affects the security of the people, as well as the security and confi ability of them systems.

(d) failure to comply with repeated of the indexes of quality established by the ARCONEL.


(e) non-compliance in the program of reduction of energy losses.

(f) failure to comply with the provisions issued by the national operator of electricity, CENACE, that threaten the safety of the operation of the system.

Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 21 g) those that threaten the integrity, security and set technical and operational reliability of the electrical systems that provide the public service.

(h) submit inaccurate or distorted information.

(i) non-compliance with the obligations laid down in laws and regulations.

(j) non-compliance to the regulations and provisions issued by the ARCONEL.

(k) hinder or diffi hide the control that should make them servers of the Agency of regulation and Control.

2 are considered grave breaches of the consumer or end user: to) sell, resell, or by any other legal act dispose of power or electric power, except as expressly permitted by this law.

(b) limit or prevent, repeatedly, the fulfilment of the tasks of the ARCONEL specifi.

(c) consume electrical energy through installations that alter or prevent the normal functioning of the instruments of measurement or control of the supply of strategic and public service for electricity.

(d) consume energy power, without having signed the respective contract of supply of service of electricity.

(e) consume electrical energy in form or quantity that is not authorised by your electricity contract.

(f) not submit repeatedly, information in the form and terms established or granted by the competent authority.

(g) submit inaccurate or distorted information.

(h) breach the obligations laid down in laws and regulations.

(i) comply with the regulations and provisions issued by the ARCONEL.

3 are considered grave breaches of third parties: to) handle the electrical installations of public and strategic service of electric power without the authorization of the corresponding company.

In the event that the company electric incurred in any of them violations catalogued as serious, the sanction shall be to 30 SBU. Recidivism shall be punished with maximum fines established in this chapter, this is 40 SBU.

In the case of the consumer or end user, the penalty shall be up to 2 SBU, and recidivism shall be punished with up to 4 SBU.

For the case of third, the sanction shall correspond to 20 SBU. Recidivism shall be punished with 30 SBU, without prejudice to the civil and criminal actions that have place.

The above-mentioned infractions and their corresponding sanction, shall also apply for electricity, CENACE in whatever relevant national operator.

These violations do not exclude criminal actions and penalties to any place depending on the case.

Article 69.-Obligation of the user to the payment-application of sanctions does not release the offender from the obligation to pay the electric company energy consumed, more a charge by concept of compensation, calculated on the basis of the regulation issuing the ARCONEL, for every month or fraction. The company electric will be the liquidation corresponding and it will make of knowledge of the user fi nal, for effects of payment.

Article 70.-Unpaid consumed energy.-the determination of the calculation of the energy consumption not paid, will be made by the electric company, under the following parameters: 1. the date of occupation or lease of the apartment where has been consumed electric power;

2. where appropriate, the former Billings;

3. where necessary, the measurements made by a team control pattern; and, 4. In general, any other data or information that will help to determine with greater precision the unpaid consumption.

Article 71.-Suspension of services.-the electric company may suspend the supply electric power to the consumer or user fi nal, by any of the following cases: 1. due to lack of timely payment of consumption of electric power, the day after the maximum payment previously notify date each to the consumer or end user;

2. when found is consumption of electric power, through clandestine, direct or similar, installations that alter or prevent the normal functioning of the meter;

3. when the user rush fi nal does not comply with the technical conditions laid down for the purpose;

22. third supplement - registration offi cial No. 418 - Friday 16 of January of 2015 4. When to check the consumption of electrical energy in circumstances that alter the respective contract;

5 when the electric company notice, through appropriate media, inform promptly user fi nal who, for reasons of maintenance or repair, there will be a suspension of electric power;

6. when consumed electric power without have been held respective electricity supply contract;

7. where there are connections to the electric company's system without his authorization; and, 8. For reasons of force majeure or unforeseen circumstances.

The electric company will suspend electricity service, prior notifi cation to the consumer or user fi nal, which will include the reasons for the suspension, excepted from this obligation cases of force majeure or fortuitous case.

If there are outstanding debts it grants to the electric company, the coercive jurisdiction to be collected.

Article 72.-Exclusion of responsibility-the electric company shall have no liability for the suspension of the provision of strategic and public service of electric power, for reasons of force majeure or unforeseen circumstances duly verified by the ARCONEL.

Likewise, there will be responsibility of the power company by the suspension of the provision of the public service of electric power for the execution of works of maintenance, non-emergent scheduled repairs, expansion or modifi cation of its facilities, which must give prior notice to consumers or users fi nal through mass media, with a minimum of twenty-four hours prior to the start of the respective works.

Article 73.-Procedure penalties.-in the regulation issuing the ARCONEL, is established the procedure to impose appropriate sanctions.

Title VI efficiency energy article 74.-objectives-the energy effi will general aim to obtain a service or product with the lowest energy consumption. In particular, the following: 1. promote the efi science in the economy and in society in general, and in particular in the electric system;

2. promote values and behaviors oriented to the rational use of energy resources, giving priority to the use of renewable energy;

3 promote the rational use of electric energy by consumers or end users;

4 encourage the reduction of production costs through the use of energy efficient, to promote competitiveness;

5 reduce the consumption of fossil fuels;

6 Guide and advocate for the consumer or end user; and, 7. Reduce environmental impacts with the sustainable management of the energy system.

Article 75.-Establishment of effi ciency energy policies-policies and rules adopted by the Ministry of electricity and renewable energy, for the fulfilment of the objectives set out in this matter, will seek a greater effi science in the use of energy sources and the use of electricity by consumers or users fi nal.

These policies must be consistent with the National Development Plan.

Article 76.-Effi ciency energy promotion mechanism.-the State through the Ministry of electricity and renewable energy, will promote the efi energy science through incentives or punishments, which is defi niran in the general regulation of this law, and corresponding regulations.

Title VII liability environmental article 77.-Coordination-ARCONEL, within the scope of its competence, in coordination with the national environmental authority, will be in charge of the monitoring of compliance with the rules governing matter and which must be observed by the electricity companies.

Article 78.-Environmental protection.-corresponds to the electric companies, whether public, mixed, private or popular and solidary economy, and in general to all participants in the electricity sector in the activities of generation, self-generation, transmission, distribution and commercialization of electrical energy, compliance with policies, regulations and procedures applicable according to the categorization established by the national environmental authority for the prevention, control, mitigation, repair and monitoring of environmental impacts in the stages of construction, operation and removal.

Article 79-Environmental permitting-the companies that carry out activities within the electricity sector, are third supplement - registration offi cial No. 418 - Friday 16 January 2015 - 23 required to obtain and maintain previously environmental permits in accordance with the environmental categorization that establishes the national environmental authority.

Article 80.-Environmental impacts.-electric utilities will be required to prevent, mitigate, cure or compensate according to be the case, the negative impacts that occur on the environment, the development of its construction, operation and maintenance activities.

Title VIII declarations of public utility and transit rights-of-way


Article 81.-Declarations of public utility-the Ministry of electricity and renewable energy or public companies that provide the public service of electricity, for reasons of public utility or social and national interest, can purchase real estate which shall act with the Declaration of public utility or social interest, in the framework of the Constitution and the organic law of the national system of public contracting that are necessary for the implementation of the activities of generation, transmission, distribution and marketing of electric power and general lighting service.

The Ministry of electricity and renewable energy, at the request of popular and solidary economy or private legal persons may be declared of public utility or social and national interest real estate, which are necessary for the execution of the power generation activities.

Article 82.-use of infrastructure for provision of services public and easements of transit.-them companies electric public and mixed, responsible of the provision of the service public and strategic of energy electric and the service of lighting public general, shall enjoy of the right of use free of way, Poles, ducts, sidewalks e infrastructure similar of property State, regional, provincial, municipal, or of others companies public , by what are exempted from payment of taxes, fees and contributions by these concepts.

Article 83.-Easements.-public enterprises of the public electricity service and mixed economy companies, shall enjoy the right of extending transmission lines and electrical distribution and other facilities of the electric service, within the respective constituencies in which they provide their services.

Them rights generated as this article has the character of forced and allow the income and the occupation of the land by which cross the lines of transmission and distribution; but in any case, they are prohibition to alienate the property affected, but only an easement.

The Ministry of electricity and renewable energy or the public provision of the public service of electricity companies, may establish easements for the infrastructure of transmission lines and power distribution and other facilities of the electric service. The Ministry of electricity and renewable energy may establish the easement for the infrastructure of transmission lines and power distribution and other facilities of the electric service of private legal persons, enterprises of mixed economy and popular and solidary economy.

If by effects of such easements real estate brought useless, have to be declared of public utility.

Article 84.-occupation of land for placement of Poles, networks and laying of lines.-them companies electric will have, prior them studies respective, the right to occupy them areas of land necessary for the development of them activities following: 1. placement of Poles, towers, transformers or similar;

2 laying of underground lines, which includes the occupation of the subsoil by the lead wires, the depth and with characteristics that indicate the applicable legislation, in coordination with the competent authorities and other public service providers; and, 3. Laying of airlines, which includes, in addition to the flight on the grounds, servant, a strip of easement for the placement of Poles, towers or supports fi xed, the bearing capacity of lead wires of power, following the route of the line, in accordance with the characteristics and requirements of site safety.

In one or the other form, servitude includes equally the right of passage or access, temporary occupation of land and other goods needed for the construction, maintenance, repair and monitoring of electrical installations; as well as the entry of inspectors, employees and workers properly identifi ed and materials, more elements required for the operation and maintenance of these facilities.

If by effects of such easements real estate brought useless, have to be declared of public utility.

Public undertakings providing the public service of electricity will be exempt from the payment of royalties, taxes or any other consideration for the use or occupation of public space or public roads and airspace State, regional, provincial or municipal, for placement of structures, poles and routing networks.

Article 85.-compensation-the right of the owner of the respective property, is limited, of be the case, to the charge of the 24-third supplement-record offi cial No. 418-Friday 16 of January of 2015 corresponding compensation by them damage caused to them crops and to them plantations forest or tree that existed in the same. In all case, the owner is obliged to provide them facilities necessary for the effective application of the rights established in this law.

The servant property owner may not make plantations, constructions or works of another nature, which interfere with the free exercise of the electrical easements. Violation of this provision, or if their plantations or groves that crecieren so that they interfere with such exercise, shall entitle the holder of the easement to remedy this disturbance at the expense of the owner of the property.

Article 86.-the resolution.-the Ministry of electricity and renewable energy, after check studies works and verify technically the need for the construction of electrical works, administrative, duly motivated decision, imposed with obligatory character corresponding transit easement and entitle to the electric company to enter and occupy immediately, without further requirement , the area that is found affected by the right of easement.

Article 87.-Registration of the resolution-the administrative decision in force declaring these rights, will be registered, without further formality, in the appropriate land registry.

General provisions first.-general rules-within a maximum of 180 days following the promulgation of this law, the Agency for the regulation and Control of electricity ARCONEL will prepare the draft general regulation to the law, which will be submitted to the Ministry of electricity and renewable energy knowledge, and subsequently to the knowledge of the President Constitutional Republic.

Second.-binational generation-the Ecuadorian State can develop bi-national electric power generation projects, treatment of this generation will be held on the basis of conventions, agreements or bi-national instruments that you may subscribe, which stored pursuant to the Constitution, this Act and its general regulation.

Third.-third-party fundraising-electricity companies in distribution and marketing of electric power, exceptional and motivated, and prior authorization of the ARCONEL, may agree with the autonomous governments collection rates by pick-up trash. These values are indicated separately on separate Bill.

Fourth: the State shall guarantee the implementation of programmes and alternative electrifi cation projects in indigenous and rural communities of difficult access.

TRANSITIONAL provisions first.-contract award and current permissions.-for dealers and holders of permits and licences, in which the State has shareholding, corresponding enabling title will operate automatically, in the terms established by this law, without the need for any further requirement.

For dealers and holders of permits, licenses and registrations of private law as well as legal persons of private law that are operating at the date of adoption of this law and that do not meet the contract of concession, permit, license or registration, establishes a period of one hundred eighty (180) days to sign the corresponding enabling title in the terms established in this law. Where within this period will not end with the subscription of the enabling title, these legal entities may not participate in the sector and must initiate a new process for the granting of such certificates, according to the provisions of this law.

Second.-processes in process-procedures initiated at the CONELEC to obtain a lease, permit or license, prior to the entry into force of this law and that not completed to the date of its adoption, they must continue on the basis of the regulations in force at the date of acceptance of your application, it is applicable.

Third.-environmental permitting processes.-all the processes for obtaining environmental permits in charge of CONELEC, at any stage that they are, should continue on the basis of the regulations in force at the date of acceptance of their application, as applicable, to obtain the respective permit. Once come into force the present law, new procedures for the granting of environmental permits are the responsibility of the national environmental authority. The transfer of all environmental permits to the national environmental authority processes must occur within a period of one hundred eighty (180) days.


Fourth.-approval of tariff sheets-after the adoption of this law, the existing tariff specifications approved by the CONELEC will keep your application until the adoption of a new tariff spread on the basis of the provisions of this law and the corresponding regulation. Them subsidies by Defi cit tariff and rate dignity will keep its force in them terms and conditions force to the expedition of the present law, while not are modifi ED or deleted by the ARCONEL.

Fifth.-contracts regulated-them contracts regulated subscribed on the base of it established in the mandate constituent not. 15 and them regulations not. CONELEC 006 / 08, 013 / 08 and 004 / 09 and its reforms, is will continue to running during its period of validity; and, in the event that they wish to renew them, they must adjust to the principles of this law and the regulations issued for the purpose.

Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 25 sixth.-International electricity transactions-international electricity transactions will continue to run according to the principles laid down in existing Community legislation of the Commission of the Andean Community, in the agreements signed by the Ecuador, and in the regulations specifi issued on the matter, prior to the approval of this law.

Once they have new agreements with the regulators of neighbouring countries and the region, they will be included within the legal system of the Ecuadorian electric sector.

Seventh.-third-party fundraising-electrical distribution and marketing companies will continue raising through a unique electric form values corresponding to the rates by the garbage collection service for a maximum period of 360 days from the enactment of this Act. Once the expired govern specifically the third general provision of this law.

Octave. -From the Ministry of electricity and renewable energy.-the Ministry of electricity and renewable energy, continue their functions and powers in accordance with the provisions of this law.

Ninth.-of the Council national of electricity, CONELEC.-them server and servers that currently working in the Council national of electricity, CONELEC, through process of selection will spend to provide their services in it Agency of regulation and Control of electricity ARCONEL that is creates under the present law, respecting and recognizing its stability, rights and conditions labour force to the enactment of this law.

All them goods, active and passive of the Council national of electricity, CONELEC, will pass to form part of the heritage of the Agency of regulation and Control of electricity ARCONEL, of conformity with the provisions of the present law.

Administrative, judicial and arbitration, processes that are pending in the Consejo Nacional de Electricidad, CONELEC, shall be borne by the ARCONEL, the date of their integration.

Members of the current Board of the National Council of electricity, CONELEC, shall cease its functions to coming into force the present law.

The Executive interim Director of the National Council of electricity, CONELEC, perform the functions of the Executive Director of the Agency for the regulation and Control of electricity, ARCONEL, to be legally replaced pursuant to the provisions of this law.

Them servers public of the CONELEC that have come fulfilling functions in themes related with them powers that remained in the CONELEC and that under the present law pass to the Ministry of electricity and energy renewable, will pass by transfer administrative to the Ministry keeping their remuneration, by process of selection.

The Ministry of electricity and renewable energy will adjust its structure and organic regulation to the new responsibilities set out in this law.

Resources from the budget of the current Consejo Nacional de Electricidad - CONELEC, will become part of the budget of the Agency for the regulation and Control of electricity, ARCONEL.

Until that becomes a reality the allocation and resources coming from the General State budget for the operation of the Agency for the regulation and Control of electricity, ARCONEL, will remain the contributions made to the Consejo Nacional de Electricidad, CONELEC, agents of the electricity sector, in the same form of the immediately preceding year.

Tenth.-of the Corporation Centre national energy control.-the staff currently working in the National Center Corporation of Energy Control, CENACE, through selection process will continue their services in the national electricity operator; It will be respected and its stability, individual rights and working conditions applicable to the promulgation of this law will be recognized. The classifi cation of servers and workers will be held in accordance with the law, applicable legal regime change to staff is not untimely dismissal or shall be subject to compensation or bonifi cation by the national operator of electricity, nor of the Ecuadorian State. In case of retirement, evict or dismissal untimely, is will take in has them years of service that were rendered in the Corporation Centre national of Control of energy, summed to the time of service in the institution that is creates, with them limits planned in them mandates constituents and in the law.

The Ministry of electricity and renewable energy, in one period of no more than 180 days from the enactment of this Act, approve the organic structure, salary scales, organic regulation and functional regulation of the national operator of electricity, CENACE.

All property, assets and liabilities of the Corporation Centre national energy Control, CENACE, will become part of the heritage of the institution under public law established by this law, known as operator national DE ELECTRICIDAD, CENACE, in accordance with the provisions of this law.

Them processes administrative, judicial and arbitration, that is are in process in the Corporation Centre national of Control of energy, CENACE, will be assumed by the operator national of electricity, CENACE, created by the present law.

26. third supplement - registration offi cial No. 418 - Friday, January 16, 2015 the assets of the Corporation, shall form the heritage of the national operator of electricity, CENACE.

The members of the directory of the National Center for Energy Control, CENACE, shall cease its functions to coming into force the present law.

Executive Director, will become Executive Director of the national operator of electricity, CENACE and continue so to be legally replaced extended functions.

Tenth first.-internal regulations-in a period of one hundred and eighty (180) days, after the publication in the register offi cial of this law, the regulation and Control of electricity ARCONEL Agency and national electricity operator, CENACE shall issue internal regulations are required for normal operation.

Tenth second.-companies placed under the procedure provided for in the constitutional mandate no. 15.-in the case of the companies cited the constitutional mandate no. 15, in the third transitional provision, first paragraph, and in the transitional provision second paragraph 2.2.1.5 of the organic law of public enterprises, the Ministry of electricity and renewable energy, within the period of three hundred sixty (360) days from the issuance of this law, carry out all the actions that are necessary, to the same structure as public companies, which, it will consolidate shares in his favor.

Once consolidated all of the shares in favor of the Ministry of electricity and renewable energy, these companies will be dissolved without liquidation and will be transformed into public companies.

It corresponds to the Ministry of electricity and renewable energy apply for financial resources to private shareholders and other shareholders must come from the General budget of the State, in order to acquire the shares and contributions for future capitalization that maintain decentralized, autonomous governments at nominal value which consists of books to the Ministry of finance.

The companies cited in the third transitional provision, first paragraph of the mandate constituent No. 15 and transitional provision second paragraph 2.2.1.5 of the organic law of public companies, in the term of 15 days counted from the entry into force of this Act, notify caran to the Ministry of electricity and renewable energy rating in books of actions and contributions for future capitalization of the fi n that within a maximum of 180 days from the notifi cation previously designated, are acquired and consolidate the share package in favour of such a Ministry. If the companies contained in the third transitional provision, first paragraph of the mandate constituent No. 15 and disposal transient second paragraph 2.2.1.5 of the organic law of public companies there are shareholders who belong to public institutions of the Central Government and public of the electric sector companies, such shares will be free of charge to the Ministry of electricity and renewable energy.

The Ministry of electricity and renewable energy can pay actions and contributions for future capitalizations autonomous governments decentralized, through the implementation of infrastructure projects in their respective constituencies.


In addition payment to the shareholders of the utilities should primarily include the mechanism of compensation for outstanding debts with the State and/or Government contributions to infrastructure projects that are running or will run the autonomous governments; Likewise the payment to the shareholders of them companies electric is can make through them mechanisms or instruments that defi na the Ministry of finance.

If after one year of entry into force of this law the decentralized autonomous Government not appropriate to the transfer of domain's actions once formulated the mechanism of compensation for outstanding debts with the State and/or Government contributions to infrastructure projects that run or run or not changes to an agreement on the transfer of shares for the purpose of consolidating the stock package, the company directory will have their legal representative who, check Ed carrying actions and compensatory works, proceed to issue new shares and register them in the book of shares and shareholders on behalf of the Ministry of electricity and renewable energy, as well as to cancel old shares , not requiring it of other requirements or procedures for such effect. This decision may be challenged in the courts.

Tenth third.-companies which are maintained as joint-stock companies-electricity companies of distribution that the entry into force of this Act are kept as joint-stock companies with State equity stake, and that, by application of the constitutional mandate no. 15 had negative equity involvement, will be compensated in an amount equal to such involvement through investments that make the State at the same , funded by the General budget of the State.

Tenth fourth.-FIMFEISEH.-the debts that keep companies in the electrical sector that had its origin in the FEISEH established in article 7 of the law of creation of the Ecuadorian investment fund in the energy sectors and Hidrocarburífero FEISEH, are extinct and will be accounted as heritage contributions or future capitalization, as appropriate, in favor of the Ministry of electricity and renewable energy , for which the Ministry of finance will implement the actions that correspond to said fi n.

Third supplement - Registration offi cial No. 418 - Friday 16 January 2015 - 27 REFORMATORIAS provisions first.-delete the words "and ordinances" of the first paragraph of article 40 of the law of consumer protection.

SECOND.-in the article the first paragraph of Article 479 of the code of Territorial organisation, COOTAD, after the words "of public services" removed the grammatical sign dot (.), instead joining the grammatical sign comma (,) and then joining the words "with the exception of the service of power".

THIRD.-in article 32 of the law on defence against fire, replace the paragraph immediately following the numerals constants of the same with the following: "the tax provided for in this article may be charged by electric utilities prior Convention adopted by those and the respective value will be raised through a Bill separate from that which sets the cost of electricity".

REPEALING abrogated all the laws of equal or lesser hierarchy that oppose or not stored pursuant to the provisions of this law.

In particular, repeal the following regulations: • the law of regime of the Sector electric, published in the supplement of the registry offi cial No. 43 of 10 October 1996 and all his reforms.

• The General Regulation of the law of regime of the Sector electric, published in the second supplement of the registry offi cial No. 401 of 21 November 2006, and all of its reforms, in which are opposed to this law and until it is issued the general regulation of this.

• The term constituent No. 9 adopted by the constituent Assembly of Montecristi, on May 13, 2008.

• The term constituent No.15 approved by the Assembly constituent of Montecristi the 23 of July of 2008.

• The agreement Ministerial not. 151 of the Ministry of energy and mines, of 5 of October of 1998, published in the register offi cial not. 55 of 27 of October of 1998.

• The exemption in the third general provision of the organic law of Intercultural Education published in the second supplement of the registry offi cial No. 417 of March 31, 2011, as it relates to fi x the value of consumption of electric power by the national education authority.

DISPOSAL provisions of this law and its reformatorias and derogations, shall be effective from the date of its promulgation in the registry offi cial.

Given and signed at the headquarters of the National Assembly, located in the Metropolitan District of Quito, Pichincha province, the eight days of the month of January of two thousand fifteen.

f.) GABRIELA RIVADENEIRA BURBANO, President.

f.) Dr. Libya RIVAS ORDÓÑEZ, Secretary General.

28-third supplement-registration offi cial No. 418-Friday 16 of January of 2015