Ecuador will reward households that save energy with discounts on their bills

The Ministry of Environment and Energy issued Ministerial Agreement MAE-MAE-2026-0098-AM, which defines the mechanisms for promoting savings and incentivizing energy efficiency, featuring bill discounts for residential users who prove a verifiable reduction in their consumption and surcharges for regulated medium and high-voltage consumers. The instrument was signed on October 12, 2026, by Minister Juan Carlos Damián Blum Baquero and published in the Official Registry No. 400, Year II, on Thursday, October 29, 2026, on page 3.

CENACE’s Request and the Mazar Critical Level

The agreement responds to official letter CENACE-CENACE-2026-1881-0 dated October 2, 2026, through which the National Electricity Operator (CENACE) submitted the report and update of the “Contingency Plan to Manage the Generation Deficit Condition in the National Interconnected System.” In that document, the operator technically justified the need to apply demand management and restriction measures of between 15% and 20% to moderate the decline of energy reserves and prevent the equivalent reservoir of Mazar from falling below its critical level of 2125 m above sea level.

The Ministry based the decision on the Organic Law of the Public Electric Energy Service and the Organic Law of Energy Efficiency, which mandate the State to promote efficiency through incentives or penalties. It also invoked Executive Decree No. 355 of August 14, 2024, which tasked the governing ministry with coordinating actions with CENACE to face the dry season, and Article 18 of the General Regulations of the Organic Law of Energy Efficiency, which requires large consumers to implement the NTE-INEN-ISO 50001 standard.

How Discounts and Surcharges Will Work

Article 3 of the agreement tasks the Electricity Regulation and Control Agency (ARCONEL) with issuing the technical, economic, and legal reports that will serve as the basis for its application resolution, consisting of two components:

• A surcharge or economic deterrent signal for regulated medium or high-voltage consumers, with methodology, technical parameters, and baselines defined by ARCONEL.
• An incentive structure translated into bill discounts for residential consumers who record verifiable savings compared to their historical baseline, with percentages and conditions yet to be established.

Supplies for public entities, those exclusively intended for social assistance, and water pumping facilities for the Public Drinking Water Service are exempt from the surcharge. The territorial scope is the Ecuadorian continental territory and involves the Electricity Distribution Companies (EED), CENACE, and regulated consumers.

Deadlines, Validity, and Financial Safeguards

The First Transitory Provision sets a period of fifteen days for the ARCONEL Board to issue the implementation resolution. Distributors will then have ten days from the publication of that resolution to adapt their commercial, financial, and accounting systems. The Third Transitory Provision stipulates that the mechanisms shall be applied during November and December 2026 to medium-voltage consumers whose monthly consumption is equal to or greater than that of High Voltage 1 users.

The agreement further establishes that the amounts collected from deterrent signals shall be recorded as third-party resources under entrustment or custody, not as ordinary income for the distributors nor as funds of the General State Budget. The EEDs shall open special sub-accounts at the Central Bank of Ecuador (BCE) with separate accounting, and residential incentives shall be financed only up to the amount effectively collected, without generating liabilities or contingencies for the companies or the State. The compensation of balances shall be reported to the Payment Supervision Committee of the Electricity Sector, created by Ministerial Agreement MEM-MEM-2024-0044-AM.

ARCONEL will perform monthly monitoring and control and will report to the governing ministry, which may activate, suspend, or reactivate the mechanisms according to the evolution of the National Interconnected System (SNI). Distributors must execute socialization campaigns.

Impact for Users

The regulation reaches all households and companies with a meter in the country: the former may see reductions in their bills if they demonstrate savings, while large regulated consumers will assume a temporary surcharge intended to finance those discounts. Its real effect, however, depends on the resolution that ARCONEL must issue within a maximum period of fifteen days from the signing of the agreement, as the percentages, baselines, and accreditation conditions will be defined therein.

Source: Official Registry, No. 400, October 29, 2026, Section I, p. 3 (official reference: Ministerial Agreement MAE-MAE-2026-0098-AM).