Domingo, 20 de Octubre de 2019
Última actualización: 10:47 CEST

Electricity consumption figures are bad news

Night in Havana. (CNN)

The National Statistical Office of Cuba (ONEI) has just published an interesting report on activity in the Energy sector under the Castro economy in 2016, entitled"Electricity in Cuba: Selected Indicators, January-December 2016."

We are already in mid 2017 and there is still important information missing to make possible a thorough analysis of the island's economic situation, such that any information offered by the authorities, however meager, is appreciated.

The publication was presented with great care. And, given the close relationship between energy consumption and economic activity, present and future – which we know, based on official data from the regime, has been waning since the middle of last year - the information published by the ONEI has presented is of extraordinary interest, as it gives us a more precise idea of ​​the magnitude of the collapse of Cuba's economic activity, and makes it possible to evaluate medium term forecasts.

According to data provided by the ONEI, electricity consumption in Cuba was 15,182 gigawatt hours in 2016. The data itself does not say much if it is not compared to that from the previous year. The first thing that stands out is that the aforementioned ONEI publication fails to mention the data from the year prior. No matter. We looked in Cuba's Statistical Yearbook 2015 and (surprise!) found that electricity consumption that year was at 20,288 gigawatt hour.

That is, in a single year, of deep recession, and which some of us estimate places us on the verge of something resembling the Special Period, the consumption of electricity in Cuba plummeted 25.2%, a quarter of that consumed the previous year. This drop is so sharp that the current phase of economic contraction can be considered one of the most serious in the last 20 years. A slump of this magnitude paralyzes and calls into question the entire process entailed by the government's "Guidelines and Conceptualizations" and other gibberish. And what is worse, the figure is bad enough to suggest that in the coming months it may get even worse.

If consumption is broken down by its two main components, State and private, it may be observed how they saw different dynamics in the period in question.

State consumption, which represents a whopping 43% of the total (which gives one an idea of ​​the State's massive impact on the Cuban economy under Castro), fell 29.6%, four percentage points more than the mean, from 8,648.5 gigawatt hours in 2015 to 6,085.8 gigawatt hours in 2016. In an economy like Castro's, in which a good portion of the goods and services provided the population are produced in the State sector, this is not a good figure. Quite the opposite.

Private consumption, meanwhile, including residential, saw a moderate increase, going from 8,468.3 gigawatt hours in 2015 to 8,792.1 gigawatt hours in 2016, up 3.8%.

This uneven behavior between the two indicators confirms that the regime is preventing the economic collapse from crushing individuals, through discriminatory policies to avert a social revolt, as the State remains the fundamental cornerstone the economy, suffering a severe drop in electricity consumption, with its ensuing repercussions in terms of reduced activity, past and future.

Analysts of the situation know that the collapse in the total consumption of electric energy is indicative of a recession, and can see, via comparison with the historical figures offered by ONEI, that the consumption recorded in 2016 was down to the level of the distant year 2000, when the figure stood at 15,032.2 gigawatt hour. That is, electricity consumption has fallen to the same level as 16 years ago.

From then until 2015, save for a brief hiccup from 2004 to 2005, annual electricity consumption had been increasing at an average rate of 2.3%, from the above figure to 20,288 gigawatt hours in 2015. Thus, the sharp fall recorded in 2016 breaks what had been an upward trend, and will have particularly negative consequences on the design and implementation of economic policies.

The dependence on oil from Venezuela, and having failed to foresee and prepare for the interruption in shipments currently being suffered, and the lack of a strategy to implement renewable energies on the Island, are behind these dreadful figures, which threaten economic growth and promise more hardships and high prices for Cubans.

Worst of all is that the worst, apparently, is yet to come, with some predicting it will hit in a few months, such that Cubans will have to tighten their belts even more. The electricity consumption figures indicate that an economic standstill is imminent.