Energy crisis in Ecuador: power cuts and major economic challenges

Ecuador is experiencing a major energy crisis, with rotating power cuts due to a historic drought. This situation raises major economic and social issues, prompting us to rethink our dependence on hydroelectricity and explore sustainable solutions.

Share:

Comprehensive energy news coverage, updated nonstop

Annual subscription

8.25$/month*

*billed annually at 99$/year for the first year then 149,00$/year ​

Unlimited access • Archives included • Professional invoice

OTHER ACCESS OPTIONS

Monthly subscription

Unlimited access • Archives included

5.2$/month*
then 14.90$ per month thereafter

FREE ACCOUNT

3 articles offered per month

FREE

*Prices are excluding VAT, which may vary depending on your location or professional status

Since 2021: 35,000 articles • 150+ analyses per week

Ecuador is facing an unprecedented energy crisis, marked by the introduction of rotating nationwide blackouts.
This decision, announced by the authorities, is a direct response to a severe drought that is affecting the operation of hydroelectric power plants, essential to the country’s electricity production.
The government has stated that this drought is the most severe seen in 61 years, which has led to the need to responsibly manage the national power system.
Starting on Monday, power cuts will be applied four nights a week, with durations varying from two to four hours depending on the sector and distribution company.
Energy Minister Antonio Goncalves has specified that some regions, where 70% of electricity demand depends on hydroelectric production, will not be subject to these restrictions.
This approach is aimed at minimizing the impact on economic activities and adapting citizens’ working hours.
The government has also imposed teleworking for the public sector on Thursdays and Fridays for the next two weeks.

Economic and social impact of power cuts

Power cuts have significant economic consequences.
According to the Chamber of Commerce of the Port of Guayaquil, Ecuador loses around 12 million dollars per hour of blackout.
This situation is all the more worrying in a context where the country has already experienced prolonged water cuts, reaching up to 13 hours a day in April.
Hospitals and emergency services are exempt from these cuts, but the situation remains critical for many businesses that depend on a stable electricity supply.
The government has also introduced curfews in six provinces and in the mining town of Camilo Ponce Enriquez, due to violence linked to drug gangs.
This measure, combined with the energy crisis, further complicates the situation for citizens and businesses.
At the same time, the armed forces have been deployed to ensure the security of critical infrastructures, such as the Mazar dam, which supplies water to several hydroelectric plants.

Government responses and future prospects

Faced with this crisis, the Ecuadorian government has declared a state of emergency in the electricity sector.
Due to low river flows, the country is facing an energy deficit of around 1,000 megawatts.
To alleviate this situation, the government has acquired a thermal generation barge, which should offset part of this deficit.
However, this temporary solution raises questions about sustainability and increased dependence on non-renewable energy sources.
Antonio Goncalves emphasized the importance of these measures, saying,

“We need to act quickly to guarantee the continuity of electrical service while preserving the safety of our infrastructures.”

This statement highlights the need for a balanced approach between the management of energy resources and public safety.

Long-term consequences and challenges of decarbonization

The current situation raises crucial issues for Ecuador’s energy future.
Dependence on hydroelectricity, although renewable, exposes the country to risks linked to climatic variations.
The need to diversify the energy mix is becoming ever more pressing, in particular by integrating alternative renewable energy sources.
Decarbonizing the energy sector is a long-term goal, but the immediate challenges of drought and security must be addressed as a priority.
The power cuts and emergency measures put in place by the Ecuadorian government illustrate the tensions between natural resource management and economic needs.
As the country navigates through this crisis, it is essential to consider sustainable solutions that guarantee not only energy security, but also resilience in the face of future environmental challenges.

The gradual exit from CfD contracts is turning stable assets into infrastructures exposed to higher volatility, challenging expected returns and traditional financing models for the renewable sector.
The Canadian government introduces major legislative changes to the Energy Efficiency Act to support its national strategy and adapt to the realities of digital commerce.
Quebec becomes the only Canadian province where a carbon price still applies directly to fuels, as Ottawa eliminated the public-facing carbon tax in April 2025.
New Delhi launches a 72.8 bn INR incentive plan to build a 6,000-tonne domestic capacity for permanent magnets, amid rising Chinese export restrictions on critical components.
The rise of CfDs, PPAs and capacity mechanisms signals a structural shift: markets alone no longer cover 10–30-year financing needs, while spot prices have surged 400% in Europe since 2019.
Germany plans to finalise the €5.8bn ($6.34bn) purchase of a 25.1% stake in TenneT Germany to strengthen its control over critical national power grid infrastructure.
The Ghanaian government is implementing a reform of its energy system focused on increasing the use of local natural gas, aiming to reduce electricity production costs and limit the sector's financial imbalance.
On the 50th anniversary of its independence, Suriname announced a national roadmap including major public investment to develop its offshore oil reserves.
China's power generation capacity recorded strong growth in October, driven by continued expansion of solar and wind, according to official data from the National Energy Administration.
The 2026–2031 offshore programme proposes opening over one billion acres to oil exploration, triggering a regulatory clash between Washington, coastal states and legal advocacy groups.
The government of Mozambique is consolidating its gas transport and regasification assets under a public vehicle, anchoring the strategic Beira–Rompco corridor to support Rovuma projects and respond to South Africa’s gas dependency.
The British system operator NESO initiates a consultation process to define the methodology of eleven upcoming regional strategic plans aimed at coordinating energy needs across England, Scotland and Wales.
The Belém summit ends with a technical compromise prioritising forest investment and adaptation, while avoiding fossil fuel discussions and opening a climate–trade dialogue likely to trigger new regulatory disputes.
The Asian Development Bank and the Kyrgyz Republic have signed a financing agreement to strengthen energy infrastructure, climate resilience and regional connectivity, with over $700mn committed through 2027.
A study from the Oxford Institute for Energy Studies finds that energy-from-waste with carbon capture delivers nearly twice the climate benefit of converting waste into aviation fuel.
Signed for 25 years, the new concession contract between Sipperec, EDF and Enedis covers 87 municipalities in the Île-de-France region and commits the parties to managing and developing the public electricity distribution network until 2051.
The French Energy Regulatory Commission publishes its 2023–2024 report, detailing the crisis impact on gas and electricity markets and the measures deployed to support competition and rebuild consumer trust.
Gathered in Belém, states from Africa, Asia, Latin America and Europe support the adoption of a timeline for the gradual withdrawal from fossil fuels, despite expected resistance from several producer countries.
The E3 and the United States submit a resolution to the IAEA to formalise Iran's non-cooperation following the June strikes, consolidating the legal basis for tougher energy and financial sanctions.
The United Kingdom launches a taskforce led by the Energy Minister to strengthen the security of the national power grid after a full shutdown at Heathrow Airport caused by a substation fire.

All the latest energy news, all the time

Annual subscription

8.25$/month*

*billed annually at 99$/year for the first year then 149,00$/year ​

Unlimited access - Archives included - Pro invoice

Monthly subscription

Unlimited access • Archives included

5.2$/month*
then 14.90$ per month thereafter

*Prices shown are exclusive of VAT, which may vary according to your location or professional status.

Since 2021: 30,000 articles - +150 analyses/week.