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# Venezuela Opened Electricity Generation to Private Capital. A Self-Generator That Refuses to Supply in a State of Exception Loses Its Licence.
- URL: https://www.lacaribenanews.com/venezuela-electricity-law-article-105-self-generation-revocation-2026/
- Published: 2026-11-11T02:56:36.000Z
- Updated: 2026-11-11T02:56:38.000Z
- Description: Venezuela's National Assembly sanctioned a reformed electricity law on 10 November 2026 and sent it to the Executive for promulgation. Article 64 admits private firms to generation. Article 105 revokes the licence of a self-generator above two megawatts that refuses supply in a state of exception.
- Author: Theon Alleyne
- Tags: Venezuela, Caribbean, Energy, Electricity, investment, Business, Beat: energy-transition-tariffs

**Quick summary:** Venezuela's National Assembly sanctioned a reformed electricity law on 10 November 2026 and said it goes immediately to the Executive for promulgation. Article 64 admits private and mixed companies to generation. Article 105 revokes the authorisation of a self-generator above two megawatts that refuses to supply during a declared state of exception.

By LCN Business Desk

Venezuela's National Assembly published its own clause-by-clause account of the electricity law it sanctioned on the evening of 10 November 2026\. Two provisions in it point in opposite directions, and both bind the same investor.

## What did the Assembly actually do on 10 November?

Sanctioned the reform and sent it on. It is not yet law.

The Parliament sanctioned the reform of the Ley Orgánica del Sistema y Servicio Eléctrico, the Organic Law of the Electricity System and Service, in an ordinary session. [The Assembly's own notice](https://www.asambleanacional.gob.ve/noticias/parlamento-sanciona-ley-organica-del-sistema-y-servicio-electrico?ref=lacaribenanews.com) says the law "será remitida inmediatamente al Ejecutivo Nacional para su promulgación", will be sent immediately to the National Executive for promulgation. Promulgation is the step after sanction, and publication in the Gaceta Oficial, the official gazette, is the step after that.

So anything describing this as a law in force is ahead of the Assembly. The same notice records that the second discussion opened on 22 October and ran across four ordinary sessions, and that the Parliament has sanctioned fourteen laws so far this year.

The reform also sets rules for the international exchange of energy, across generation, transmission, system dispatch, distribution and commercialisation.

## What does Article 64 open?

Generation and self-generation, to private and mixed companies, and the Assembly's president addressed the clause by number.

Jorge Rodríguez, President of the Legislature, [took the floor before the vote to answer questions about Article 64 specifically](https://www.asambleanacional.gob.ve/noticias/ley-del-servicio-electrico-abre-espacios-al-sector-privado-y-garantiza-suministro-a-zonas-vulnerables?ref=lacaribenanews.com). "La ley no promueve, en modo alguno, la privatización del sistema eléctrico nacional," he said: the law in no way promotes privatisation of the national electricity system, but rather "la apertura para que sectores privados puedan incorporarse a la generación, a la autogeneración de electricidad y puedan, en ese sentido, obtener algún tipo de transacción comercial sobre esa electricidad": the opening for private sectors to join generation and self-generation, and to obtain some kind of commercial transaction on that electricity.

He added that the State keeps responsibility for guaranteeing service to all sectors, especially the most vulnerable.

## What does a private generator get, and on what terms?

A concession of up to 25 years, above a 50 megawatt threshold, nothing to keep at the end, and a choice of forum.

| Term in the reformed law                    | What it says                                                                                                                                                      |
| ------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| Maximum concession to a private firm        | 25 years                                                                                                                                                          |
| Who awards it                               | Ministerio de Energía Eléctrica, the Ministry of Electric Energy                                                                                                  |
| Generation threshold requiring a concession | above 50 MW                                                                                                                                                       |
| Also requiring one                          | public-domain assets, trunk transmission, distribution and commercialisation in exclusive-service areas, regionally integrated systems                            |
| At the end of the term                      | all assets incorporated, built or acquired revert to Corpoelec, the national electricity corporation, or a designee, "libres de gravámenes", free of encumbrances |
| Disputes                                    | Venezuelan courts, or mediation and arbitration                                                                                                                   |

Source: [El Nacional, Caracas, 10 November 2026](https://www.elnacional.com/2026/11/asamblea-nacional-aprueba-reforma-legal-para-abrir-el-sector-electrico-al-capital-privado-y-extranjero?ref=lacaribenanews.com), reading the approved text. These terms are the newspaper's reading; the Assembly's own account covers different articles and does not restate them.

A 25-year term is long enough to finance a power plant. A reversion clause that hands the plant to the state operator free of encumbrances at the end means the asset is not the investor's to sell, to refinance against late in the term, or to walk away with. What is on offer is a quarter-century of revenue, not ownership.

The 50 megawatt line is where a Caribbean reader can place the scale. It is the point at which a project stops being a private arrangement and needs a minister's signature, and it is smaller than the whole electricity system of several of Venezuela's neighbours: [one docked cruise ship can draw up to 12 megawatts, and Grenada's entire power system is 70](https://www.lacaribenanews.com/cruise-shore-power-caribbean-ports-grid-capacity-grenada-2026/).

The nearest comparable statute in the region is drawn the other way round. [Ley 7200 of 1990 caps parallel generation at 15 per cent of Costa Rica's national system and each plant at 20 megawatts](https://www.lacaribenanews.com/costa-rica-ley-7200-solar-electricity-reform-2026/), and a bill to repeal it passed first debate in May 2026 before being withdrawn for want of the votes at second debate. Costa Rica sets a ceiling on how much private generation the system will take. Venezuela sets a floor above which the minister decides.

## What happens in a state of exception, and why does it bite the oil industry?

The authorisation is revoked, and the oil companies are the ones the law requires to have built the generation in the first place.

Article 105 provides that owners of self-generation installations above two megawatts who refuse to supply electricity during a state of exception decreed by the National Executive face direct revocation of their administrative authorisation, on top of any fine. Two megawatts is a small industrial plant, well below the 50 megawatt line that triggers a concession in the first place.

Article 104 sets the fines for self-generation and independent systems at between 1,000 and 10,000 times the official exchange rate of the highest-value currency published by the Banco Central de Venezuela, the central bank, for breaches during a state of exception or an emergency. The Assembly records that the Plenary amended this during debate, adding safeguards to weigh justified material or technical impossibility, to guarantee due process and the right of defence, and to require fair remuneration of energy contributed to the National Electricity System.

A power that can compel supply needs a rule about paying for it, and the Plenary wrote one in during the debate rather than before it.

Oil companies, for their part, must secure and guarantee a continuous, regular, reliable, sufficient and stable supply of electricity for their primary activities, through self-generation, cogeneration or contracting third parties, to secure their operational autonomy. Neither they nor independent generators need state authorisation to generate for their own internal networks. They need it only to interconnect to the national grid.

Taken together, the two obligations are a single arrangement. The oil industry is required to build its own generation, and the state may requisition that generation in a decreed state of exception, with the licence as the forfeit. The reform invites private capital into the public system, takes the public system off the oil industry's critical path, and keeps a claim on what the oil industry builds instead.

Washington has said the two halves are one problem. United States Energy Secretary Chris Wright, in Caracas in early September, said it would be easier to raise generating capacity in the oilfields themselves, "pero ambas cosas tienen que suceder en paralelo", but both things have to happen in parallel.

## What is a state of exception, and how long can one last?

A constitutional regime the President decrees in Council of Ministers, in one of three kinds, each with its own ceiling.

The term is not interchangeable with "state of emergency". Under the Constitution an economic emergency is one kind of state of exception, alongside a state of alarm and a state of internal or external commotion, so "state of emergency" in English names the narrower category rather than the general one. The electricity law relies on the distinction in its own text: Article 104 lists states of exception **and** emergency situations as two separate triggers, while Article 105, the revocation clause, names only a state of exception.

| Kind, Article 338                       | When it may be decreed                                                                             | Duration      | Extension       |
| --------------------------------------- | -------------------------------------------------------------------------------------------------- | ------------- | --------------- |
| Estado de alarma                        | catastrophes, public calamities or similar events seriously endangering the security of the Nation | up to 30 days | up to 30 more   |
| Estado de emergencia económica          | extraordinary economic circumstances gravely affecting the economic life of the Nation             | up to 60 days | an equal period |
| Estado de conmoción interior o exterior | internal or external conflict seriously endangering the Nation, its citizens or its institutions   | up to 90 days | up to 90 more   |

Source: [Constitución de la República Bolivariana de Venezuela, Articles 337 to 339](https://venezuela.justia.com/federales/constitucion-de-la-republica-bolivariana-de-venezuela/titulo-viii/capitulo-ii/?ref=lacaribenanews.com). Approval of any extension belongs to the National Assembly.

Those ceilings are the outer bound on how long a self-generator's supply obligation can be live at one time. Article 337 confines the grounds to circumstances of a social, economic, political, natural or ecological order that gravely affect the security of the Nation, and Article 339 requires the decree to go within eight days both to the National Assembly for approval and to the Constitutional Chamber of the Supreme Tribunal of Justice for a ruling on its constitutionality. It must comply with the International Covenant on Civil and Political Rights and the American Convention on Human Rights, and it is revoked once the causes cease.

## What is the penalty regime around it?

Fines scale with the operator's revenue, and the far end of the scale is a prison term.

The Superintendencia del Sistema Eléctrico Nacional, the national electricity system regulator, may open administrative investigations and act against operators, their board members, service providers and users. Serious faults by an operator carry fines of up to 2 per cent of the previous year's gross revenue, which the Assembly lists as covering repeated breaches of quality rules, unjustified refusal of access to the networks, and alterations to supply or tariffs. Less serious operational irregularities, and delays in settling transactions in the electricity market, carry up to 0.2 per cent.

Taking electricity for profit through unauthorised connections above 5,000 kilowatt hours a month carries two to six years in prison. Theft of the equipment or installations used to provide and meter the service carries two to five years, whether or not it is done for profit. Administrative actions and sanctions prescribe after five years.

The transitional provisions set the real clock. The regulation is due within 180 days, as is the adaptation of the Centro Nacional de Despacho, the national dispatch centre, to the energy ministry's structure. The Executive has one year to constitute the fund that finances subsidies, two years to update the user database, and five years for the state operator to normalise supply points.

## Where is the text?

Not yet published, and the register that would carry it stopped being updated in 2021.

The Assembly's statement that the law goes immediately to the Executive places it before promulgation, so there is no Gaceta Oficial entry to cite. The Assembly also maintains a public register of sanctioned laws. It holds two entries, both dated 14 December 2021, the debt and budget laws for the 2022 financial year, and the Gaceta number field is empty for both.

A 25-year concession is priced off the instrument, and the instrument is not public. The clause detail above reaches the public through a newspaper's reading of the approved text and through the Assembly's own summary of selected articles, neither of which is the instrument. [Guyana announced a vape import restriction on 17 October and the order that would create it was not in the Official Gazette](https://www.lacaribenanews.com/guyana-vape-import-restriction-customs-order-not-gazetted-2026/); [CARICOM is finishing an expansion of its 1994 trade agreement with Colombia and the tariff schedules governing which Guyanese products face cheaper imports have not been published](https://www.lacaribenanews.com/colombia-caricom-trade-agreement-industrial-tariffs-2026/). An announced instrument and a published one are different things to build a business on.

## Who is allowed to invest, though?

Fewer companies than the law admits, because the licensing sits in Washington rather than Caracas.

A statute opening a sector to foreign capital does not make the capital lawful to deploy. [ExxonMobil signed a non-binding memorandum with PdVSA on 9 November and named stable policies, clear regulations, strong investment protections and competitive returns as its conditions; General Licence 50C names six companies authorised for Venezuela, and ExxonMobil is not among them, while Chevron, holding 30 per cent of Stabroek, is](https://www.lacaribenanews.com/exxon-venezuela-mou-four-conditions-guyana-ring-fencing-2026/).

The same architecture governs money moving the other way: [the Office of Foreign Assets Control issued Venezuela-related General Licence 60A on 16 October 2026, and payments under it need not go into the Foreign Government Deposit Funds Account that seven other licences keep as a requirement](https://www.lacaribenanews.com/ofac-gl60a-venezuela-earthquake-relief-fgdf-exemption-2026/). Which account a payment lands in is a licence question, not a commercial one.

## What does this mean for Guyana and the Caribbean?

That the brake on Venezuela's oil expansion is being legislated away, and that the courting of the neighbours on energy is already under way.

Guyana's output competes with a Venezuelan recovery whose constraint has been power. Electricity is the third sector opened in sequence, [after hydrocarbons and mining, on Agence France-Presse's account of the same vote](https://www.diariolibre.com/mundo/america-latina/2026/11/10/venezuela-permite-inversion-privada-en-sector-electrico/3717031?ref=lacaribenanews.com).

[Venezuela has taken its energy talks to three CARICOM capitals since April, and signed ten documents with Suriname in Paramaribo on 11 September, including oil and gas cooperation](https://www.lacaribenanews.com/venezuela-rodriguez-caricom-visits-guyana-trade-2026/). A country that can offer a 25-year generation concession has something new to put on that table, and a country whose law can revoke a self-generator's licence in an emergency has something new to disclose at it.

The tariff half is where a neighbour's own numbers are the guide. Electricity in Venezuela is at present practically free, and AFP reports that many Venezuelans expect to pay more; Rodríguez said in session that the service would continue "sobre todo a los más vulnerables", above all to the most vulnerable. Neither the Assembly nor AFP gives a figure for what the tariff becomes. What a cost-reflective tariff looks like is a question Guyana has already priced: [it rents 96 megawatts from two floating power plants at 9.5 US cents a kilowatt hour, and because the state buys the fuel separately, a unit really costs about 19 cents](https://www.lacaribenanews.com/guyana-third-powership-costs-puerto-rico-energy-choice-2026/).

And the reversion clause has a mirror image two islands away. Venezuela has written down what the investor hands back at the end. [Puerto Rico's grid operator priced its own dismissal at about US$1.3 billion, of which its brief said at least US$726 million was unavoidable](https://www.lacaribenanews.com/luma-energy-contract-termination-cost-puerto-rico-grid-exit-price-2026/). A government that says up front what returns to the state is answering, 25 years early, the question that became litigation in San Juan.

One point in the record is contested and the two accounts have not been reconciled. AFP describes the 2007 move as the estatización, the taking into state hands, of the electricity service, and gives it as the cause of the investment shortfall that followed. Rodríguez told the chamber that the service had been in private hands for 100 years until then, which left remote rural areas with less investment, and that "no fue que se nacionalizó, sino que se compró": it was not nationalised but bought, Electricidad de Caracas acquired from a United States company that owned it at the time.

### The entities

\- **National Assembly** of Venezuela sanctioned the reform on 10 November 2026 and published its own account of the articles. - **Jorge Rodríguez** is President of the Legislature. - **Ley Orgánica del Sistema y Servicio Eléctrico** is the law reformed. - **Ministerio de Energía Eléctrica**, the Ministry of Electric Energy, awards the concessions. - **Corpoelec**, the national electricity corporation, is the state operator the assets revert to. - **Superintendencia del Sistema Eléctrico Nacional** enforces the sanctions regime. - **Banco Central de Venezuela** publishes the exchange rate the fines are calculated from. - **Constitución de la República Bolivariana de Venezuela** sets the kinds and durations of a state of exception at Articles 337 to 339\. - **Supreme Tribunal of Justice** rules through its Constitutional Chamber on the constitutionality of a decree within eight days. - **Centro Nacional de Despacho** must be adapted to the energy ministry's structure within 180 days. - **El Nacional** reported the concession terms in Caracas on 10 November 2026\. - **Agence France-Presse** reported the vote and the sequence of sector openings the same day. - **Chris Wright** is United States Energy Secretary and visited Caracas in early September 2026\. - **ExxonMobil** and **PdVSA** signed a non-binding memorandum on 9 November 2026.

### What the title card says

\- Headline: build your own power, and the state can call on it. - Deck: Venezuela opened electricity generation to private and mixed capital, and the same law revokes a self-generator's licence if it refuses to supply during a declared state of exception. - Flag: National Assembly of Venezuela, sanctioned 10 November 2026\. - Article 64: admits private and mixed firms to generation, the opening. - Article 105: a self-generator above 2 MW refusing supply in a state of exception, licence revoked. - Oil companies: must secure their own continuous supply, self-generate. - Maximum private concession: 25 years, awarded by the Ministry of Electric Energy. - Concession threshold: 50 MW, generation above this needs a ministerial award. - At the end of the term: all assets revert to Corpoelec, free of encumbrances, nothing kept. - Status: sent immediately to the Executive for promulgation, not in force. - Chip: 105 is the article that revokes a self-generator's licence if it refuses supply in a declared state of exception. - Chip: 25 years is the maximum concession, and the plant reverts to Corpoelec, free of encumbrances, at the end of it. - Chip: 2021 is the last entry in the Assembly's own register of sanctioned laws, dated 14 December. - Source note on the card: Asamblea Nacional de Venezuela, its own account of the articles, 10 November 2026; concession terms from El Nacional, Caracas, the same date. The enacted text is not published.

## Frequently Asked Questions

Is Venezuela's reformed electricity law in force?

No. The National Assembly sanctioned it on 10 November 2026 and said it would be sent immediately to the National Executive for promulgation. Publication in the Gaceta Oficial follows promulgation.

Has Venezuela privatised its electricity sector?

The President of the Legislature said the law in no way promotes privatisation of the national electricity system. What Article 64 does is open generation and self-generation to private and mixed companies, which may obtain a commercial transaction on that electricity.

What is Article 105?

The provision under which owners of self-generation installations above two megawatts who refuse to supply electricity during a state of exception decreed by the National Executive face direct revocation of their administrative authorisation, in addition to any fine.

How long is a private concession, and what happens at the end?

Up to 25 years, awarded by the Ministry of Electric Energy where generation exceeds 50 megawatts or public-domain assets, trunk transmission, exclusive-service distribution or regionally integrated systems are involved. All assets incorporated, built or acquired during the term revert to Corpoelec, or a designee, free of encumbrances.

Does the law change anything for oil companies?

Yes. They must secure their own continuous and stable supply for their primary activities, by self-generation, cogeneration or third-party contract, and they need no state authorisation to generate for their own internal networks, only to interconnect to the national grid.

Is a state of exception the same as a state of emergency?

No. Under the Venezuelan Constitution an economic emergency is one kind of state of exception, alongside a state of alarm and a state of internal or external commotion. Article 104 of the electricity law names states of exception and emergency situations as separate triggers; Article 105 names only a state of exception.

How long can a state of exception last?

A state of alarm up to 30 days, extendable by 30 more. An economic emergency up to 60 days, extendable by an equal period. An internal or external commotion up to 90 days, extendable by 90 more. The National Assembly approves any extension, and the decree goes to the Constitutional Chamber of the Supreme Tribunal of Justice within eight days.

Where can the text be read?

Not yet in the Gaceta Oficial, because the law has not been promulgated. The Assembly's public register of sanctioned laws holds two entries, both dated 14 December 2021, and carries no Gaceta number for either.