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Published : 04 May 2026, 11:24 PM
When potential providers and financiers for Venezuela's electric industry, including Siemens Energy and GE Vernova, held meetings with officials in Caracas in April, questions of how they might get paid to shore up the country's deteriorated grid were top of mind, two sources involved in the talks said.
Those executives came away hesitant, the sources said, as the nation tries to jumpstart a $100 billion reconstruction plan pushed by Washington.
Securing stable electricity is among interim President Delcy Rodriguez's top priorities since she replaced deposed President Nicolas Maduro in January, but the cash-strapped country has so far failed to guarantee timely payments to suppliers that would help key industries - like its oil-and-gas sector - recover.
"I returned very sceptical from Venezuela," said an executive from an equipment provider that worked with the government and state energy firm PDVSA, who attended one of the Caracas meetings. "The power plants have not been properly repaired in 10 years, so the needs are almost infinite. But they still have no clue on how we would get paid."
Less than 40 percent of Venezuela's generation capacity is currently available, leading to frequent outages and limiting the nation's manufacturing capacity. The country's thermal plants were expanded under late President Hugo Chavez through 2013, but the projects left billions of dollars in unpaid bills to contractors, some of whom are now being asked to return.
A lack of clarity over which projects will be prioritised and supplies needed to reinforce the country's transmission lines and fix its thermal and hydroelectric plants remains. That, coupled with uncertainties about payments and authorisations needed from Washington and Caracas, will delay investment, the sources said.
Venezuela's communication ministry, state utility Corpoelec, and state-run oil company PDVSA did not reply to requests for comment.
No Payment Solutions in Sight
Following the April meetings with foreign executives, Rodriguez's government approached firms including Siemens Energy, GE Vernova and Mitsubishi Power about repairing the grid.
Siemens Energy and GE Vernova confirmed meetings with government officials. "We are motivated to meet the moment in supporting the people of Venezuela," a spokesperson for GE Vernova said. Mitsubishi Power did not reply to a request for comment.
Of the 36,000 megawatts (MW) of Venezuela's installed generation capacity, less than 13,000 MW are currently available, mainly due to the bad condition of its fuel-powered plants, which are only contributing some 2,500 MW, or about 13 percent of their capacity, according to independent data.
Rodriguez has not elaborated on her plans, saying early efforts are focused on repairing two large thermal plants that have been underperforming for years.
"Solutions won't come overnight," she said last week in a rally in Valencia, one of many cities hit by frequent power cuts.
The experience of multinationals from the Chavez era has made some wary about returning to Venezuela. Several companies who went unpaid filed for arbitration or resorted to legal action abroad after taking promissory notes Venezuela gave them instead of cash. Many traded those at large discounts.
None did further work in the ensuing years, in part due to US sanctions that are now being eased.
Rodriguez's government recently rejected a proposal from a group of foreign firms seeking to be prepaid for initial repairs and spare parts, citing legal obstacles, according to the source.
Some proposed getting direct payments from US Treasury-supervised accounts that are collecting the country's oil sale proceeds, said an executive from a potential financier.
Venezuela also has existing debts with multilateral institutions and banks, another obstacle for financing, the sources said.
Lengthening Blackouts and Rationing
The power issues have hamstrung Venezuela's oil and gas sector, its most important industry.
At the Paraguana Refining Center, one of the world's largest with 955,000 barrels of daily installed capacity, several blackouts this year have prevented PDVSA from restarting gasoline-making units. That has delayed distribution, leaving long lines of drivers waiting for fuel.
PDVSA is assessing its needs for repairs and equipment, one of the sources said. But the company he represents "won't repeat past mistakes," he added, referring to its position on extending any credit to Venezuela.
At least $15 billion is needed to repair the grid through a three-year stabilisation plan. Without it, only minor repairs will be made, according to power expert Miguel Lara. "It's a very complex problem, a puzzle," he said. "I don't know which power supply will support the economic reactivation they are talking about."
Demand last year was 14,700 MW, leaving a deficit of at least 1,500 MW, Lara said. The grid had 35 large outages in the first quarter, compared with a historic average of three to five events per year. Theft and misuse of spare parts are also contributing to the infrastructure problems, he added.
Bernerd Da Santos, executive vice president at US utility AES, warned at an online conference in March about the urgent need to reinforce Venezuela's transmission lines. If the government adjusts tariffs to ease subsidies and provides legal certainty for contracts, investment could be possible, he said.
Some energy producers, including Spain's Repsol, have already launched open requests to source their own power plants and related supplies, a company document seen by Reuters showed. Repsol did not reply to a request for comment.
Residents, meanwhile, endure increasingly long stretches without power, sometimes up to 10 hours a day.
In the western city of Maracaibo, Venezuela's second-most important after Caracas, a group of young men often play basketball on an old court illuminated only by a motorcycle headlight.
"We used to play here every day, but rationing is growing," said 20-year-old student Fernando Urdaneta. "At least this way we don't stop exercising, don't get bored and escape the house, which turns into an oven."
