Launching the government's energy agenda on 15 May, president Michelle Bachelet said the aim of the measures is to reduce costs on Chile's main grid from $151/MWh last year to around $106/MWh by 2017, a drop of 30%.
Renewable energy will play a key role in the growth of electricity supplies, the president said. It will account for 45% of new capacity installed between 2014 and 2025 as the country strives to fulfill its target of producing 20% of its electricity from renewable sources by that date.
Measures include redesigning tenders for long-term contracts to supply regulated clients so renewable energy projects can compete with conventional power plants and the development of short-term products to meet immediate demand.
Speaking at an industry conference earlier this week, Alfredo Solar, the president of Chilean renewable energy association ACERA said current tender rules do not cater to wind and solar power generation.
The government said it will also tender state land for the development of new projects and modify the rules governing the country's main grids to facilitate the connection of renewable energy projects.
Additional support will also be provided for the development of geothermal and solar energy.