Chile

Chile

Slower growth delays tender by six months

Chile has delayed its latest tender to supply electricity to regulated clients due to lower growth expectations.

Developers now have until November to submit bids (pic: Mainstream Renewable Power)
Developers now have until November to submit bids (pic: Mainstream Renewable Power)

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CNE, the country’s National Energy Commission, said potential bidders will now have until November to present offers, six months longer than originally planned.

The tender seeks to award contracts for 1.3GW of renewable projects, to start supplying power to households from 2025.

Massive unrest over rising living costs and social inequality in late 2019 dealt a severe blow to South America’s most prosperous economy, which is now expected to grow by just 1% this year, down from a previous estimate of 2.5%.

In response, CNE said it now expected demand for electricity to reach 33.87TWh by 2026, down 5.8% from its previous estimate, made in 2018.

Renewable projects, especially wind and solar power, have dominated Chile’s annual power tenders in recent years, helping to bring down long-term electricity tariffs from almost $130/MWh in the early part of the decade to less than $30/MWh in 2017.

Chile’s installed wind capacity is expected to more than double over the coming years to around 3.6GW, confirming its position as one of the leading markets in South America.

As well as household demand, renewable energy has been encouraged by a series of contracts between generators and major industrial consumers seeking to boost their green credentials and reduce energy costs.

In February, Canadian mining company Teck signed a deal with power firm AES Corp to provide half of the electricity required by its Quebrada Blanca copper project in northern Chile from renewables, including wind, solar and hydroelectricity.

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