WSHPDR_2013_Final_Report-updated_version

Electrification with Renewable Energies Programme
(US$6 million). 7 This programme has been managed
together with CNE, generating projects for rural
electrification.
In recent years, because of climate change, rising
carbon dioxide levels and the Renewable Energy Law,
mini hydropower and small hydropower projects have
become profitable and are planned and constructed
for interconnection to the grid as well as offgrid/isolated.
Some of the abandoned old mini
hydropower plants are in rehabilitation stage.
There are many irrigation channels in Chile which can
be used for mini and small hydropower plant projects.
These are being promoted by the National Irrigation
Commission (CNR) and CNE.
Small hydropower currently plays a flagship role in the
clean energy sector. The country has a significant value
chain for small hydropower, offering services in
turbine manufacturing, building, engineering,
operations and maintenance and power purchase. 9
Renewable energy policy
The Ministry of Energy (Ministerio de Energía) is the
Government organization for preparing policy for
promotion of Alternative Renewable Energy (ARE) or
Non-Conventional Renewable Energies (Energías
Renovables No Convencionales, ERNC). The promotion
is reinforced by means of the Renewable Energy Law
(Ley Eléctrica de Energías Renovables) and Electricity
Short Laws I & II (Leyes Eléctricas Cortas I y II). The
main promotion strategy with both laws is: free
energy transit through the interconnected electric
systems grid for small ARE plants of less than 9 MW
capacity and proportional transit fees for power
between 9 MW and 20 MW; the electric distribution
companies must purchase the energy generated by all
types of small ARE plants at a price fixed periodically
by the Ministry of Energy. 2 The ARE plants include
small hydropower, wind power, geothermal power,
solar photovoltaic (PV), alternative fuels (biogas,
biodiesel), tidal and marine power and thermal
biomass plants.
Today ARE generation is about three per cent in total.
Moreover, the generating companies must produce at
least 8 per cent of the total generated energy by ARE,
before the year 2020 and a further increase up to 10
per cent before 2024 is planned. 7
The Chilean Environmental Protection Ministry is
responsible for environmental protection. The
Environmental Impact Assessment (EIA) and the
Declaration of Environmental Impacts (‘DIA’ in
Spanish) are carried out and financed by the investor.
The environment assessment procedure has guidelines
on the following aspects:
Policy and Procedures for carrying out, obtaining
review and approval of environmental
assessments;
Guidelines for the preparation and review of
Environmental Reports (EIA and DIA);
Guidelines for public consultation;
Guidelines for sensitive and critical areas
(historical, archaeological and original people
sites);
Chilean environmental legislation and the
National Environmental Quality Standards.
All small hydropower development projects with
capacities higher than 3 MW and/or water flow higher
than 2m 3 /s follow the legal framework for EIA, which
forms an integral part of the feasibility study. 7 Smaller
projects only have to prepare an Environmental
Impact Declaration Report, much shorter than an EIA.
The Citizen-Technical Parliamentary Commission for
Policy and Electric Matrix (Comisión Ciudadana
Técnico Parlamentaria para Política y la Matriz
Eléctrica, CCTP), proposes structural changes to the
electrical development model, for optimization of the
administration and the institutions involved in the
Chilean electric market. One of the proposals is the
obligation for electricity generating companies to
deliver 20 per cent electricity from renewables by
2020, to ensure sustainable development with low
generation costs. Another proposal is an effort to
reduce energy consumption; the estimations said that
the electrical consumption of the country could be
reduced by 15 per cent by 2020. The potential of
renewable energy resources for the country is about
190,000 MW, which is 11 times the current installed
power. 8
Legislation on small hydropower
Laws 19940 and 20018 promote non-conventional
renewable energies such as geothermal, wind, solar,
biomass, co-generation and small hydropower. In the
first case, these types of energies can deliver the
generation to the grid free of transportation charges
below 9 MW and with partial payment between 9 and
20 MW. In the second case, law No. 20018 grants
project owners five per cent of the total electricity
distribution rights to meet the total demand for
regulated purchasers.
Barriers to small hydropower development
The main administrative barriers to small hydropower
development in Chile are:
Long lead times (about one to two years);
Too many state organizations involved in
authorizations and insufficient coordination
among them.
The main technical barriers to small hydropower
development in Chile are:
191