CHILEAN ENERGY

Droughts, unreliable gas imports, and protests against proposed projects have
hampered the Chilean power sector and its largest economic driver, the copper-mining
industry. Recent policies designed to foster more reliable supplies are a move in the
right direction, but remaining obstacles are formidable.
Chile is a country in dramatic need of a secure power supply. Developments in
generation and transmission have not kept pace with Chiles economic growth and only
energy-saving measures are preventing the grid from another collapse. To address this
issue, the government took an important step in February this year when it released a
new energy master plan. ts goal is to increase Chiles installed capacity base to !" #$
from %& #$ by !'!'.
(s a result of market-driven policies, Chile has had rapid growth since a popular
referendum put an end to (ugusto )inochets dictatorship in %*++. ,ince then, the
economy has posted average annual gross domestic product growth of ".-.. The !'%!
growth rate is forecast at ".*., and growth of -./. and -.". is e0pected in !'%/ and
!'%- respectively.
1ining, the engine of this economic success, is particularly affected by the lack of
reliable power supply.
1ines and mineral processing are huge consumers of electricity, and they suck up one-
third of the power generated in Chile. t is no wonder, therefore, that the supply of more
reliable and more accessible energy is at the top of mining companies agendas.
21ining companies operating in Chile suffer from two main problems3 high prices of
energy and the energy efficiency of their operations,4 said 5os6 7uis Fern8nde9 :ris,
general manager of Foster $heeler Chile, who recently signed a memorandum of
understanding with #; ;nergy. 2(s a general reference, the higher initial capital
e0penditure in a more efficient process is counterbalanced by lower operating costs.4
Chiles authorities have failed to spur ade<uate development of the power sector.
=ecurring droughts forced the government to change its focus from hydropower to
natural gas. #as-rich neighbor (rgentina sent part of its production to Chile, until
(rgentinean )resident >6stor ?irchner cut gas supplies in !''", driving the Chilean
market into chaos.
,ince then, the country has relied on cheap @coalA or <uick @dieselA generation sources to
cope with the growing demand for power, without a clear long-term strategy.
;ventually, )resident 1iguel 5uan ,ebasti8n )iBera came out with an energy master
plan aimed at defining principles for a renewed midterm energy strategy. This
confirmed the countrys commitment to thermal and hydropower while emphasi9ing the
importance of generation from nonconventional renewable energy @>C=;A sources and
showing willingness to connect Chiles two separate grids, the ,istema nterconectado
Central @,CA and the ,istema nterconectado del >orte #rande @,>#A. To date, no
follow-ups have emerged.
(ccording to Central ;nergCa, a think tank, and #eneradoras de Chile, the association of
Chiles biggest power generators, only %%. of the proDects that filed
for ;nvironmental mpact (ssessments @;(sA since !''/ are under construction. Ene
notable e0ception is the (ngamos )ower )lant, the !'%! PO!R)lant of the Fear,
developed by (;, #ener. This "!'-1$ coal-fired plant incorporates seawater cooling,
a desalination plant, and battery energy storage to supply reliable power to mining
companies in the Chilean desert. @,ee the profile of this plant in the (ugust !'%! issue
of PO!R or in the archives athttp3GGwww.powermag.com.A
(ll these factors lead to a market where supply struggles to match demand. n 7atin
(merica, only Hruguay has higher electricity prices. nvestments worth billions of
dollars are lining up, waiting for political commitment to clear the way of bureaucratic
headaches. The new energy master plan, the 2>ational ;nergy ,trategy,4 has been a first
step in this direction. n the field of renewable energy, approval of a proposed bill, the
so-called 27ey !'G!'4 @7aw !'G!'A, which sets a goal of !'. >C=; generation by
!'!', will pave the way for further developments, although the government seems to be
scaling down its ambitions on >C=; generation @see interview, belowA.
Interview with Sergio del Campo, Chiles Subsecretary for Energy
#lobal :usiness =eports @#:=A spoke with ,ergio del Campo @,DCA in 5une !'%!.
GBR :ig proDects are increasingly delayed by bureaucratic and legal troubles. $hat is
the government doing to smooth things overI
S!C The government supports all those proDects that comply with
Chiles environmental regulations. $hat Chile needs is an internal electricity price that
depends less on the global economy. (t the moment, the country is importing &". of
the fossil fuels it needs to generate electricity. For this reason, the government endorses
those big hydroelectric proDects that have the potential to decrease Chiles dependency
on imported fuels and also reduce CE
!
emissions. En the other hand, as thermoelectric
generation does not depend on climate conditions, it balances out low hydroelectric
generation in dry years in the J,istema nterconectado CentralK. t provides the country
with a safe and controlled power supply. ;mission rules in Chile are as severe as those
in the ;uropean Hnion.
GBR The government has announced an 2electric highway4 to speed up construction
of new power lines. Can you give us some more detailsI
S!C Ene of the most critical issues that Chile faces concerns the upgrade of its
transmission grid. Leavy delays affect the delivering of new transmission lines. )roDects
that should last %"' working days are taking between M'' and &'' working days. This is
why the government has already sent to Congress a bill that aims to lessen the red tape
on concessions and servitude rights.
En another note, we want investors to move forward their investment timeline. n order
to do that, we are drawing up a bill that modifies the way investments in power lines are
rewarded. Congress should be receiving it in ,eptember. (t the same time, the industry
authority CD;C-,C is putting out to tender N*'' million worth of power line proDects
in !'%!. That represents a steep increase from recent years, when tenders would not go
beyond N%"' million. $e can say that the sum of all these measures shape the concept
of an electric highway.
GBR $hat is the government doing to speed up the incorporation of renewable energy
into Chiles energy matri0I
S!C (t the moment, renewable sources generate no more than /.". of Chiles
electricity. Following the introduction of the law !'!"& during the former legislature,
power generators are obliged to introduce into the system increasing amounts of green
energy. ts ultimate target is to reach %'. of electricity from renewable sources by
!'!-. The system is bearing some first fruits. En top of that, the government has given
out around +' concessions for geothermal e0ploration to high-profile geothermal
companies. ( reform of the geothermal law is also under way so that investors can
enDoy a better legislative framework. $ith regard to solar energy, a public tender for a
"'-1$ solar pilot plant is due for ,eptember. En a broader level, we are thinking of
tendering small amounts of renewable energy every year.
"he #ew Energy $aster %lan
)resident )iBera unveiled the >ational ;nergy ,trategy in February !'%!. The plan rests
on si0 pillars3 energy efficiency, >C=;, traditional energy sources, transmission, market
competition, and regional interconnection.
The industry is waiting for the government to follow up on the master plan, though
uncertainties have slowed the agenda. =odrigo Olvare9, the minister of energy who
contributed to the strategy, resigned a few weeks after the master plan was announced,
after being sidelined from negotiations with protesters over the Lidro(ys6n proDect.
(lvare9 was the fourth minister to hold the position since !'%'. The current minister,
5orge :unster, is now tasked with implementing the strategy. The political risk
perceived within the ministry casts a shadow over government ambitions.
#o Country for Big %ro&ects'
The release of the energy master plan comes at a crucial time. ;nergy proDects crucial to
meeting growing demand are bogged down by delays in permitting, ;(s, and legal
processes.
2Chile is already running behind schedule because there are no big proDects reaching the
construction stage,4 said =en6 1uga, general director of #eneradoras de Chile. 2t can
take five to si0 years for a proDect to be ready. ;ven once the ;( has been approved, in
order to start building, you need to make sure that there will be no local opposition or
appeals to the ,upreme Court.4
The Lidro(ys6n proDect has been hitting the headlines for years. ( Doint venture
between Chiles main power generators, ;>D;,( and ColbPn, Lidro(ys6n consists of
five dams in the region of (ys6n. t would provide the ,C with an additional !,&"'
1$ of installed capacity, representing !'. of the current generation base. 7ocal
communities, only partially involved in Chiles economic development, felt abused by a
proDect tailored for the needs of distant centers of consumption, causing them to protest
and spurring new delays.
Hncertainties also remain about linking the proDect to the ,C. Eriginally, the plan was
to build a transmission line up to ,antiago, covering appro0imately !,''' kilometers
@kmA. Lowever, a shorter option to the area of )uerto 1ontt @%,''' kmA is now being
assessed.
2$e still have the uncertainty of where we can inDect those five plants,4 commented
5ulio 1ontero 1ont6gu, Lidro(ys6ns technical director. 2This doubt prevents us from
moving forward <uicker.4
( few weeks after our interview, ColbPn put the whole proDect on standby by
announcing the suspension of the ;( for Lidro(ys6ns transmission. (ccording to the
company, 2as long as Chile lacks a shared energy strategy which details the
characteristics of the countrys future energy matri0, ColbPn thinks that there is no room
to develop such big and sophisticated proDects.4
n an interview with #:=, the subsecretary for energy of the Chilean government
reaffirmed the governments commitment to follow the master plan with an 2electric
highway4 that should clear the way for building the Lidro(ys6n transmission line.
#iven the circumstances, in the best-case scenario, Lidro(ys6ns five dams will not
operate before !'!'.
;<uipment suppliers are following developments closely. 2$e are very close to some of
the new proDects, like Lidro(ys6n and ;nergCa (ustral,4 said 5ohn E,hea, e0ecutive
director of =TLE, a company speciali9ed in supplying the market with e<uipment for
high-voltage lines. 2Hnfortunately, the schedule has changed from time to timeQ last
week we had a meeting with ;>D;,( for the five hydro plants in the southern part of
Chile, and the details were <uite different from what we knew about three months ago.
$e are looking at that proDect an0iously, because it is important for us and for the
economy of our country. $ith its delays, it is attracting a lot of interest from
international contractors.4
The scale of such proDects provides both opportunities and challenges for service
providers. Chilean engineering company )och Doined efforts with ,$;CE and ;), to
shape the final ;( study for Lidro(ys6ns five dams. 2The study for Lidro(ys6ns
power plants, a document of over %',''' pages, was one of the largest completed in
Chile,4 said 1iguel ,anche9, managing director of )och. 2ts undertaking re<uired the
management of over !'' specialists. t is risky to allocate more than !". of your own
resources on a single proDect, so when working on a proDect of such immense scale, we
looked for partners to share the risk of investment and capital re<uirements. :y working
with ,$;CE and ;),, we were able to manage this risk and carry out all of the studys
re<uirements.4
En paper, there are no doubts that Lidro(ys6n is a game-changing proDect. Lowever,
the actual timeline fosters doubts. 2f it is going to be ready in !'!', Lidro(ys6n cannot
serve the needs of the demand in the short term,4 said ,amuel 5erardino, associate
director of ?(,, a local engineering company. 2(t the same time, it is foreseeable that
solar energy will be a much cheaper source of energy than Lidro(ys6n will be in !'!'.4
Lidro(ys6n is not the only proDect e0periencing difficulty. ,oon after ;nergCa (ustralR
a Doint venture between the ,wiss mining company Sstrata and (ustralian power
generator Erigin ;nergy that is planning to construct three additional dams in the region
of (ys6n for some %,''' 1$Rreceived the green light for its proDects ;(, the
,upreme Court asked for additional studies to be carried out. ,ome /,''' km north, the
future of another massive proDect hangs in the balance. 1)S, the :ra9ilian group
chaired by magnate ;ike :atista, is e0periencing delays at its Castilla proDect. The
!,%''-1$ coal-fired plant had received approval for its ;( when the appeals court of
(ntofagasta threw everything into Deopardy following an appeal by local communities.
The pu99le got more comple0 when Chile endorsed the nternational 7abour
Ergani9ation Convention >o. %M*, dealing with the rights of indigenous peoples. 2That
has been an important step for the country, but the fact that the government has not yet
defined how to apply the convention creates much confusion,4 said 1ario 1archese,
energy director 7atin (merica of Latch. 2Companies have to interpret the scope of the
convention all the time. Latch can support them in the developing of specific activities
with local communities to make them part of the proDect. 7ocal communities have to be
informed and supported through these specific actions4 @Figure %A.
Despite unclear rules, good practice has allowed several proDects to develop
successfully. 2Lidromaules 7ircay proDect is uni<ue because of our approach to
community and environmental issues,4 says Carl $eber, managing director of
Lidromaule.
The companys 7ircay proDect @a !'-1$ run-of-river hydro plantA was listed as one of
the %'' most important infrastructure proDects worldwide in !'%! by "nfrastructure
#ournal. 2n Chile, hydropower proDects are normally awarded nonconsumptive water
rights, so Lidromaule made an arrangement with the local channel association to use
their consumptive water rights. Lidromaule paid royalties to the associations /,M''
members for the use of the water, which lowered their yearly e0penses. $e also
performed the necessary repairs to the channel. $e made sure to provide them with the
solutions they re<uired.4
,till, the costs of the aforementioned delays are impressive. $a %ercera, a ,antiago
newspaper, has estimated the amount of investments destined for the Chilean power
industry hanging in the hands of local communities and tribunals at over N%+ billion.
( !istorted )ree $ar*et
Chiles economic growth has outpaced its ability to enhance generation, forcing a
reliance on diesel generation. 2The dispatch of different generating technologies is
based on economic merit and demand,4 said =odrigo Cienfuegos, managing director of
;nergy )artners @;)CA, a diesel backup generating company. 2:ecause diesel is
e0pensive, it is dispatched at the end of the demand curve, when there is very heavy
demand or a shortage of cheaper generation like water or coal. $hen ;)C started up,
we e0pected to run the engines an average of "'' to &'' hours per year. :ut due to
Chiles energy crisis, the need for backup generation has greatly increased. ;)C
currently has an average dispatch of /,"'' hours, which is four to five times more than
what was budgeted for.4
(longside backup generators, the combined cycle infrastructure developed when
(rgentina was e0porting natural gas to Chile now runs on diesel and li<uefied natural
gas @7>#A and accounts for one-third of ,C generation.
This is an e0pensive path to follow. Diesel and 7># must be imported at high prices. n
Chiles power market, based on the concept of marginal cost @where the last unit of
energy dispatched determines the priceA, this has resulted in prices spiking. (ccording to
figures published by the Erganisation for ;conomic Co-operation and Development
@E;CDA, electricity prices in Chile posted a four-fold increase between %**+ and !'%%,
reaching N!"M.-G1$h, way above E;CD countries average price of N%"*.-G1$h.
#iven this, H.,. shale gas may prove a game-changer. $ith the H.,. possibly starting to
e0port 7># in a matter of years and the )anama Canal soon ready to allow the transit of
7># ships, Chile can look at H.,. gas as a feasible alternative to (rgentinean gas.
#as (tacama, a company that runs a /&'-1$ combined cycle power plant in the
(tacama region, recently announced investments of around N-'' million in an offshore
7># regasification terminal in the 1eDillones :ay. 2$e have been negotiating contracts
to have a li<uefaction facility within the two H.,. terminals, Cheniere and Freeport, that
are set to become e0porters,4 said =udolf (raneda, managing director of #as (tacama.
2The idea is to have the gas transported to Chile, to have the infrastructure to regasify in
front of our plant, and connect the gas to our pipeline. (ll of this is subDect to securing
power purchase agreements @))(sA with minesQ our contracts for these are coming to an
end and are based on previous fuel supplies.4
The timeline of the proDect, according to (raneda, is almost 2perfect.4 2The first H.,.
gas e0ports will probably be in !'%MQ the )anama Canal e0pansion will be completed
around the end of !'%-Q the mines will re<uire the power e0pansion in !'%M or !'%&.
$e need /' months to build the Jfloating storage and regasification unitK, so it will be
ready in time.4
Renewables
Ligh prices can be a blessing, especially for renewable energy developers. #eneration
from >C=; in Chile is stuck at M"" 1$, evenly split among wind, biomass, and mini
hydro. (lso, taking into account the additional /M- 1$ under construction @/%" 1$ in
wind power and -* 1$ in mini hydroA, the contribution of >C=; to the generation
portfolio does not go beyond ".&.. Lowever, with the costs of renewable energy
falling, green energy pioneers increasingly look at spot markets to make their ventures
competitive.
Lidromaules Carl $eber was among the first developers to go on the market when he
chose to take on risk for the !'-1$ 7ircay hydropower plant in !''+. That choice paid
off, and today the company turns over N%+ million and has reinvested part of the cash
flow in another %--1$ run-of-river plant, )rovidencia, due online by ,eptember !'%!.
2Chilean small hydro potential is over %',''' 1$,4 said )edro 1atthei, president of
(pemec. 2n the ne0t %! months %,''' 1$ of new mini-hydro proDects will be filing
for an ;(.4
Ethers are following suit. $ind power developer 1ainstream closed a deal with
Chinese wind turbine producer #oldwind to go on the spot market with its >egrete @//
1$A and Ckani @!-' 1$A wind farms, planning to commission them by 1arch !'%/
and 1arch !'%- respectively. :oth are e0pected to show a capacity factor of over /!..
2There are no structural reasons that can determine a sudden drop in the electricity
prices,4 commented 5os6 gnacio ;scobar, 1ainstreams managing director for Chile.
2The demand is growing more than the new capacity added to the systemQ hydropower
generation suffers from serious droughtsQ all the big proDects are being delayed for
social and political issuesQ last but not least, Chile does not have indigenous fossil fuels,
and this leads the country to take on a big fossil fuel price risk. (ll in all, the spot
market is the ideal marketplace for renewable power developers, at least for the
moment.4
,ervice companies are broadening their range of offerings to cope with the demands of
these renewable players. =TLE, for e0ample, brings its e0pertise in high-voltage line
e<uipment and services to the wind sector. 2$e have been active in all the wind farms
already constructed in Chile, but only in the area of pre-inDection of power to the grid. t
is a very small segment, although we have to remain interested,4 said E,hea, the
companys e0ecutive director.
,till, factors such as distant transmission lines can hamper profitability and increase
risk. n these circumstances, developers must turn to Chiles big private consumers to
secure a buyer for the energy they produce. 2$ithout a ))( renewable energy
developers struggle to move forward because neither banks nor investors would endorse
a strategy oriented at the spot market,4 said (lfredo ,chilling, managing director of
ntervento, a wind power developer.
$hen it comes to securing ))(s, mining companies are the top choice. Lowever,
differences between the offer and demand make renewable ))(s difficult to structure.
1ining companies have high load factors spread over !- hours a day, which cannot be
met by Dust wind and solar power. To overcome this challenge, developers are designing
more sophisticated contracts. 2$e need to find a way to combine renewable energy
generation with backup generation. n this way, we can back up our generation at any
time.4
Fet this risks making their offer less competitive. 2:esides wind or solar energy costs,
you have to add the cost of the diesel generator that is working M'. of the time, because
they have a capacity factor that does not go beyond /'.,4 said ;lectroconsultores
e0ecutive director Francisco (guirre.
>onetheless, uptake of these hybrid options is increasing. 2Latch can leverage its
e0perience and suggest blended solutions that take into account a combination of
renewable energy with generation from conventional sources. Lybrid plants are more
efficient in terms of diesel or gas consumption and show an environmental
consciousness without compromising on the safety of the energy supply. (s a reference,
Latch is working with Codelco for a !"'-1$ wind farm in Chu<uicamata and with
other mining clients looking for opportunities to implement renewable sources,4
e0plained 1archese.
=enewable energy developers may receive legislative support from the 7ey !'G!'. This
law, already approved by the upper chamber of Congress and waiting for a green light
from the lower chamber, aims to re<uire !'. generation from >C=; by !'!' through a
publicGprivate mechanism that should guarantee a price for green energy over a %!-year
period.
=egardless of their business model, solar power developers find an ideal setting in
Chile. The desert of the (tacama region boasts world-class levels of irradiation, and
solar developers coming from around the world are concentrating efforts in the area. ,o
far, ambitions have not been matched by real breakthroughs, but developers are piling
up proDects, waiting for the right time.
,panish ,olarpack sealed a deal with Codelco to put up a %-1$ solar photovoltaic @)TA
pilot plant in Calama. 2Calama ,olar / is going to be the first active power plant in the
country,4 said 5on ,egovia de Celaya, director of ,olarpack. 2$ith a /%. capacity
factor, it will be the most efficient solar )T plant in the worldQ secondly, it will work at
grid parity, with an electricity price ranging from N%''G1$h to N%"'G1$h. The sale of
the electricity generated there has already been secured through a ))( with Codelco.4
$ith this first proDect, ,egovia de Celaya e0pects 2to unleash a UCalama effect4 and
have more mining companies closing ))(s. (nglo (merican and Sstratas copper mine
at Collahuasi is already in the process of tendering M' #$h per year for supplies from
renewable energy proDects.
Geothermals +ntapped %otential
Chile has one of the largest underdeveloped geothermal resources in the worldQ its
potential could go from 9ero to %M,''' 1$ over a "'-year period. Lowever, only three
developers have been granted an e0ploitation concession following successful
e0ploration campaigns3 ;nel #reen ;nergy for its Cerro )abellVn development @inferred
resources for "' 1$A, #eo#lobal;nergy @##;A for Tolhuaca @&" 1$A, and 1agma
;nergy for 7aguna del 1aule @"' 1$A.
(t the moment, ##; is the only company actively drilling and defining the geophysical
and geochemical characteristics of its Tolhuaca development. 2There is no geothermal
development in 7atin (merica,4 said =Wdiger Trenkle, ##;s managing director for
Chile. 2$e are pioneering, which means that we are taking on additional risks because
there is little e0perience on geothermal resources in the region.4 Trenkle plans to have
two more seasons of drilling before getting to the construction stage and estimates the
plant will be running by late !'%M.
1agma ;nergy has a similar timeline for 7aguna del 1aule. (t the moment, the
company is looking for a partner to carry out further drilling, beginning in the summer.
2(s yet, the country does not have service and drilling industries to support significant
work, so one of the challenges is to ratchet up the activity here to sustain them,4
e0plained 5ohn ,elters, 1agma ;nergys managing director for Chile. 2n this sense, the
H.,. and other countries have more going for them, because these supporting industries
reduce costs. n the central part of Chile, all the necessary e<uipment is not available to
be brought out on a days notice by a service company. nstead, you have to have it
standing by on your proDect, which is very e0pensive.4
#eo;strella, a Doint venture of drilling companies #eotech and ;strella, is the only
drilling company supporting geothermal developments. 21ost of the players active in
geothermal right now are the larger players,4 said 1atthew Loldeman, managing
director of #eo;strella. 2Those that we hope will start becoming active towards the end
of this year and ne0t year are more of the medium-si9ed companies, like Transmark
=enewables from ;uropeQ Ermat, based in the Hnited ,tatesQ ;DC from the )hilippinesQ
and a number of companies based out of >ew Xealand.4
)hilippines ;DC is already active through a Doint venture with Lot =ock, an (ustralian
e0ploration company with si0 plays in Chile. 2Lot =ock is a /'. partner with ;DC in
its proDects in Chile and )eru,4 said )eter :arnett, managing director of Lot =ock. 2The
Doint venture deal has brought N% million per proDect back into Lot =ock, so we are
getting a cash receipt from ;DC of N/ million. $e take a cooperating role in the Doint
venture through the drilling of these first si0 wells during which we will monitor
progress, provide technical support, and co-manage each proDect.4 :arnett added3 2$e
are e0pecting to commence drilling in !'%/.4
To unleash Chiles geothermal potential, things must be developed on a legislative level.
2#eothermal is a very attractive power source, but it has a high front-end risk, which is
not usually built into a power companys business model, and the private risk capital
companies, like us, have not been very present until recently,4 said 1agma ;nergys
,elters. 2Ene e0planation for this could be that there is some administrative discretion
with regard to the development of concessions. (fter e0ploration, you theoretically
prepare a production plan, which can be accepted or deniedQ it is possible that the plan
of an investor who has spent a lot of money will be reDected by the authority of the
time.4
"ransmission Blues
Chiles grid is its weakest link. 7ines are overwhelmed and bottlenecks are often to
blame for blackouts. $hereas the ,># is stabili9ing around an e<uilibrium between
demand and offer, the ,C still has a long way to go. 2The real problem is to bring
electricity from the south to the central part of the country, something the grid is not
always able to ensure,4 said =odrigo Castillo, e0ecutive director of ;mpresas ;lectricas.
2That implies e0posure to blackouts and to very high prices.4
The government is tendering new lines3 !''-kT and "''-kT lines worth N*'' million
are being tendered in !'%!. Lowever, investors are cautious because the necessary legal
setting is still under development, paperwork is comple0, and local communities often
affect outcomes. 7ast 1ay a tender aimed at enhancing the system in the area of
,antiago was ignored. The government is trying to address the problem and will present
to the Congress the proDect of an 2electric highway4 ne0t ,eptember.
This electric highway will pave the way for the interconnection of the two main grids.
2t is necessary to link the ,C to the ,>#,4 said Tictor Lugo Flores, managing
director of :bosch, an engineering and manufacturing company speciali9ing in
transmission lines @Figure !A. 2There is no doubt that this is going to determine a better
e<uilibrium between generation and demand. ;lectricity generated in the north could be
sent south and vice versa. This is definitely the way to move forward to serve the
growing demand rising from the mining industry.4
This will pose technical challenges. 2,C-,># interconnection would ensure a cleaner
energy market overall, allowing mines in the north to buy hydro energy from the ,C,
although this would come at the cost of a less clean energy matri0 for the ,C,4 said
;ric (humada, Transelecs vice president of business development. 2n order to achieve
interconnection, however, technology needs to be taken into account. The ,># uses
thermal energy and the ,C uses hydro, and the rules for their operation are different.
The interconnection will need to be very strong to allow the transmission of power
without oscillation in case of contingencies. f we opt for synchronous connection, it
will have to be very strong. Etherwise, an asynchronous interconnection using LTDC
technology can facilitate energy e0change, allowing the systems to remain separated
and respond to their local dynamics.4