Alejandro Vergara Blanco

/ Global Business Edition 2016

Chilean Act No. 20.936, which modifies the General Electric Services Act, was published on July 20, 2016. This act establishes a new system of electric transmission and creates a new independent coordinating agency for the national electric system. In general terms, the main modifications are:

New Coordinating Agency for National Electric System

This agency is a side effect of the interconnection between the two electric systems that exist in Chile. Now, with only one big electric system, a new coordinating agency is required. This agency is a public organ (the previous coordinating agency was operated by the electric companies) with the power to, besides coordinating the electric system, monitor the free competition in the electric market, the complying of the open access regime, and the payment chains between electric companies, among others.

Development Poles

As far as development poles go, there are areas that have a high concentration of renewable generation percentages, which are identified by the Ministry of Energy during the energetic planning procedure.

Energetic Planning and Transmission Expansion

The act promotes the creation of new transmission segments according to their functionality and restrictive technic criteria, creating the (i) National Transmission system (old Troncal system); (ii) Zonal Transmission system (old Subtransmission system); (iii) Dedicated Transmission system (old Additional system); (iv) International Interconnection system, which will facilitate the export and import of energy from or to the national territory; and (v) Development Poles Transmission system, which will facilitate the transport of energy produced by renewable sources located in development areas to the transmission system.

Concerning the energy planning, the act incorporates a new planning procedure that will be open every five years, led by the Ministry of Energy for a 30-year span.

Tracings Definitions

The act incorporates the possibility by the administration to define the tracings of the transmission installations, according to an economic, social, and environmental balance. Before this modification, tracings were defined by the transmission companies.

Open Access

The act extends the open access sphere of application to all transmission levels and brings new powers to the coordinating agency to apply rules, procedures, and stages in order to guarantee the open access.

System Remuneration

The act unifies the different installations qualification procedures, eliminating the speculation in fee procedures. Related to these modifications, the return guarantee of the investors is highly increased.

Legal Development and Regulation

The Energy Regulatory Commission (CNE) is highly powered by this act and is able to dictate technical and economic regulations and oversee the coordinating agency’s acts.