PRESS RELEASE

Chile: Electric tender breaks record and exceeds expectations of the government and the market

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Tuesday, October 31, 2017

Press release from

Ministry of Energy of Chile

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The Minister of Energy, Andrés Rebolledo, together with the Executive Secretary of the National Energy Commission, Andrés Romero, and the Executive Director of the Association of Electric Companies AG, Rodrigo Castillo, today led the opening and inspection of the economic offers presented by the 24 national and foreign generators that are participating in the 2017/01 Supply Tender process, which offered 2,200 GWh / year of energy and will supply the electricity needs of the regulated customers of the National Electric System for 20 years at from the year 2024.

This Supply Bid is the third carried out by the Government with the new Bidding Law No. 20.805 and considers seven Supply Blocks, composed of the blocks N ° 1-A, N ° 1-B and N ° 1-C, amounting to 1,700 GWh, and quarterly blocks No. 2-A , No. 2-B, No. 2-C and No. 2-D, totaling 500 GWh of energy, all effective as of January 1, 2024 until December 31, 2043.

In this Opening of the Economic Offers, the companies presented prices that start at 21 , 48 US $ / MWh and that envisage an average price that will be below the 47 US $ / MWh at the end of the last tender of the year 2016. Average price will be known on Thursday, November 2.

All in all, the prices offered show strong competition among energy generating companies and have exceeded the most optimistic forecasts of the authority and the market.

The Government highlighted that four years ago the last tender of the previous administration exceeded US $ 128 / MWh.

The Minister of Energy, Andrés Rebolledo , said that "we are satisfied, because today we have experienced another historic and important moment in Chile's electricity sector, which is the result of the political will of President Bachelet's government to change the regulatory framework and conditions of the electricity tenders to develop a competitive market that has incorporated new players, has lowered energy prices and massively incorporated renewable energies.The offers we present today and the low prices are excellent news for Chile, for its economy, greater productivity and competitiveness and for the households in Chile that will benefit from these better prices and lower electricity bills ".

The Executive Secretary of the National Energy Commission, Andrés Romero, said that "we have broken all the records we had in our country in relation to the prices that are being offered in terms of energy, this is a historical price. offers for 21, 24, 25 or 26 dollars These prices are tremendously good news for the industry and for Chilean families because we will be able to continue taking advantage of the clean energy that our country has in abundance. "

For his part, the Executive Director of the Association of Electric Companies AG, Rodrigo Castillo, added that "whoever has won today is the competition, therefore, it is the country and the clients that will definitively begin in the next decade. to see in a very determined way substantive reductions in the cost of energy, and again the fact of having a room overflowing, having a huge amount of offers for a tender is a reason for immense satisfaction. "

Within the framework of the new Tenders Law (No. 20.805), the National Energy Commission is responsible for designing, coordinating and directing the public bidding process for this year, which aims to provide electricity distribution companies with contracts for long-term supply to satisfy the consumption of its customers subject to price regulation (consumers and SMEs).

In this process, in particular, the main changes in the bidding process were the design of the blocks , incorporating the concept of quarterly blocks, the possibility of making bids for energy ranges , the two-stage allocation mechanism and the increase of the ballots. of guarantees, doubling the amounts of the guarantees of seriousness of the offer (200 UF / GWh) and faithful fulfillment of the contract (600 UF / GWh). Likewise, the process requires bidding companies to submit a Risk Rating Report with follow-up and physical support of the offer.

According to the program defined in the Bidding Terms, on Wednesday, October 11, 24 national and international generating companies presented their bids for a total of 20,700 GWh, 9.4 times as demanded in this tender.

On Thursday, November 2, the public act of awarding said bids will take place, where the bidding companies will be officially announced and the final average price of the process.

List of the 24 Bidders:

1) Colbún SA

2) Acciona Energía Chile Holdings SA

3) Ibereólica Cabo Leones III SPA

4) Cabo Leones I SA Wind Farm

5) GPG Solar Chile 2017 SPA

6) Vientos del Pacífico Wind Farm SPA

7) Photovoltaic Norte Grande 1 SPA

8) Atacama Energy Holdings SA

9) Cerro El Plomo SA

10) Likana Solar SPA

11) Enel Generación Chile SA

12) Mas Energia SPA

13) Mainco SPA

14) Hidromaule SA

15) Renewable Energy Summer Three SPA

16) Rakun SPA

17) Cox Energy SPA

18) KDM Energía SA

19) Amunche Solar SPA

20) Besalco Energía Renovable SA

21) Atacama Solar SA

22) Energias Calbuco SA

23) Energía Coyanco SA

24) PE Piedra Amarilla SpA

Communications

Electric Companies AG

22 2036427

www.electricas.cl

This press release was published using an automatic translation system.