Chile energy minister, electricity traders discuss non-regulated market entry

Chile’s association of electric power traders (Acen) reflected positively on a meeting (pictured) with energy minister Diego Pardow to discuss a requested sector rule amendment.

A central objective of Acen is getting authorities to lower the threshold for entrance into the non-regulated power market, a move it says would benefit thousands of SMEs by helping shrink their electricity overheads.

Association officials highlight that current legislation allows the barrier to be lowered by the ministry following a report from the competition court – instead of requiring a change to the text via a bill.

“We are grateful for the receptiveness shown by minister Pardow with regard to the activation of the mechanism that would permit SMEs, in a relatively short period, to access more services and lower costs in their payments for electricity,” Acen head Eduardo Andrade told BNamericas. Andrade added that the alternative, introducing and fully implementing a bill, would take several years.

Ministry officials indicated the proposal would be explored. 

Non-regulated clients are currently deemed companies that are connected to more than 500kW of installed capacity and have opted for that classification, or those connected to more than 5MW of capacity. Those below the 500kW threshold have no choice regarding their power provider.

Even if the barrier was lowered to 400kW, the potential market would be around 47,000 SMEs.

Other objectives of Acen, as part of a push to spur competition and help support decarbonization, include incorporating the concept of energy trader into the distribution facet of the general law of electric services.

Associated areas traders could enter include energy efficiency and storage.

In a context of work to support the energy transition, the ministry is also drafting transmission legislation and measures to debottleneck permitting processes.