Chilean water utilities brace for tough dry season

Chilean water utilities are facing a pessimistic outlook for water availability during the current summer season, as rains fell below average during last year in many of the country's main water basins, resulting in water levels declining below 50% of their averages in some rivers, forcing firms to step up infrastructure investments.

According to the full water provision report from utility association Andess, the initial figures of which were previewed in late December, the country's 14 main water utilities spent a total of 101bn pesos (US$148mn) on infrastructure improvements and other items to secure water provision in 2018, up from nearly 62bn pesos in 2017.

Over half of the investment (53bn pesos) was made by Grupo Aguas, which includes Santiago's main water utility Aguas Andinas, mostly for the construction of new storage tanks in Pirque municipality, on which the firm spent 38.1bn pesos last year.

Other major investments from Aguas Andinas in 2018 included the ongoing construction of the Chamisero plant (3bn pesos invested last year, 12bn pesos in total investment required).

That project is expected to be finished this year, increasing the autonomy of the capital's water system to 34 hours in case of emergencies. However, in 2017 Ronaldo Bruna, head of water regulator SISS, said that these works may not be enough, just as Aguas Andinas was facing heavy criticism of its handling of water emergencies.

Outside of Santiago, Aguas Antofagasta, which serves the northern region of Antofagasta, spent 22bn pesos on water security works, more than doubling the 8.8bn pesos invested in 2017.

Works by the northern utility included expanding the capacity of a desalination plant and opening a new 6,600m3 reservoir. In total, 18bn pesos were invested in potable water production works.

Now, Aguas Antofagasta faces a change of ownership, as its main shareholder, Colombia's EPM, will sell its stake in the utility as part of its efforts to improve its figures following the Hidroituango crisis in that country.

In this regard, EPM CEO Jorge Londoño told local daily El Colombiano that this operation is expected to be finished in the third quarter of 2019.

Despite the increased investment, Andess noted the presence of 12 areas that "will or could require reinforcement and/or potable water sourcing through alternative options," such as tanker trucks. On that front, it was noted that most of the areas at risks are at the central-south regions of Ñuble, Maule and Biobío, although this is something of an improvement from the 14 areas that were expected to require alternative water supplies in 2018.

These three regions are served by Essbio and its contractor Nuevosur, which invested 4.3bn pesos in 2018, up from 3.9bn pesos in 2017.

The full report, listing the investments made by each utility, can be seen here, in Spanish.