Chile watch: Legislators debate initiatives, Essa upgrade, fines

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Monday, September 8, 2014

Outlying regions to suffer most from price hike - senator

Chile's outlying regions will suffer the most from a decision by the energy ministry to raise consumer electricity prices, according to Lagos region (X) senator Iván Moreira.

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In a senate press release, Moreira said that his constituents' bills would rise more than 8% as a result of the rate hike. Moreira asked colleagues to try to stop the increase, scheduled to take effect in the fourth quarter.

Moreira warned that distributor Saesa, which serves 95% of residents in Lagos region and Ríos region (XIV), could be forced to raise prices for its Ríos clients by more than 15%, barring action.

Chile's lower house is reviewing legislation designed to reduce bid prices for power supply auctions, with the ultimate goal of lowering consumer electricity bills.

Legislator criticizes ministry expansion bill revision

Chilean legislator Luis Lemus, of the government's chamber of deputies, criticized a senate revision to a bill to install regional energy ministry branches in all 15 of the country's regions.

According to a chamber release, Lemus took issue with the removal of measures promoting citizen participation in energy projects and cooperation with indigenous communities.

The legislation must respect local communities, Lemus was quoted as saying, arguing that "no project can be developed, particularly in energy, without considering the people."

Feller upgrades Essa rating

Feller Rate raised its solvency and bond ratings for Chilean generator Essa to 'A-' from 'BBB,' citing the addition of the Los Vientos and Santa Lidia thermo plants to the company's generation park.

Essa, a subsidiary of AES Gener, has increased its installed capacity 57% to 750MW from 479MW in 2013.

The increase has allowed Essa to strengthen its individual credit profile and stabilize its revenue base, a Feller statement said.

Feller also cited a fuel supply contract signed in January with AES Gener in the decision to upgrade Essa.

FINES

Chile's supreme court ratified fines issued to power companies in 2012 for a countrywide outage in 2011.