ACERA meets with Bancada Eléctrica and addresses the positive impact of renewable contracts on electricity rates

This is an automatic translation of the original release issued in Spanish

PRESS RELEASE from Acera
June 24, 2024

Santiago, June 24, 2024.- This Monday, the "Electrical Bench" met online with the Chilean Association of Renewable Energies and Storage (ACERA) for an information session. The meeting, held during the "district week" of the deputies, was attended by Ana Lía Rojas, executive director of ACERA, and the deputies Marisela Santibáñez, Marcela Riquelme, Rubén Oyarzo, Jaime Araya, Joanna Pérez, Yovana Ahumada, Miguel Ángel Calisto, Boris Barrera and Marlene Pérez.

During the session, ACERA presented on the renewable energy contracts implemented since 2015, highlighting how these agreements have contributed to mitigating increases in electricity rates in Chile. The differences between older and more recent contracts were discussed, highlighting the economic and sustainability benefits that renewable contracts have brought to the electricity sector. However, according to the design of the tenders, the companies that win the tenders begin the supply of energy after five years, so since 2020, the NCREs have progressively begun to participate in these contracts. As a consequence, the relative participation of new NCRE contracts in the total supply contracts to households in Chile today reaches only 28%. In the month of October 2023, for example, the average price of regulated contracts, awarded in 2015 and based on NCRE, was 59.4 $/kWh, while the average price of the supply of old contracts was 108.7 $/kWh.

In addition to analyzing the positive impact of renewable contracts, ACERA presented the current complexities facing the renewable energy industry in Chile. These difficulties include regulatory challenges for the greater insertion of renewables into the electrical grid and thus avoid the dumping of NCRE, permits and also financing, which affect the implementation and development of renewable projects in the country.

The executive director of ACERA, Ana Lía Rojas, highlighted the importance of continuing to promote competition in the electricity sector through the integration of more renewable energies. "Renewable contracts are helping to moderate increases in electricity rates for Chileans, and are also promoting greater competition in the country's electricity market, which is beneficial for all consumers," said Rojas. The topic was addressed from the perspective of what would have happened to the electricity rate, in a scenario of outbreak and pandemic - origin of the stabilization of rates and debts with the generators - without the participation of non-conventional renewable energies in the energy supply. to the homes of Chile.

The deputies of the "Electric Bank" reaffirmed their commitment to seeking solutions to the problem of the imminent, considerable and successive increases in the electricity rate announced for July and the coming semesters, which will reach 57% in 2025 according to the Central bank. Additionally, they committed to continue working on policies that support the sustainable development of the energy sector, highlighting the need to address and resolve the complexities facing the renewable industry.

Marcela Riquelme expressed that, after this meeting, "we are even clearer about which contracts help mitigate the increase, as well as those that increase the electricity rate, and that it would be necessary to review to find a definitive solution to the considerable increases announced. ”.

Marisela Santibáñez commented on the specific problems faced by some electricity contracts: "We have a big problem with indexers to fossil fuels in some electricity contracts. This point must be taken into consideration for a solution to the issue of electricity rates."

Marlene Pérez pointed out the need to look for comprehensive solutions: "We see that the renewable industry is having problems, and so are families. Comprehensive solutions must be sought."

Jaime Araya highlighted the situation in the Antofagasta region: "In our region of Antofagasta we produce a significant amount of renewable energy that is lost, but it also fails to lower the 'electricity bill'. We must change this reality." For his part, deputy Migue Ángel Calisto indicated “We definitely have to look at the contracts, there is the definitive solution to the big problem of increases.”

For his part, Rubén Oyarzo stressed the need for the benefits of renewable energies to reach Chilean families: "We need the great impact that renewable energies have had in Chile to reach families through an effective reduction in the ' electricity bill'", to which her counterpart, Representative Joanna Pérez, added “ACERA's explanation was very clear in indicating the benefits of renewable contracts, but that being tied to old and expensive contracts, it does not allow us reduce the rate.”

This meeting represents a significant step in the joint effort to understand and improve the impact of renewable energies on the country's electricity rates, always seeking to benefit consumers and promote a more sustainable and competitive economy.