Chile roundup: 2025 price hikes, PELP report, decarbonization consultation

Price outlook

Average Chilean regulated residential client monthly electricity bills are due to rise again in January, while those for regulated industrial users are due to fall, energy consulting firm energiE says in a report.

Hikes for both segments, however, are due for 2H25.

In May this year, regulated user rates were unfrozen after being virtually unchanged for around four years. Rates were first frozen as a measure implemented in response to the 2019 social protests.

Next month, typical residential and industrial bills are scheduled to climb 10.6% to 37,011 pesos (US$37.65) and fall 2.9% to 2.44mn pesos, respectively, when compared with bills sent out to users in October.

The residential hike, the report states, responds to the application of a 22 peso/kWh charge – known as Cargo MPC – for the repayment of a multibillion-dollar debt pile accrued by generators while rates were frozen. The shrinking of industrial bills reflects a drop in the electricity component and the halting of additional charges, given these users have already paid these.

In July, under one scenario, the report adds, bills for residential and industrial users are forecast to climb by 4.3% and 4.6%, respectively, compared with January's. This scenario assumes that exchange rates hold steady at around 972 pesos to the US dollar and that inflation in the US continues to trend higher. These variables impact average node prices, which distribution concessionaires transfer to their regulated clients.

Node prices are determined in December and June of each year. 

Against this backdrop, the energy ministry has lowered the entrance bar to the nonregulated market to 300kW from 500kW. 

ALSO READ: Arguments for and against lowering the nonregulated market entrance barrier in Chile

Forecasts

Electricity could account for between 47% and 73% of the end-use energy matrix in Chile by 2050, up from 24% currently.

So reads a report published following the latest long-term energy planning process, or PELP as it is known.

Every five years, the energy ministry must carry out the process, the latest corresponding to 2023-27.

Production of green hydrogen is expected to constitute a key demand driver through 2060. In terms of production to supply local offtakers, the energy carrier could account for between 26% and 53% of total electricity demand by then.

Demand for green hydrogen, meanwhile, is projected to be highest in Antofagasta and Santiago Metropolitan regions. 

In terms of its participation in the energy matrix, hydrogen could account for between 8% and 19% by 2060. Chief demand drivers are road freight, accounting for 59%, and mining, where the emission-free product is envisaged as a diesel substitute for engines and could account for between 24% and 33%.   

According to the report, green hydrogen, as a diesel substitute for engines in the copper segment, is projected to have a 44.3% participation in open-pit mining in 2035 and a 10.4% participation in underground mining in 2040. In the non-copper mining segment, green hydrogen could account for 92.5% in 2050. 

The report is scheduled to be updated annually through 2027. A new planning process – corresponding to 2028-32 – will be underway by the end of next year. 

PELP is used for forecasting and as input for transmission infrastructure planning.

Chile’s national energy policy aims to achieve a zero-emission generation park by 2050. For 2030, the objective is to obtain 80% of power from renewables. 

The PELP final report can be downloaded from the box at the top of the page.

Decarbonization plan's public consultation 

Chile has extended a public consultation on its draft decarbonization plan to January 15. The original deadline was December 16.

The document outlines concrete measures, covering areas such as the conversion of plants to low-emission fuels, the enabling role of transmission, the supporting role of gas, and the electrification of demand.

ALSO READ: Chile’s coal-fired generation exit: The state of play

More information can be obtained here

Technical rules

Chile’s national energy commission CNE published its 2025 technical rules work plan after officially greenlighting the document.

Among multiple work areas is the development of electricity coordination and operation technical rules, which will be put on hold until the energy ministry completes the modification of decree No. 125, focused on energy storage systems and seen as key to completing, for now, the regulatory jigsaw puzzle.

Among other facets, work is also due to continue on the modification of technical rules for coordination and operation of the country's fleet of distributed generation plants of up to 9MW, known as PMGDs.

The plan can be downloaded from the Documents box at the top right of the page.