The Government of Chile will invest over one million euro (780 million pesos) to accelerate renewable energy projects accounting for 740 MW. This investment will benefit fifty renewable initiatives: 15 mini-hydro plants, 12 solar parks, 15 wind farms, 7 biomass plants, a hybrid plant and a proposed associative transmission line.
The tender which has just been approved by the Chilean government is geared to electricity projects based on renewable energies with a capacity under 50 MW that feed energy into electrical systems and projects that develop associative transmission lines, ie, to facilitate the connection of more than one project.
This financial instrument is intended to co-finance up to 40% of pre-investment studies, with a cap of 1,000 UF (Promotion Units) for studies in their inception stages, 2,000 UF for advanced stages and 2,000 UF for transmission lines. Today, one UF equals to some 18,700 euro.
Target: Own resources
“This contest is part of the Energy Agenda, where, as a government, we have established the use of our own energy resources as a priority. We want to add new supply from renewable sources to our energy mix and we want it to hopefully happen by incorporating new players. Here there is room enough for players of different sizes and technologies “, said the Minister of Energy, Maximo Pacheco.
The resources of the tender come from the Renewable Energy Centre (REC) of the Ministry of Energy-CORFO, who will also co-finance pre-investment studies in early and advanced stages and studies for associative transmission lines.
Part of these funds will be reimbursed by the German Development Bank (KfW), through an agreement for international cooperation in supporting the development of cleaner energy generation and displacement of emissions.
Eduardo Bitran, Vice President of the Development Corporation (CORFO), explained that in order to promote renewable energy, a loan from the German bank was granted that has two components: a subsidy to promote this type of energy and a credit component, which aims to fund unconventional renewable energy projects from the private sector as well as energy efficiency projects.
Martina Stamm, from KfW and responsible for the German financial cooperation in the Chilean energy sector, said that “Chile has a huge potential in renewable energy resources such as wind, solar, biomass / biogas, small hydro and geothermal. The CER Pre-Investment Studies instrument is very important for the thorough preparation of bankable NCRE projects. ”
With the institutional support that was formerly used, 121 initiatives were funded to develop renewable energies accounting to over 3,400 MW, “with the intent to building a portfolio of projects that can start maturing and entering into the energy matrix”, noted the director of CER.
And as an innovation, she stressed that it is the first tender in Chile that runs under standard rules on the prevention of Money Laundering and Terrorist Financing (LATF), as required by the standard of the OECD countries. Contestants must declare to know and apply the existing rules on LATF prevention, issued by the Financial Analysis Unit (UAF) of the Ministry of Finance.