October 20, 2013

Chilean President Piñera Signs 20/25 Law

On October 14th, 2013, Chilean President Sebastian Piñera signed into law a bill which mandates that utilities source 20% of their electricity from “non-conventional” renewable energy (ERNC), including solar photovoltaic (PV) and concentrating solar power (CSP), by 2025.

The law will create annual bidding processes for utilities to purchase electricity from ERNC sources. The president additionally signed a law making changes to the permitting process, which promises to reduce estimated permitting time from 700 to 150 days.

“There are immense riches in the energies of the future,” stated President Piñera. “I am sure that many nations would like to have the solar radiation of our deserts, which permit a really impressive potential for solar photovoltaics or concentrating solar power.”

“Already this potential is transforming into reality, through multiple projects which have been authorized y promoted through our administration. This ability to use sicence and modern technology to confront the problems and challenges of Chilean society is something which our administration and also the private sector is profoundly committed.”

The bill's definition of ERNC specifically excludes large hydroelectric projects, such as the controversial HidroAysén project.

The Piñera administration's complicated relationship with the 20/25 law

The 20/25 law saw a long road. While President Piñera originally proposed a goal of 20% ERNC by 2020 in May 2010, which Jaime Orpis (UDI) introduced as a law in September of that year, his administration has been a main stumbling block to its passage.

Energy Minister Bunster, while fond of posing in front of completed wind farms and solar plants, repreatedly opposed the bill, causing it to stall in the nation's parliament. This ended in a compromise where the target was reduced to 20% by 2025, as well as a price cap of USD 0.095-0.010/kWh in the bidding system.

ERNC as a political theme in Chile

ERNC is a political issue in Chile, and its support crosses the political spectrum. Senators that supported the 20/20 law represented a fairly even distribution of parties from the far left to the far right, including centrist parties.

Part of the impetus to pass the bill may have come from November elections, where a center-left coalition led by Former President Michele Bachelet threatens to replace the center-right coalition of Piñera. As reported by Solar Server, Bachelet has used renewable energy and particularly solar as a theme in her campaign, even if little ERNC was installed during her presidency.

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