Chile Energy Minister: Castilla, HidroAysen Projects Are Needed
October 21 2010 - 05:27PM
Dow Jones News
Chile's Energy Minister Ricardo Raineri on Thursday reiterated
the importance of developing large-scale power products such as the
HidroAysen hydroelectric project and Castilla coal-fired
project.
While Chile is looking to incorporate more alternative
renewable-energy sources into its energy matrix and to acquire the
technical capabilities to eventually make a production decision on
nuclear energy, experts argue that large-scale coal-fired and
hydroelectric energy projects also need to be developed so the
Andean nation can keep up with burgeoning demand.
As the country's gross domestic product grows at a pace of about
4%-5% a year, some 10,000 megawatts of new installed
capacity--roughly a doubling of capacity--will need to be added by
2020.
"It's important to recognize as a nation that our energy matrix
needs to be diversified and give space to hydroelectricity, such as
HidroAysen, and coal-fired projects such as Castilla," Raineri
said.
The $4.4 billion Castilla thermal project--developed by a unit
of Brazilian billionaire Eike Batista's EBX--would add 2,354
megawatts, and the $3.2 billion HidroAysen project--being developed
in a joint-venture by Chilean power generators Empresa Nacional de
Electricidad SA (EOC, ENDESA.SN) and Colbun SA (COLBUN.SN)--would
add another 2,750 megawatts in installed capacity to the nation's
central SIC power grid. This SIC grid runs from northern Tal Tal to
the southern Island of Chiloe and supplies energy to more than 90%
of the country's population.
"For us it's important to have these large power projects which
will produce lots of megawatts, although they have to be
environmentally friendly and they must respect the well-being of
our citizens," Raineri said while attending the inauguration of a
2.5-megawatt wind farm in the southern Magallanes region.
Chilean President Sebastian Pinera's nod to environmentalists in
August regarding GDF Suez's (GSZ.FR) Barrancones thermal power
project--a move which essentially killed the $1.1 billion project--
threw a monkey wrench in the nation's energy sector.
The country's two largest energy projects, Castilla in northern
Chile and HidroAysen in the far south, have been criticized because
of alleged environmental damages they would produce and have seen
their respective environmental permitting processes delayed
considerably.
Castilla is being held up due to a legal dispute regarding its
environmental study, while HidroAysen faces staunch opposition
because of plans to lay a transmission line that would span nearly
2,000 kilometers through pristine land and plans to dam the Baker
and Pascua rivers.
-By Anthony Esposito, Dow Jones Newswires; 56-2-715-8929;
anthony.esposito@dowjones.com