Energy Policies Beyond IEA Countries: Chile 2018

191 Pages·2018·4.92 MB·English

by  coll.

ENERGY
POLICIES
BEYOND IEA

COUNTRIES
Chile
2018
Secure
Sustainable
Together
INTERNATIONAL ENERGY AGENCY
The International Energy Agency (IEA), an autonomous agency, was established in November 1974.
Its primary mandate was – and is – two-fold: to promote energy security amongst its member
countries through collective response to physical disruptions in oil supply, and provide authoritative
research and analysis on ways to ensure reliable, affordable and clean energy for its 29 member
countries and beyond. The IEA carries out a comprehensive programme of energy co-operation among
its member countries, each of which is obliged to hold oil stocks equivalent to 90 days of its net imports.
The Agency’s aims include the following objectives:
n Secure member countries’ access to reliable and ample supplies of all forms of energy; in particular,
through maintaining effective emergency response capabilities in case of oil supply disruptions.
n Promote sustainable energy policies that spur economic growth and environmental protection
in a global context – particularly in terms of reducing greenhouse-gas emissions that contribute
to climate change.
n Improve transparency of international markets through collection and analysis of
energy data.
n Support global collaboration on energy technology to secure future energy supplies
and mitigate their environmental impact, including through improved energy
efficiency and development and deployment of low-carbon technologies.
n Find solutions to global energy challenges through engagement and
dialogue with non-member countries, industry, international
organisations and other stakeholders.
IEA member countries:
Australia
Austria
Belgium
Canada
Czech Republic
Denmark
Estonia
Finland
France
Germany
Secure
Greece
Sustainable
Hungary Together
Ireland
Italy
Japan
Korea
Luxembourg
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
© OECD/IEA, 2018 Spain
International Energy Agency Sweden
Website: www.iea.org Switzerland
Turkey
United Kingdom
United States
Please note that this publication
is subject to specific restrictions
The European Commission
that limit its use and distribution.
The terms and conditions are also participates in
available online at www.iea.org/t&c/ the work of the IEA.
ENERGY
POLICIES
BEYOND IEA

COUNTRIES
Chile
2018
D
Foreword R
O
W
The International Energy Agency (IEA) has been conducting in-depth country reviews E
since 1976. It is a core activity and the process of review by peers not only supports R
member countries’ energy policy development and mutual learning, but it also O
encourages the exchange of international best practice and experience. In short, by F
seeing what has worked – or not – in the “real world,” these reviews help to identify
policies that achieve objectives and bring results.
In 2016, the IEA decided to modernise the reviews by shifting their focus to key energy
security challenges in fast-changing global energy markets, and to the transition to a
clean energy system.
Occasionally, and upon request, the IEA also conducts these peer reviews for Partner
countries. This second in-depth review of Chile’s energy policies takes stock of the
progress in Chile’s energy policy since the 2009 IEA review. Chile’s energy policy has
evolved dynamically in recent years. In response to changes in the domestic and
international environment, significant institutional and policy reforms as well as major
infrastructure projects have been carried out. The National Energy Policy 2050 was
adopted in 2015, and the electricity sector, in particular, has developed quickly. Chile has
also emerged as a world-class destination for investment in solar and wind energy.
As the new administration prepares to take over the helm of energy policy in March
2018, it is my hope that this review and its policy recommendations will prove useful as a
reference point for policymakers and stakeholders alike. The IEA will be delighted to
continue this policy dialogue which started with the first in-depth review in 2009 and to
continue supporting Chile in its quest for a secure, affordable and environmentally
sustainable transformation of its energy sector and economy.

Dr. Fatih Birol
Executive Director
International Energy Agency
3

S
T
ENERGY INSIGHTS N
E
T
Executive summary .........................................................................................................11
N
Launching new institutions and a new long-term energy policy........................................11 O
C
Building a low-carbon national electricity system ..............................................................12

F
Limiting energy-related CO emissions .............................................................................13 O
2

Realising the energy efficiency potential ...........................................................................14 E
L
Ensuring efficient and clean use of firewood ....................................................................15 B
A
Improving oil security .........................................................................................................16 T
Key recommendations .......................................................................................................16
1. General energy policy .................................................................................................17
Country overview ...............................................................................................................17
Economic overview ............................................................................................................19
Energy supply and demand ...............................................................................................19
Institutions ..........................................................................................................................24
Energy policy objectives ....................................................................................................30
Key legislation....................................................................................................................35
Assessment .......................................................................................................................38
Recommendations .............................................................................................................43
References ........................................................................................................................43
ENERGY SECURITY
2. Oil ..................................................................................................................................45
Overview ............................................................................................................................45
Supply and demand ...........................................................................................................46
Infrastructure......................................................................................................................49
Industry structure/retail sector ...........................................................................................52
Prices and taxes ................................................................................................................53
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TABLE OF CONTENTS

Emergency response policy ..............................................................................................54
Assessment .......................................................................................................................56
Recommendations .............................................................................................................57
References ........................................................................................................................57
3. Natural gas ...................................................................................................................59
Overview ............................................................................................................................59
Supply and demand ...........................................................................................................60
Institutions ..........................................................................................................................62
Regulatory framework .......................................................................................................63
Industry and market structure ............................................................................................64
Infrastructure......................................................................................................................66
Prices .................................................................................................................................71
Security of supply ..............................................................................................................73
Assessment .......................................................................................................................73
Recommendations .............................................................................................................75
References ........................................................................................................................76
4. Coal ...............................................................................................................................77
Overview ............................................................................................................................77
Supply ................................................................................................................................78
Demand .............................................................................................................................79
Coal-fired power generation ..............................................................................................80
Assessment .......................................................................................................................82
Recommendations .............................................................................................................83
References ........................................................................................................................83
5. Electricity......................................................................................................................85
Overview ............................................................................................................................85
Supply and demand ...........................................................................................................85
Institutions ..........................................................................................................................89
Regulatory framework .......................................................................................................90
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TABLE OF CONTENTS

Industry and infrastructure .................................................................................................96 S
T
Wholesale market design ............................................................................................... 100 N
E
System integration of VRE ............................................................................................. 101
T
N
Prices .............................................................................................................................. 104
O
Security of supply ........................................................................................................... 105 C

Assessment .................................................................................................................... 106 F
O
Recommendations .......................................................................................................... 109
E
L
References ..................................................................................................................... 110
B
A
T
ENERGY SYSTEM TRANSFORMATION
6. Energy and climate change ..................................................................................... 111
Overview ......................................................................................................................... 111
Energy-related CO emissions ....................................................................................... 112
Institutions .............₂.......................................................................................................... 115
Climate targets and policy .............................................................................................. 116
Assessment .................................................................................................................... 120
Recommendations .......................................................................................................... 122
References ..................................................................................................................... 122
7. Energy efficiency ...................................................................................................... 123
Overview ......................................................................................................................... 123
Final energy consumption by sector .............................................................................. 124
Energy intensity .............................................................................................................. 126
Institutions ....................................................................................................................... 127
Policy .............................................................................................................................. 128
Assessment .................................................................................................................... 136
Recommendations .......................................................................................................... 138
References ..................................................................................................................... 139
8. Renewable energy .................................................................................................... 141
Overview ......................................................................................................................... 141
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TABLE OF CONTENTS

Supply and demand ........................................................................................................ 142
Institutions ....................................................................................................................... 146
Policy objectives ............................................................................................................. 146
Policies and measures in the electricity sector .............................................................. 147
Policies and measures in heating and transport ............................................................ 151
Cross-cutting measures.................................................................................................. 156
Assessment .................................................................................................................... 156
Recommendations .......................................................................................................... 158
References ..................................................................................................................... 159
9. Energy technology research, development and innovation ............................... 161
Overview ......................................................................................................................... 161
Institutions ....................................................................................................................... 161
Policies and strategies.................................................................................................... 164
Public funding for energy RDI ........................................................................................ 166
Energy RDI programmes ................................................................................................ 167
International collaboration .............................................................................................. 170
Monitoring and evaluation .............................................................................................. 173
Assessment .................................................................................................................... 173
Recommendations .......................................................................................................... 174
References ..................................................................................................................... 175
ANNEXES
ANNEX A: Organisations visited .................................................................................... 177
ANNEX B: Energy balances and key statistical data ..................................................... 180
ANNEX C: International Energy Agency “Shared Goals” .............................................. 184
ANNEX D: Glossary and list of abbreviations ................................................................ 186

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TABLE OF CONTENTS

S
LIST OF FIGURES, TABLES AND BOXES
T
N
Figures
E
1.1 Map of Chile ..........................................................................................................17 T
1.2 Overview of energy production, TPES and TFC, 2015 ........................................20 N
1.3 TPES by source, 1973-2016 .................................................................................21 O
1.4 Breakdown of TPES in Chile and IEA member countries, 2016 ..........................21 C
1.5 Energy production by source, 1973-2016 .............................................................22
F
1.6 Import dependency by fuel, 1990-2016 ................................................................23
O
1.7 TFC by sector, 1973-2015 ....................................................................................23
1.8 Fuel share of TFC by sector, 2015 .......................................................................24 E
1.9 Structure of energy institutions in Chile ................................................................27 L
1.10 Goals in the Chilean National Energy Policy 2050 ...............................................31 B
2.1 Oil’s share in Chile’s energy sector, 1976-2016 ...................................................45 A
2.2 Crude oil supply, 1973-2016 .................................................................................46 T
2.3 Oil products supply, 1973-2016 ............................................................................46
2.4 Crude oil and oil products imports by country, 2016 ............................................47
2.5 Oil consumption by sector, 1973-2015 .................................................................48
2.6 Oil supply by product (volumes), 2016 ..................................................................48
2.7 Oil supply infrastructure, 2016 ..............................................................................51
2.8 Transport fuel prices in Chile and IEA countries, second quarter 2017 ...............54
3.1 Natural gas shares in different energy supplies in Chile, 1976-2016 ...................59
3.2 Gas supply by source, 1973-2016 ........................................................................60
3.3 Natural gas net imports by country, 1996-2016 ....................................................61
3.4 Natural gas consumption by sector, 1973-2015 ...................................................62
3.5 Natural gas infrastructure, 2017 ............................................................................70
3.6 Natural gas prices for households in Chile and IEA member countries, 2016 .....72
3.7 Natural gas prices for households in Chile and selected IEA
member countries, 2000-16 ..................................................................................72
4.1 Coal’s share in different energy supplies in Chile, 1976-2016 .............................77
4.2 Coal supply by source, 1973-2016 .......................................................................78
4.3 Coal imports by country, 1973-2016 .....................................................................79
4.4 Coal consumption by sector, 1982-2015 ..............................................................79
5.1 Electricity gross generation and final consumption, 1973-2016 ...........................86
5.2 Electricity generation by source, 1973-2016 .........................................................87
5.3 Breakdown of electricity generation by source in Chile and IEA
member countries, 2016 .......................................................................................87
5.4 Electricity generation by source and consumption by sector, 2016 .....................89
5.5 Electricity consumption by sector, 1973-2015 ......................................................89
5.6 Volume and price (USD/MWh) of electricity-supply tenders, 2006-17 .................94
5.7 Map of power systems and their installed capacity, November 2017 ..................98
5.8 Map of the interconnected high-voltage electricity grid, end 2017 .......................98
5.9 Electricity prices in Chile and IEA member countries, 2016 .............................. 104
5.10 Electricity prices in Chile, Korea, Mexico and the United States, 2000-16 ....... 105
6.1 GHG emissions by sector, 1990 and 2013 ........................................................ 111
6.2 Energy-related CO emissions by sector, 1973-2015 ....................................... 112
6.3 Energy-related CO emissions by fuel type, 1973-2015.................................... 113
6.4 CO emissions and₂ main drivers in Chile, 1990-2015 ....................................... 114
₂
₂
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