Chile passes Energy Efficiency Law, aiming at a 10% reduction in consumption by 2030

On January 7, 2021, Chile passed a new law relating to energy efficiency across the country. “Today, for the first time in the history of Chile, we have an Energy Efficiency Law, which calls us to make a rational and efficient use of our resources and which covers practically all energy consumption in the country: transportation; industry and mining; and residential, public and commercial sector. This is, without a doubt, very good news since it allows us to advance on the path of sustainability, improving the quality of life of people, contributing to a cleaner environment and increasing the productivity of our companies,” stated the Minister of Energy and Mining, Juan Carlos Jobet.

The Minister of Energy also highlighted that “the energy efficiency law is part of the rapid change in our sector. Ten years ago, nobody would have imagined that 44% of electricity generation would be based on renewable energy,” while highlighting the multiple benefits that the new legal body brings: it covers the three sectors that represent practically all consumption of energy in the country: transportation (37%); industry and mining (40%) and residential, public and commercial sectors (23%).

Regarding the benefits in the medium term, Minister Jobet indicated that “if the measures contemplated in the law are properly applied by 2030, we will have a reduction in energy intensity of 10%, an accumulated saving of US$15,200 million and a reduction of 28.6 million tonnes of CO2. This is equivalent to avoiding the annual journeys of 15.8 million light vehicles or the annual absorption of 1.8 million hectares of native forest.”

The Ministry of Energy will prepare a National Energy Efficiency Plan every five years and it is established that the first plan must contemplate a goal of reducing energy intensity by at least 10% by 2030 compared to 2019. It also includes a goal for consumers with energy management capacity, consisting of an average reduction of their energy intensity of at least 4% during the period of the plan.

Large energy consumers like miners, who represent more than a third of the energy consumed in the country, must actively manage it. For this, the Ministry will determine the consumers with energy management capacity, who must implement an energy management system (SGE). Additionally, they must report annually on energy consumption and other indicators, with which the Ministry will annually prepare a public report. The SEC will be in charge of supervision and sanction – this is the Superintendencia de Electricidady Combustibles, Chile’s national agency for the regulation of electrical products.