The challenges of transmission expansion in the Chilean power sector: market or central planning?

The need to determine adequate regulations in the transmission activity in deregulated environments does not have a common solution worldwide, with most countries compromising on alternatives that are adapted to local market conditions. Relevant issues are transmission tariff schemes and transmission expansion methods, both intimately linked. The Chilean 1982 regulation defines a user based tariff scheme with a nonregulated market approach to expansion that has proved unsatisfactory and conflictive. The main transmission company has questioned the sustainability of the activity. A change of law is going through congress aiming at solving the problem. Opposing views of market expansion versus centralized planning approaches are being confronted. The presentation will describe the process and alternative paths that may be followed.