EXECUTIVE SUMMARY

March 2010
this month ’ s series :

Electric
The quake necessitated an immediate shut down of the Chile’s energy sector and the
entire SIC (Sistema Interconectado Central) grid, which
runs from Chiloe Island in the south up to Taltal north of
Copiapo and supplies power to 93% of Chileans. When
attempting to reinitiate the grid, multiple problems were
2010 earthquake
discovered, most in sub transmission and distribution,
2010 was looking like a good year for Chile. immediately collapsed in the country, first
rather than generation or transmission. In a rush to
reconnect service as soon as possible, distribution The first month of the year saw 4.3% growth due to an oversaturation in calls, then later
and transmission companies had to repair substations, and 4Q09 2.1%, signs that the economic due to a lack of fuel to run the generators
transformers, posts, cables, etc, in a fashion that normally
crisis was passing and the soon to be to power their antennas after the backup
would not meet the country’s stringent safety standards,
which are on par with developed countries. This coupled President Sebastian Piñera was promising batteries were exhausted. While damage
with the fact that many electric installations were partially 6% annual growth. Unfortunately for the to the airport left stranded shipments of
damaged by the earthquake itself left the SIC in a fragile
country of 17 million people, the massive salmon to rot, salmon industry executives
state of operation.
8.8 earthquake that struck on the morning later advised of the difficulties of harvests
Although the recovery of the SIC was thought to be of February 27th will ensure that 2010, and because of a lack of fuel. Southern farmers
impressive, electric company executives and industry
even his entire presidency will be anything declared an emergency situation for this
experts have been hinting at ways to add increased
stability to it, some practical, some not so much. These but simple. The effects of the quake are still same reason throughout the south of the
have included adding another transmission line along the being calculated, but the latest estimates country. Travel to and fro the disaster zone
SIC, increasing the safety standards for transformers, a
amount to a 496 death toll and US$30 billion (mainly the VI, VII, and VIII provinces) was
widening of distribution line poles to decrease the chance
that lines would touch during earthquakes, burying electric worth of damage to infrastructure (US$20.9 made frantic by damaged infrastructure and
lines, an interconnection with Argentina or with Perú, billion), industry & commerce (US$5.3 a lack of functioning gas stations, whose
an interconnection between the two major electric grids
billion), and housing (US$3.7 billion). Some electric pumps were immobilized. And the
(the SIC and the SING in the north), a larger inventory of
electric generators, a move towards distributed generation of this damage was absorbed by the energy list goes on forever.
(DG), the use of more renewable power, and the sector, with an immediate impact on electric
deepening of energy efficiency measures (EE) to mitigate
distribution and major damage to the By mid March, Chile was largely past the
the stress on the SIC grid.
country’s largest oil refinery. With this in immediate results of the quake, with
Fuels mind, the importance of energy as a pillar of electricity reaching all but the most
The other major part of energy infrastructure affected by a nation was emphasized to an extreme and devastated areas where houses were
the earthquake was the fuels sector. As in the electric
should be cause for reflection to prepare for completely destroyed, and fuel supply was
sector, the violent shaking instantly shut down two of the
three refineries in the country. The Aconcagua refinery similar future events. guaranteed by arriving tanker ships. Now the
(100,000 b/d), located north of Valparaiso, was partially country is left to deal with the myriad long
back online by March 16th and one week later was
In the worse affected areas, a lack of term effects of the earthquake on the energy
producing at full capacity. On the other hand, the Bio-Bio
refinery located near the epicenter (116,000 b/d) will not electricity complicated an already desperate sector, and this report attempts to analysis
be operative for some months. Damage was significant situation, which took around 2 weeks to some of those impacts, as well as the sector’s
for this refinery, a tower fell, and the cogeneration plant
approach normalcy. Cellular phone service recovery in the months after the quake.
was badly affected, as were the water decantation
tanks. Taken together, the two refineries meet 72% of the
Chilean fuels market, with another 8% coming from the
smaller Gregorio refinery in the Magallanes province, the Electric generation by province
remainder being imports.
(Gwh)
1,200
Most affected area

1,000

800

600

400

200

0
I II III IV V VI VII VIII IX X XI XII R.M. XIV XV
Provinces

Source: INE (Chilean Statistics department)

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 Energy Daily Written and researched by
Michael LaGiglia

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