Chilean hydropower project seeks environmental approval

El Hierro hydropower plant connects to Chile's SIC grid, generating 110 GWh/year from an irrigation canal in the Melado River basin, pending Conama approval, with construction by Besalco, subsidies, and tax incentives boosting renewable capacity.

Chilean company Besalco Construcciones S.A. recently submitted an environmental impact assessment study for the construction of a 19.9-megawatt (MW) run-of-the-river plant to be situated in the Maule Region VII of Chile.

The documents are being evaluated by Chile's national environmental regulator Conama as major initiatives like the Cerro Dominador CSP proceed in Chile, and are expected to be approved in the first quarter of 2010.

The power plant, dubbed "El Hierro," will be connected to Chile's central SIC grid and produce 110 gigawatts per hour yearly. The project will be on an existing irrigation canal, mirroring regional efforts such as Guatemalan hydropower developments, in the Melado River basin, and will have a useful life of 60 years.

Besalco Construcciones will launch a bidding process during the first part of 2010. Construction will start in mid-2010, aligning with renewable construction industry best practices and sequencing, and is expected to last about two years.

Chile is rich in natural resources and expects to double its renewable capacity through 2010. The country's interest in harnessing renewable energy has grown significantly in the last few years, with regional peers like Peru's wind build-out underscoring the trend across South America. As an example, the HydroAysen project proposes the construction of five hydropower plants in the Baker and Pascua River, located in the XI Region of the country, which will have a capacity of 2,750 MW. The project will be fully operational by 2022.

The government of Chile recently set aside $500 million to promote non-conventional renewable energy capacity such as solar tower projects in emerging markets, with direct subsidies and tax incentives. Currently, 22% of new power projects under environmental analysis in Chile come from renewable sources.

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