Development & Aid, Environment, Headlines, Latin America & the Caribbean

CHILE: Crisis Prompts Long Overdue Energy Savings Plan

María Cecilia Espinosa

SANTIAGO, Jul 26 2005 (IPS) - Pushed by an energy crisis caused by cuts in natural gas supplies from Argentina and by soaring international oil prices, Chile has finally adopted a multisectorial plan for the efficient use of electricity and fuel.

“Chile is at least 20 years behind other countries in the region that have undertaken energy efficiency programmes in Latin America,” Sara Larraín, the head of the Sustainable Chile Programme, an activist group, told IPS.

The environmentalist added that the new strategy was not only a challenge for technological development but would benefit the environment as well.

The energy efficiency and savings plan was launched early this year by the government in association with business and civil society, and sets short-term and medium-term goals.

Chile, which has limited energy resources, mainly based on hydropower, has become increasingly reliant on fuel imports over the past few decades.

Last year, neighbouring Argentina began to cut its exports of natural gas to Chile, causing an energy crisis here and forcing the government to reconsider its energy policy.

Iván Couso, the coordinator of the plan, told IPS that energy efficiency is a highly complex issue that requires public awareness and participation, as well as public policies.

He also described it as “a very important challenge, linked to greater competitiveness for the country, improved technology, cultural changes,” and more sustainable development.

The head of the Institute of Political Ecology, Manuel Baquedano, remarked to IPS that in order to bring about lasting energy savings, the contracts signed with privatised power companies “should dedicate a proportion of utility fees to energy efficiency, starting with one or two percent.”

What is needed, he said, is a culture of energy efficiency. Chile is an energy-wasting society, he added, where increase in gross domestic product (GDP) is associated with a rise in electricity generation, a concept that no longer operates in Europe.

Baquedano added that “today, economic growth does not necessarily mean an increase in energy use.”

Public policy proposals as well as successful energy savings experiences in Brazil and Mexico were discussed during a Jul. 19-20 seminar at the Santiago regional headquarters of the U.N. Economic Commission for Latin America and the Caribbean (ECLAC).

The seminar, which was organised by ECLAC, the Sustainable Chile Programme and the Economy Ministry, and sponsored by the Heinrich Boell Foundation of Germany, also discussed the regulation of the mining, forestry, manufacturing, power, and construction industries, as well as the promotion and financing of energy savings measures.

The steady rise in demand for energy, which is almost double the growth of GDP, is not sustainable and leads to excessive pollution, a heavy economic burden for low-income families, and a setback in the competitiveness of the mining and manufacturing sectors, participants warned.

Energy consumption in Chile is growing at an annual rate of seven percent, and spending on oil imports climbed to 2.5 billion dollars in 2004, while experts estimate that the country could save 100 million dollars a year if consumption of electricity and fuel was cut by just 1.5 percent a year.

In the seminar, ECLAC Deputy Executive Secretary Alicia Bárcena said “energy efficiency should be seen as a citizen’s right.”

Chilean Minister of the Economy and Energy Jorge Rodríguez Grossi said the challenge is “how to achieve the energy savings we want with less financial resources.”

Fernando Sánchez, ECLAC director of the natural resources division, said the generation of energy must be combined with measures aimed at protecting the environment.

The successful experience of Brazil was highlighted at the seminar by Marcelo Poppe, a former Brazilian minister of energy development.

In order to reduce electricity consumption in Brazil during an energy crisis that broke out there in mid-2001, the government ordered rationing measures to avoid waste and excess demand, offered incentives for the development of alternative sources of energy and for efficient energy use, and designed awareness-raising and educational programmes.

“Economic growth did not drop. What happened was a change of habits was brought about,” said Poppe. “Brazilians have not returned to the pre-crisis levels of consumption, because they got used to using less energy.”

ECLAC consultant Odon de Buen also noted that since Mexico began to implement energy savings programmes, household consumption has not increased, electricity use was reduced by 15 percent in public buildings, and savings have amounted to 180 million dollars a year.

According to Baquedano, one of the factors of success in the energy savings programmes in Brazil and Mexico was the presence of strong state-run energy companies.

In Chile, he added, “we are finally seeing the political will to promote energy efficiency and we hope the energy companies, most of which are private, will respond.”

Environmental education among the upcoming generations is also essential, said Baquedano.

“The concepts of energy savings, efficiency and conservation, and the use of renewable energy sources, must be introduced starting in schools,” the environmentalist added.

Among the conclusions reached by the seminar, Larraín underlined to IPS the recognition of the urgent need for Chile to catch up in terms of energy efficiency.

She noted that energy efficiency not only implies a more responsible use of energy resources in a country dependent on oil and natural gas imports, but could also boost the competitiveness of the economy and curb pollution.

Larraín praised the change in direction in public policies reflected by Chile’s “enormously promising” new energy efficiency programme, which she described as “a public-private multisectorial initiative made up of a consultative committee that includes representatives from all of the ministries, several business chambers and civil society.”

She recommended “a national campaign with a large educational, communicational and informational component targeting all sectors, regions and consumers.”