Weekly Report - 7 March 2013 (WR-13-09)

CHILE| Punta Alcalde project suspended. On 5 March a Chilean court halted the construction of the Punta Alcalde thermal energy plant, three months after Endesa Chile, the local subsidiary of Spanish energy firm Endesa, had been given the green light to begin construction by the Sebastián Piñera government. The court’s order comes after a local fishing community in the Huasco Valley in Northern Chile, where the plant is to be located, filed a formal complaint claiming that the plant will heavily contaminate the area, affecting their activities. A similar objection was made by local environmental groups back in December but these were dismissed by a council of government ministers in charge of the initial evaluation of the project. Endesa maintains that the US$1.4bn Punta Alcalde project will be one of Chile and Latin America’s most efficient and environmentally friendly electricity producing plants, with a capacity to produce 740 megawatts (MW) of energy, making the project very important for Chile given that in recent years it has suffered from energy shortages. Furthermore, the company believes that plant’s modern design meets “the highest environmental standards as stipulated by the local laws applicable to this kind of project” and that the environmental concerns against it are largely unfounded. Yet in a unanimous decision a Santiago appeals court ordered Endesa to halt all operations on the site until the court reaches a final decision regarding the fishermen’s complaint. In a statement Endesa said that the court’s order will have little effect on the project at this time as “it it is still in the administrative stage and has yet to enter the execution stage”. The statement adds however, that the firm will continue to defend the project in the courts, to which it has already announced that it will present legal and technical arguments in support of the project and against the latest complaint.