MercoPress. South Atlantic News Agency

Energy short Chile heatedly ponders the nuclear option

Chilean President Michelle Bachelet will stand firm on her pledge against the use of nuclear energy, government spokesperson Ricardo Lagos Weber said this week.

Leaders within her own ruling Concertación coalition, however, are now forming a united front to promote further research into the alternative energy source, citing an estimated seven percent yearly increase in energy demand and diminishing prospects for gas imports from Argentina and Bolivia.

On August 21, the presidents of the four Concertación parties, during a routine meeting to set the political agenda, demanded explanations for Bachelet's steadfast opposition to nuclear energy. Though a taboo subject for decades in Chile, nuclear energy is gaining followers within Latin America, most notably Argentina, Mexico, and Brazil, as well as around the world, where 440 nuclear power plants provide for 16% of the world's energy needs.

"It is necessary to begin studying nuclear energy to decide whether it should or should not be used," said Radical Party President José Antonio Gómez. "Doing a study does not mean we're going to build a power plant, but it's important to have this information."

Bachelet last month announced plans to make Chile energy independent within two years but has steadfastly rejected nuclear energy.

"The responsible thing to do is to study, I reiterate, study, all of the different alternatives that are within reach, from hydroelectric to thermoelectric", said Lagos Weber.

But Bachelet has given mixed signals ever since her presidential campaign in November 2005, when she signed a pact with 20 leading environmentalists to refrain from nuclear energy. Mining and Energy Minister Karen Poniachik, along with Lagos Weber, confirmed Bachelet's position over the last few weeks.

However on August 12, the Chilean president signed a bilateral agreement with Brazil to cooperate "in the peaceful use of nuclear energy," the implications of which are still unclear.

Nuclear energy resurfaced on the Chilean political agenda in 2004 - during the height of an energy crisis with Argentina - when then President Ricardo Lagos ordered a study into alternative energy sources. One year later, in his last Congressional address, Lagos said Chile cannot ignore nuclear energy as it plans for the future.

The outlook about gas-exporting countries Argentina and Bolivia is no better today.

Starting next year Argentina will begin to cut its exports, thanks in part to a booming economy and a 10% annual growth in energy demand. These gas shortages may affect Chilean homes as soon as next year, said high-profile economist Alcadio Oña, and some experts predict that Argentina will cut off all exports by 2009 or 2010.

Bolivia, though rich in natural gas reserves, offers no relief. Its annual production of 35 million cubic meters of gas are either consumed internally or sent to Brazil and Argentina. Neither private companies nor the government seem willing to expand production, an additional million cubic meters per day would cost 100 million US dollars.

Northern Chile alone requires four million cubic meters daily. And with Bolivia's demand for a land passage to the Pacific still unmet, prospects look even dimmer.

Liquid gas and hydroelectric power are two of the most viable alternatives. ENAP, the state-owned fuel company, is erecting a liquid gas plant in Quinteros, and four hydroelectric dams to be built by the private sector along the Pascua and Baker Rivers in southern Chile will generate an estimated 2,355 MW for Chile's central power grid, supplying 25% of the nation's current energy needs.

But a recent study by Endesa, one of two energy companies spearheading the 4 billion US dollars hydroelectric project, reported that Chile's energy demand will grow by 10,000 MW ? four times the capacity of the dams - over the next 10 years. Given that it takes an average of 10 years to build a nuclear power plant, the Concertación leaders reason that Chile must look into new energy sources as quickly as possible.

One argument in favour of nuclear power is that plants are expensive to build but relatively cheap to maintain. Consultant Hugh Rudnick estimated a start-up cost of 1.6 million US dollars per MW for nuclear plants, compared to the 500,000 to 700,000 US dollars needed to construct a gas-powered plant. Once up and running, however, one megawatt hour would cost between 5 and 10 US dollars, less than half the 12 to 30 US dollars price tag for liquid or natural gas. The nuclear option becomes more attractive as the country's overall energy needs increase. It poses too great of a risk to concentrate more than 15% of the country's energy production in any one power plant. A 1000 MW nuclear power plant ? any smaller would not be feasible ? would surpass the current 15% threshold of 800 to 900 MW. In the next 10 to 12 years, however, energy output will grow to around 18,000 MW, thereby reducing the risk of nuclear energy dependence.

Proponents point to Taltal, 300 kilometers south of Antofagasta, as prime real estate for a possible nuclear power plant. Taltal is located at the meeting point of Chile's two primary energy distributors--one to the north (the Interconnected System of Norte Grande, or SING) and one to the south (the Central Interconnected System, or SIC)--which could both be served by one nuclear power plant.

For now, though, the Bachelet administration is focused on developing other forms of alternative energy, primarily hydroelectric and liquid gas, as well as wind energy. The National Environmental Commission (CONAMA) listed seven wind energy projects that are approved or under review. One is a 372 million US dollars investment by the Spanish company Acciona Energía Chile S.A. Endesa Eco hopes to invest another 17 million US dollars into wind power in Region IV.

Responding to concerns that these alternative energy sources will not be sufficient to attain independence without nuclear energy, Lagos Weber said that the energy crisis is not as severe as some critics have stated.

"No gas stoppages have been announced," he said. "There are indications from ?anonymous sources' that Argentina will not be able to meet its contracts with us. This is true for the moment, but Argentina has reiterated its promise to provide gas for both residential and commercial use in Chile, in the quantity that we need."

Chilean gas executives, who met last week with Argentine authorities in Buenos Aires, are drawing up contingency plans in case Lagos Weber's predictions don't come true, just as the rest of Chile's energy sector is bracing itself for an uncertain future.

By Renata Stepanov The Santiago Times - News about Chile