Chile's National Electric Coordinator (CEN) announced that further marginal cost coupling is expected in the country's Short-Term Market during peak solar irradiance hours over the next two years. Specifically, the CEN determined, through simulation, that there will be a drop in energy prices during solar hours, as they "will tend to be at US$0/MWh persistently across much of the system," although some winter 2024 scenarios may not reflect this situation. For 2025, based on the assumptions used in the study, the regulatory authority indicates that this coupling will extend across the entire system for much of the time. "Under the evaluated hydrological conditions, during 2024 and 2025, the National Electric System is expected to be economically coupled at US$0/MWh for 8 out of the 12 months of each year" during solar hours between the northern and southern regions, the CEN stated. "In turn, marginal costs during early morning and peak hours can vary between 60 and 130 USD/MWh in the central zone.
However, for scenarios of high wind power production in the southern region, with transmission system restrictions in place, marginal costs during the early morning and evening hours can range from 0 to 100 USD/MWh from the southern region to the south-central region,” they explained. In addition to hydrological scenarios, the analysis was based on a series of assumptions, including maximum liquefied natural gas availability, increased demand, fuel price fluctuations, the planning of generation and transmission infrastructure, and the maintenance of other power plants.
Fraunhofer Chile noted that renewable energy injections tripled during 2022What is the cause of this situation? The National Electric Coordinator (CEN) primarily attributed it to the oversupply of solar energy in the National Electric System (SEN), which generates surpluses at some nodes. It's worth noting that the current renewable operating capacity is 14,853 MW in the utility-scale segment, in addition to another 113 MW of storage and non-conventional renewable energy (NCRE) and 3 MW of non-conventional renewables and hydrogen. Furthermore, over 6,500 MW are under construction in the short and medium term (5,982 MW of NCRE and 416 MW of storage), meaning solar energy could exceed 13,000 MW of installed capacity. "This suggests that the zero marginal cost during daylight hours will be a persistent characteristic in the coming years," a CEN document emphasizes.
In other words, a problem will persist that
It dates back several years in the country.