Chile’s worst drought this century has left dams supplying hydro generating systems with little water, causing daily blackouts of up to two hours. Now a special commission set up by Chile’s Congress will decide whether the government should have powers to impose fines on utilities.
The panel was created because the country’s upper and lower parliamentary houses have been at loggerheads over a bill that proposes to give the government more legal power to regulate the electricity industry. The power bill was proposed after utility companies resorted to load shedding during the last two months: proponents of the bill argue that the utility companies have not taken sufficient precautions to provide a backup systems to tide over drought periods. President Eduardo Frei, who is in the last year of a six-year term, supports stronger regulation over the utilities. The most controversial proposals include giving the government the right to fine power companies up to US$6M for failing to supply electricity to consumers. Others are compensation for customers who lose power and the creation of an agency to oversee the sector.