Change in Chile: The presidential elections and what they mean for our Patagonia BioGem

In Chile’s landmark presidential elections Sunday (January 17th), right-center candidate Sebastian Piñera, defeated the ruling left-center Concertación coalition’s nominee, Eduardo Frei, by a tight margin of 51.6% / 48.39%.  These results are especially remarkable for two reasons: 

1. The Concertación has been in power since the fall of Pinochet’s dictatorship in 1990, so this is the first time in 20 years that the coalition has lost the presidency.

2. Current President Bachelet, also of the Concertación, enjoys extraordinarily high approval ratings (some estimate 81%), yet her even popularity and backing could not secure a victory for Frei.

These facts both clearly signal that Chileans are eager for a change.  But what will this change mean for our BioGem in Patagonia, where we are working to save two of the region’s most pristine rivers from HidroAysén’s massive hydroelectric proposal?

Throughout the campaign, the President-elect had been presented above all as a businessman (check out the headline of the New York Times article about the election).   Indeed, his business assets range from investments in the country’s largest airline, to a popular television channel, to a major soccer (ahem, excuse me – football) team, among others.  On the campaign trail, Piñera often touted his business credentials as evidence of his executive experience and skills.

As HidroAysén’s environmental review process proceeds and the company continues to seek approval, it will be imperative for President-elect Piñera to acknowledge that HidroAysén is simply a bad business investment.  As evidence, one need look no further than its environmental impact assessment (EIA) documents, which underscore the proposal’s woefully poor planning and deficient research.  One could also look to the fact that a July 2009 study demonstrated that there is absolutely no need for any of the dams’ expected electrical output – and to date, no one has argued otherwise.  Furthermore, BBVA, a major international bank that was considered one of the likely potential financiers of HidroAysén, publically and strongly announced that it would not consider backing the project since it did not meet sustainability standards.  

President-elect Piñera has also already acknowledged the benefits of investing in energy alternatives.  He has stated his intention to foster the development in non-conventional renewable energy in Chile by investing in R&D and removing the market barriers preventing the industry from taking off.  The timing for such incentives couldn’t be more advantageous, as Chile’s first solar power plant was just approved on January 12th.  This 9 MW plant, located in the northern Antofagasta region, will be the first of six solar plants planned by the Spanish company, Solarpack.  Also, Copec, a major Chilean energy and forestry company, just opened its first renewable energy powered service station, with intentions to continue investing in renewables.

These announcements make me optimistic.  When President-elect Piñera takes office on March 11th, I hope his well-honed business skills will show him that Chile’s energy future does not lie with out-dated, large conventional power plants like HidroAysén or coal, but rather with the growing, dynamic market of renewables.  Perhaps this change in the country’s political leadership will further boost the already-emerging change in the country’s energy development.