The spot market is the default market of any generator that enters the Chilean system. In this market, only power generation companies generate energy. Its main characteristics are:

• In this market each generator sells or buys energy depending on the dispatch of its generating units and the contracts (supply).
• Generators sell all their produced energy in the spot market in the bar or injection node.
• Generators buy energy and the spot market to supply their contracts in the bar or supply node.
• Only generators participate in this market.
• Purchase and sale of electricity is conducted at short-term marginal cost (hourly) at the respective busbar or node where the electricity is withdrawn (for consumption) or where generators inject.
• The marginal cost is characterized by its volatility associated with short-term supply and demand shifts.
• Spot market transactions are calculated monthly by the Coordinator, once the actual values of the transaction are known.

The payment for capacity (or power) corresponds to an instrument to stimulate sufficiency in the electricity market, which is also consistent with the two-part marginal pricing scheme, where the peak period prices are different in the market in the rest of the time. Thus, in the case of electricity, part of the price is the energy that is associated with variable costs of production and is charged per unit of consumption. The other part, the capacity or power, is a charge for the availability to provide the service, which is possible through the installation of capacity, i.e. corresponds to an infrastructure development charge. In this way, the capacity charge includes the costs of providing this infrastructure, which corresponds to fixed capital costs, and is allocated among the consumers who demand in the peak conditions of the system.

Regarding to the spot market, the characteristics are as follows:

• Generators sell their recognized power in the spot market in the bar or injection node.
• Generators buy power in the spot market to supply their contracts in the bar or supply node.
• Only generators participate in this market.
• The purchase and sale of power is conducted at the nodal price for power at the respective busbar.
• The nodal price of power is calculated every six months by the CNE, in April and October. According to marginal theory, this price is based on the investment cost and on operational and maintenance costs (O&M) of a generation unit capable of supplying power to the system during peak demand.

The treatment of renewable energies is not decontextualized from the general scheme with which the Chilean system addresses payments for power or capacity, with the associated sufficiency and safety requirements. Figure 33 illustrates this situation, where the technologies or generation plants are distinguished without the assured availability of their primary energy source during the analysis period, for example wind power or fossil fuels that show problems in their supply. However, there may be renewable sources that if they guarantee a high availability of their capacity, such as biomass or geothermal.

S.D. N°62 of 2006 regulates power transfers between generating companies. Annex 3 describes the methodology for calculating the recognized adequacy power for each type of power plant.

The contract market corresponds to a market of the financial type with private contracts freely agreed between the parties. As long as a NCRE project is an electricity company, the valid procedure for any generating company in the sector is applied.

The requirement of quotas of generation of NCRE defined in Law 20.257 and Law 20.698 translates into the possibility of marketing, by any electric company that exceeds its obligation of non-conventional renewable energy injections, the transfer of its surplus to another electric company. This transfer can be commercialized bilaterally at freely agreed prices and independently of energy sales.