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Annex 1.2 Regulations

Supreme Decree N° 327 officially entitled “Establishes Regulation of the General Law of Electrical Services” was enacted by the Ministry of Mining in December, 1997. This is an all-embracing regulation that seeks to include all the aspects regulated by LGSE, repealing provisions contained in disperse and partial regulations.

This regulation includes concessions, permits and easements, relationship between owners of electricity installations, customers and authority, as well as interconnection of installations, and installations and electricity equipment. It also includes service quality aspects, prices, fines and sanctions.

Supreme Decree N° 244 officially entitled “Approves Regulation for Non-Conventional and Small Generators” was enacted by the Ministry of the Economy, Development and Reconstruction in September, 2005. The decree creates provisions for companies whose generation capacity surplus is less than 9 MW (PMG and PMGD) and/or that operate with a non-conventional energy source (MGNC) with a capacity surplus of less than 20 MW.

The regulation includes the following chapters: Small Distributed Generators (PMGD) (Procedures and conditions for the connection, maintenance and intervention of installations, determination of costs of additional works for connection, operational regime, remuneration and payments, measurement and invoicing), Small Generators (PMG) (Operational regime, remuneration and payments, measurement and invoicing), Non-Conventional Generators (Classification according to source, exemption of payment for the use of main transmission systems, complaints and controversies).

This regulation was perfected to expedite the processing of the connection of the PMGD, especially for small PMGD (of up to 1.5 MW) that are cataloged as of non-significant impact by the S.D. N° 101 of 2015.

Supreme Decree N° 62 officially entitled “Approves Regulation for the Transfer of Capacity between Generation Companies Established in LGSE” was enacted by the Ministry of Economy, Development and Reconstruction in February 1, 2006.

The decree regulates transfers of capacity between companies with generation units synchronized to an electric system, resulting from the coordination of operations established by the LGSE. The chapters of interest are: Definitions, background and information to be used, maximum installed capacity and statistical control, allocation of adequacy power, initial power, preliminary power, definitive power, theoretical reserve margin, balance of injections and withdrawals, demand commitments, physical balance and valued balance.

Supreme Decree N° 113 entitled “Approves regulations that establish the provisions applicable to the ancillary services that each electric system must count for the coordination of the operation of the system in the terms referred to in Article 137 of the General Law of Electrical Services” was promulgated on November 28, 2017 and published in March 2019. However, the regulation of ancillary services was implemented after the approval of the report on the definition of the Ancillary Services Program, a fact that occurred on January 19, 2016. This new regulation establishes the way in which the services required by the National Electrical System and the mechanisms for providing and/or installing them will be defined. It also establishes how auctions, tenders and the provision and/or direct installation of the required services will be carried out

Promulgated on August 29, 2012, this decree regulates the prices transferable to the regulated customers of the distribution companies. In order to do this, it defines the short-term node prices and establishes the procedure for calculating it (simulation horizon, demand forecast, fuel prices, and availability of primary inputs of thermal power stations, treatment of hydroelectric plants, failure costs and rationing, in other aspects). It also defines aspects regarding the long-term node price (on the maximum value of bids for supply bids, indexation of long-term node prices, among others).

The Supreme Decree N° 114 entitled “Approves new regulations for the application of Law 19.657, on concessions of geothermal energy and repeals S.D. N° 32 of 2004, of the Ministry of Mining” was promulgated on November 15, 2012. This regulation sought to eliminate the lack of legal certainty in obtaining concessions for the exploitation of geothermal energy. Thus, it grants the exclusive right to an exploration concessionaire, to obtain an exploitation concession. In addition, it removes requirements to apply for a geothermal exploration concession and expedites the application process. This regulation was recently perfected by S.D. N° 46 of 2015.

Supreme Decree N° 71 entitled “Approves regulations of Law 20.571, which regulates the payment of electricity tariffs of residential generators” promulgated on June 4, 2014 establishes the connection procedure, deadlines and communications that must exist between the consumer, the electricity distribution company and the Superintendence of Electricity and Fuels. This regulation was perfected to streamline the processes of connection recently by S.D. N° 103 of July 2016.