The complex energy transition of Chile’s “sacrifice zones”

Hundreds of people in Quintero and Puchuncaví have suffered illnesses related to industrial pollution, now the Chilean towns are seeing a shift to renewables
<p>A clean-up crew called in by AES Gener, owner of the coal-fired power plants operating in Quintero and Puchuncaví, regularly cleans the coal from the beach (Image: Saul Mansilla)</p>

A clean-up crew called in by AES Gener, owner of the coal-fired power plants operating in Quintero and Puchuncaví, regularly cleans the coal from the beach (Image: Saul Mansilla)

Standing on Punta Ventanilla, Carlos Vegas, 65, looks across at the industrial park which has been there most of his life. He looks at the impact of the 15 industries spread around the bay that connects the towns of Quintero and Puchuncaví, in central Chile.

Although he comes from a family of fishers, 20 years ago, the Chilean health authority prohibited him and his union from selling and cultivating mussels because they had high levels of cadmium, arsenic and copper. If people got sick, it would be his fault, he was told.

Carlos knows these waters of the Pacific like the back of his hand. He knows there will be deposits of coal on the beach tomorrow. He takes his mobile phone, looks at the data on the height of the waves in Puchuncaví, and said: “The tide is low, listen to me, tomorrow at eight in the morning, the beach will be full of coal.”

The next morning, a representative of the Navy — the maritime authority in Chile — walks along the coast and gives a warning. Coal is landing in Ventanas, the beach next to the industrial park. Immediately afterwards, a group of four artisanal fishermen, loaded with shovels and sacks, arrive to collect the coal left by the tide.

When the sea is calm, and the waves are low, the coal is left in the sand. “This is like when you have the cup of milk. If you leave it still, the cream comes out on top. If you move it, it sticks,” explained José Carvajal, 58, a lifelong artisanal fisherman. He is the coordinator of the cleaning group convened by AES Gener, owner of the three coal-fired thermoelectric plants that operate in the area.

During January 2021, Ventanas artisanal fishermen collected four tonnes of charcoal on the beach. Over the years it has become normal to see the sand turn black at sunrise. The Terram Foundation estimated the amount of coal at 832 tonnes between 2009 and 2020.

How does a popular tourism destination end up saturated with coal year after year? In 2017, the Navy’s Maritime Prosecutor’s Office carried out an investigation and concluded that the deposits were due to “the lack of control by AES Gener in the management of waste from its production processes”. The company appealed and an investigation was reopened. It has not yet concluded.

In 2020, AES Gener burned more than 1.4 million tonnes of bituminous coal, mainly from the US and Colombia. It arrived in the bay on ships. Mechanical shovels and cranes extracted it and dumped it on a conveyor belt that extends 1.4 kilometers out to sea from the coast, taking it to an outdoor storage field. This process has operated for decades in the port of Ventanas.

Coal-fired power accounted for 39% of electricity generation in Chile in 2019, the year in which President Sebastián Piñera made an unprecedented announcement. He pledged to close all 28 coal plants in this small South American country – that contributes scarcely 0.26% of global CO2 emissions – by 2040. The decarbonisation of the energy mix became Chile’s main climate commitment, and underpinned its m plan to achieve carbon neutrality.

Puchuncaví has ​​already started its transition, with the closure, in December 2020, of the “Ventanas 1” plant, which had been operating since 1964. But the challenge is not simple for an area that has lived for more than half a century with multiple environmental consequences.

Half a century of sacrifice

Between August and October 2018, 1,553 children and adolescents were treated for symptoms of poisoning, including dizziness, fainting spells, nosebleeds, and panic attacks in eight medical centers in the Valparaíso region, according to a report by the Children’s Ombudsman.

The Supreme Court, in an unprecedented ruling, affirmed that the state had failed to protect the inhabitants of Quintero and Puchuncaví. But, at the same time, the ruling could not determine who was responsible.

The industrial park includes, among others, an oil refinery; a copper concentrate smelter; a coal-fired thermoelectric complex; a chemical storage and discharge terminal; a cement production plant; a natural gas thermoelectric plant; a terminal that stores gas; another fuel discharge terminal; and a lubricant plant.

They are not responsible for any environmental liability or negative externalities or people’s health. When you are diagnosed with cancer, you are left alone.

In 2011, boys and girls from the rural school in La Greda were poisoned in March, August and November. The court proved Codelco’s responsibility for the mismanagement of its copper smelter. The school was relocated, to less than two kilometers away. In 2019, Chilean and US researchers published a study showing that children between the ages of one and five are at risk of cancer due to levels of exposure to arsenic in soils.

This industrial presence has not translated into positive development for the town. Puchuncaví records 27% of its population at poverty level, 7% higher than the national average, and 32% of its inhabitants lack access to basic services, 20% above the Chilean average.

Decarbonising the energy mix

Sebastián Piñera issued the order to close down the Ventanas 1 plant from the La Moneda, the presidential palace in Santiago on 29 December 2020. It was the oldest coal-fired thermoelectric plant in the country.

“It is a milestone in the energy history of our country,” said Fernanda Pinochet, regional ministerial secretary of energy for the Valparaíso region, who was present.

Three other coal-fired thermoelectric plants still operate in the Puchuncaví bay: Ventanas 2, Nueva Ventanas and Campiche. All owned by AES Gener.

“The closing of Ventanas 1 was the product of a tripartite effort between the company, the government and the union. We sat at the table to see what they needed and we were able to cover their needs completely,” said Pinochet. A total of 35 workers were part of the plant. Of these, 16 took early retirement and 17 were relocated to other plants in the same complex.

A resident of Quintero and Puchuncaví exercises on the beach, with the industrial park in the background
Residents of Quintero and Puchuncaví exercise on the beach, with the industrial park in the background (Image: Saul Mancilla).

Hernán Ramírez, a researcher at the Terram Foundation, describes the closure as window dressing from the government: “Ventanas 1 was the oldest and smallest, with very high operating costs. Last year, according to data from the Electrical Coordinator, it burned 3% of all the coal that was discharged into the bay and ran for 140 hours throughout the year. The closure has no effect.”

The NGO Chile Sustentable carried out a study in which they showed the different theories on what a fair transition would be. Its author, Claudia Fuentes, says that the Chilean government’s proposal “is more than anything a timetable. Decarbonising was associated with shutting down plants, but later challenges were not seen, such as reconversion, environmental remediation and everything that has to do with a just transition”.

Chile said that it will develop a “Just Transition Strategy” as part of is climate change pledge (NDC), the formal commitment to the Paris Agreement, which will be one of its pillars for the decarbonisation process. In the coming months, the ministry of energy will present the draft of the strategy.

The process, however, still does not generate much trust in the local community. “They are not responsible for any environmental liability or negative externalities or people’s health. Because when you are diagnosed with cancer, you are left alone,” said Katta Alonso, representative of the organisation Women in the Sacrifice Zone in Resistencia.

It would propose that any transition begins with the closure of the three remaining coal-fired plants, and of Codelco’s copper smelter. The next step would be the reduction of the industrial park so that no more companies are installed and that the community decides what will happen in the territory.

Chile’s renewable future

Since the Decarbonisation Plan announced in 2019, six thermoelectric plants have already closed in Chile. Another five will do so by the end of 2024 and the remaining 17 will shutter before 2040. The government signed a voluntary agreement with the four companies that own the plants for the winddown: AES Gener, Italy’s Enel, France’s Engie and the Chilean Colbún.

Although coal continues to be the main source of energy in Chile today, the rapid growth of renewables also accelerated its demise. In the last 6 years, Chile quintupled the capacity generated with solar, wind and hydraulic energy. The projections of the current government indicate that these energies cover 70% of the mix by the end of this decade.


of the electricity generation market in Chile is controlled by AES Gener

According to the ministry of energy, as of January 2021, there are 6,335MW of power plants under construction, of which 94% will generate renewable energy. The vast majority are solar and wind, which according to projections, will be able to cover all the fossil generation that Chile has today in 2040.

Investments in renewables come mainly from the same companies involved in decarbonisation: Enel, Engie and Colbún, which have been joined by other small players, in the country, such as Acciona.

However, the most important company in the whole process is AES Gener. It owns 14 of the 22 coal-fired plants operating today. Only Ventanas 2 will close before 2024. The rest are subject to new negotiations every five years. For Claudia Fuentes, AES Gener “has been the company most reluctant to change. They are the ones with the least commitment to shut down plants ”.

AES Gener controls 26% of the electricity generation market in Chile, with 3,541mw of installed capacity, of which 77% are today coal-fired thermoelectric plants. Although the company has expressed its interest in diversifying its parent company, its big bet in Chile is the Alto Maipo hydroelectric plant, which will add 531mw to its portfolio by the end of this year. This has been seen years of resistance from the local community who claim it would threaten the supply of drinking water in Santiago.

The company has announced the possible conversion of the infrastructure of its plants in Puchuncaví to seawater desalination plants or green hydrogen plants. In addition, a few weeks ago it announced the sale of its five coal-fired plants in Huasco to the WEG group as a step forward in its decarbonisation. However, WEG has not signed any closure commitments with the government.

*AES Gener was contacted to be part of this report but did not respond to interview requests.