Law 19,657 on Geothermal Energy Concessions

Country	Chile
Year Implemented	2000
Policy Status	In force
Agency	•Ministry of mine and natural resources
Further Information	•www.minenergia.cl/minwww/opencms/
Policy Type	•Incentives/Subsidies •Policy Processes   •Institutional Creation •Public Investment   •Infrastructure Investment •Regulatory Instruments   •Regulatory Reform   •Standards
Policy Target	•Geothermal   •Heat   •Heat Store   •Power
Policy Sector	•Framework Policy
Description	Law 19,657 establishes regulatory frameworks for geothermal exploration and exploitation, as well as standards for concession allocation and tenders. The Ministry of Mines and Natural Resources is responsible for the application, control and enforcement of geothermal regulation frameworks and the management of auction and bidding processes. Annual public bidding for concession granting will occurs once a year and is open to every Chilean person or corporate body organised under Chilean laws. The legislation regulates the relationships between the government and concession holders, owners of surface lands, mining properties or water exploitation rights when exploiting geothermal energy. Safety conditions to be maintained while carrying out geothermal activities are also implemented. In order to attract international investment in the geothermal energy sector, the Chilean government enhanced the financial incentive tools contained in Law 19,657. Since 2009, companies faced with unsuccessful digging experiences can apply for compensation, from 70% of their initial investment for the first well, to 50% for the second and 30% for the third. They are insured a maximum of USD 8 million dry-well insurance. In 2009, Chile auctioned off exploration rights for over fifty sites and provided exploitation permits to eight more.
URL	www.minenergia.cl/minwww/export/sites/default/08_Normativas/02_energias/descargable_renovables/ley_geotermia_ingles_xDoc_6_-_2x.pdf