Approval of Punta Alcalde will secure electric power supply to behind-schedule mining projects
04-Dec-2012 Diario Financiero – News
Mayor of Huasco will have a recourse to law to revert judicial decision
Approval of Punta Alcalde will secure electric power supply to behind-schedule mining projects
Committee advanced mitigation measures which were accepted by Endesa. The project will guarantee power supply for 75% of 11 projects in the region
With a unanimous decision the Ministers Committee yesterday decided to revert the Corema of Atacama Region resolution and granted green light for the development of the Endesa’s 740 MW capacity Punta Alcalde thermoelectric plant that will require an investment of about US$1,400 million The plant could then secure electric power supply to 75% of the mining projects that are currently stopped and that would require about 1,500 MW by 2020.
Notwithstanding the above, the Committee decided to impose certain requirements to the plant in order to guarantee that “the air quality in the Valle de Huasco does not worsen”, the Sub-Secretary of Environment, Ricardo Irarrázabal, said. This will be accomplished, he explained, with a commitment from Endesa to invest in an “electrostatic precipitator for one of the CMP, CAP, uptake shafts”, he added, explaining that this is a condition for the plant be authorized to start up.
Jorge Bunster, Minister of Energy, stated “these are good news. This committee has taken a very diligent decision.” Endesa has communicated that this commitment that puts a condition over Punta Alcalde “will not only secure total reduction of equivalent emissions of this project (…) but will also generate a higher effect over the improvement of air quality in the Huasco region because of the location and characteristics of emitter. Besides, Endesa Chile has made the commitment to end operations of the diesel operated turbines (Central Huasco with 64 MW capacity) in Huasco once the Punta Alcalde project starts up”. The company said that these and other measures will require an additional investment amounting to US$40 million.
By obtaining this approval Endesa is enabled to move forward to the detail engineering stage, which would work as main contract bases, sources acquainted with the project said. A 70% of the line will go in parallel with current Guacolda Plant transmission lines to Maitencillo Sub-station. The remaining 30% will travel in parallel with Route C-480. The Environmental Impact Study is expected to be ready for submittal by April 2013.
However, Mayor of Huasco, Rodrigo Loyola, has asserted they will go to the Justice system in an attempt to revert the approval.
The winners
Mining projects that will be benefitted from the project are: Relincho that will require 200 MW by 2017, Cerro Casale with 158 MW by 2020, Caserones with 153 MW by 2014 and Pascua Lama, 130 MW, not including El Morro and other smaller operations. Besides, come consultants state that Punta Alcalde would grant the conditions to have a 25% cheaper generation than GNL. This is because, in spite of the plenty of shale gas existing in U.S.A. and its possible future exports, by 2018 the gas would have a price of no less than US$12/million BTU which is not good enough to compete against coal. For shale gas to compete against coal the shale gas price should be around US$8/million BTU, an executive officer familiar with the business sector states.
It is the opinion of María Isabel González, Consultant, that Punta Alcalde “could be an alternative supplier during drought periods and provide energy to the south region of country” and then she adds that another benefit “is that it would help the system reduce marginal costs by becoming less dependent on diesel”.
Executive Director of Environmental Evaluation Service, Ignacio Toro, added that the measure requirements will improve the air quality and he emphasized “if the project could not be carried out by a judicial decision, the air would then be worse than it will be once the project is implemented”.
This is possible because, he explained, the measure requires the project to take an equivalent amount of emissions to those produced by Punta Alcalde from another project, in this case the Pellets Plant of CMP which is much closer to the populated area.
Besides, Toro said that another requirement was set regarding water intake depth and its impact.
The process
Punta Alcalde was submitted for approval to the Environmental Impact Evaluation Service in 2009 and have several setbacks in the process. The project started the final evaluation stage in March this year when Endesa submitted the third Addendum after which a Corrections Report and a new Addendum were issued. Finally, on June 25, the Conama of Atacama Region decided to rule out the project.
In August 10, Endesa submitted a claim to the Ministers Committe headed by Minister of Environment ; whereas María Ignacia Benítez disqualified herself for having taken part of the Environmental Impact Survey at the early stage of the Endesa project. The committee is also made up by Ministers of Economy, Development and Tourism, Agriculture; Energy and Mining.
Project technology
In addition to the Committee’ s requirement based on a previous commitment of the company, Endesa also voluntarily accepted to set a maximum emission level of particulate matter to be 27 mg/Nm3, which improves in 10% the currently applied emissions standard.
However, one of the most remarkable points in the Punta Alcalde project is that this will be the first thermoelectric plant in Latin America to implement domes to cover the two yards where coal will be stock piled. Additionally, a filter system will be used to suppress the particulate matter and a wet desulfurization system to reduce SO2 emissions will be installed. Once the Punta Alcalde is operating four surveillance and monitoring systems will be provided thus becoming the most environmentally monitored plant in Chile.
Punta Alcalde will be one of the most efficient plants in the Chilean electric system with a generation capacity equivalent to 12% of SIC.
