Chile has established itself as an attractive destination for investment in projects and infrastructure, backed by its economic stability, policies that promote private sector participation, and the need for sustainable infrastructure that is resilient to climate change and grid saturation. In this regard, we highlight that for 2025 there are several initiatives, including a desalination plant and a HVDC (High Voltage Direct Current) line.
1. Investment Opportunities in Projects and Infrastructure in Chile
- The General Directorate of Public Works Concessions (Dirección General de Concesiones de Obras Públicas or DGC) belonging to the Ministry of Public Works (Ministerio de Obras Públicas or MOP) published the call for public bidding for the concession of the Desalination Plant for the Coquimbo Region.
- The National Energy Commission (Comisión Nacional de Energía or CNE) approved the Preliminary Technical Report (Informe Técnico Preliminar or ITP) of the Annual Transmission Expansion Plan for the National Electric System (Sistema Eléctrico Nacional or SEN) for the year 2024.
- The MOP announced its bidding plan for the year 2025 which contemplates a budget of 2.2 trillion Chilean pesos for this year, with 560 projects planned throughout the country, which represents a significant opportunity for investors in the sector. It is worth noting that this led to a record budget for 2025 of 3.8 trillion Chilean pesos.
2. Current and Future Investment Projects in Chile
- International public bidding for the concession of the Desalination Plant for the Coquimbo Region: the future concession contemplates the design, construction, conservation, maintenance and operation of the works in order to produce water suitable for human consumption and multipurpose purposes. The estimated budget for the project is 8,195,000 UF or Unidades de Fomento (approximately US$350 million).
- The Preliminary Technical Report of the Annual Transmission Expansion Plan for the SEN: this plan for the year 2024 contemplates 34 expansion works, whose investment amounts to a total of approximately US$ 2,259 million. The great innovation of this Plan is the project of a new HVDC (High Voltage Direct Current) system “Lo Aguirre - Entre Ríos” whose estimated investment amount would be US$ 1,300 to 1,500 million.
- MOP’s Bidding Plan 2025: this plan launched in December 2024 establishes a roadmap for sustainable territorial development and contemplates 560 projects with a budget of 2.2 trillion pesos. It includes projects in different regions of the country carried out by the Directorates of Roads, Architecture, Hydraulic Works, Airports, Port Works and the Rural Sanitary Services sub-directorate.
- Metro Expansion and Electric Mobility: In addition, public transportation solutions are being implemented to improve the quality of urban life, including the expansion of Santiago Metro and the adoption of electric mobility technologies. In this regard, the Development Bank of Latin America and the Caribbean (CAF) approved a US$300 million fund for the modernization of the Santiago Metro.
3. Challenges and Opportunities for Investors in Chile
Challenges:
- Bureaucratic processes and approval times can delay project execution.
- Adaptation to constantly evolving environmental and social regulations.
- Environmental assessment, processing of sectoral environmental permits, and especially in terms of community relations and land management.
- It is likely that the Ministry of Energy will decide to submit the Lo Aguirre - Entre Ríos HVDC Project to the fringe study procedure (estudio de franjas or EdF), which would impact the project's development period and extend its commissioning date. It is estimated that, between the study bidding, its development, the Strategic Environmental Assessment and its approval, it would add approximately 2 years to the development of the transmission project. The analysis as to whether or not the Lo Aguirre - Entre Ríos HVDC project will require a Fringe Study will be critical for its progress within the timeframe estimated in the ITP.
Opportunities:
- Participation in a booming market with an unprecedented public investment plan.
- Collaboration in sustainable infrastructure projects that are resilient to climate change and grid saturation.
- Access to transparent tenders and a legal framework that protects foreign investment.
4. Main Government Regulations and Policies
- General Law of Electric Services (DFL No. 4 of 2006, of the Ministry of Economy, Development and Reconstruction, which establishes the consolidated, coordinated and systematized text of DFL No. 1 of 1982, of the Ministry of Mining): regulates the activities related to the production, generation, transmission and distribution of electric power in the country.
- Public Works Concessions Law (MOP Decree No. 900) and its Regulations (Supreme Decree MOP No. 956 of 1997): establishes the legal framework for the participation of the private sector in the development of public infrastructure through concessions.
- Law of Bases on Administrative Contracts for Supply and Provision of Services (Law No. 19,886): regulates public procurement processes, establishing principles of free access to bids, competition, publicity, transparency and equal treatment.
- General Instructions No. 6 of the Court for the Defense of Free Competition (TDLC): contains a set of specific rules to safeguard free competition and limit discretion and arbitrariness in the design of bidding processes for the execution of municipal public works and in their bases.
Nicolás Yuraszeck | Partner
nyuraszeck@prieto.cl
Emilia Valenzuela | Associate
evalenzuela@prieto.cl