102 Luis E. Gonzales Carrasco and Rodrigo Cerda
Conclusions
Chile is facing new and complex demands as a result of its economic progress.
One of those demands is moving to a low- carbon economy while keeping economic growth on the same path. For this purpose, the government actively promotes renewable energy to reduce GHG emissions, relying on the significant
potential of renewable energy in Chile. In order to support the diffusion of the
respective technologies with market instruments, the government of Chile
recently introduced a carbon tax.
This tax, however, will create an unintended collateral problem – a consequential risk – affecting disproportionally the most vulnerable portions of the
population. In a scenario where levels of penetration of solar technologies for
the electric generation interacts in four different mixes of energy, 15.7% of
Chilean households are in energy poverty. Without economic compensation
and with a variation of carbon tax from $5–40/ton of CO 2 , it would lead to a
16.2% increase in the proportion of households in energy poverty. If the government decided to compensate the most vulnerable in the population, the cost
would be between US$9.3 and US$15.5 million for a programme that left
households at at least the same level of wellbeing and comfort as before the tax.
Apart from the risk of increasing energy poverty, we identify an uncertainty
of the behaviour of citizens towards renewable energy promotion. This emerges
after a rich exchange of ideas with stakeholders at the point of building the
scenarios. Moreover, we identify implementation risks that at the moment are
not quantifiable because of the lack of detailed information at household level,
these being the monetary cost of substituting biomass- wood by electricity if this
is considered an option for heating at household level, and the multidimensional
risk in the mix of quantitative and qualitative perceptions of the stakeholders
can be seen (see Figure 6.2).
2
Notes
1 Researcher in Tenaris until February 2018.
2 We would like to thank Hernan de Solminihac and Leonardo Hernandez (director
and co- director of Clapes UC at Pontificia Universidad Católica de Chile); Felipe
Larrain (Minister of Finance of Chile and former director of Clapes UC), Luis Abdón
Cifuentes, Carmen Gloria Contreras, Jenny Magger, Marek Antosiewicz, and
Sebastian Vicuña, presenters in the second seminar of Clapes UC and TRANSrisk
‘Medición y gestion del cambio climático’; the entire team of Red de Pobreza
Energética; Luis Cuervo- Spottorno (Primer Consejero of the European Union
delegation in Chile), with Alejandro Zurita (Chief of Science, Technology and
Innovation at Servicio Europeo de Acción Exterior of the European Union) and
Leticia Celador (trade and economic adviser at the European Commission delegation
in Chile).
Conclusions
Chile is facing new and complex demands as a result of its economic progress.
One of those demands is moving to a low- carbon economy while keeping economic growth on the same path. For this purpose, the government actively promotes renewable energy to reduce GHG emissions, relying on the significant
potential of renewable energy in Chile. In order to support the diffusion of the
respective technologies with market instruments, the government of Chile
recently introduced a carbon tax.
This tax, however, will create an unintended collateral problem – a consequential risk – affecting disproportionally the most vulnerable portions of the
population. In a scenario where levels of penetration of solar technologies for
the electric generation interacts in four different mixes of energy, 15.7% of
Chilean households are in energy poverty. Without economic compensation
and with a variation of carbon tax from $5–40/ton of CO 2 , it would lead to a
16.2% increase in the proportion of households in energy poverty. If the government decided to compensate the most vulnerable in the population, the cost
would be between US$9.3 and US$15.5 million for a programme that left
households at at least the same level of wellbeing and comfort as before the tax.
Apart from the risk of increasing energy poverty, we identify an uncertainty
of the behaviour of citizens towards renewable energy promotion. This emerges
after a rich exchange of ideas with stakeholders at the point of building the
scenarios. Moreover, we identify implementation risks that at the moment are
not quantifiable because of the lack of detailed information at household level,
these being the monetary cost of substituting biomass- wood by electricity if this
is considered an option for heating at household level, and the multidimensional
risk in the mix of quantitative and qualitative perceptions of the stakeholders
can be seen (see Figure 6.2).
2
Notes
1 Researcher in Tenaris until February 2018.
2 We would like to thank Hernan de Solminihac and Leonardo Hernandez (director
and co- director of Clapes UC at Pontificia Universidad Católica de Chile); Felipe
Larrain (Minister of Finance of Chile and former director of Clapes UC), Luis Abdón
Cifuentes, Carmen Gloria Contreras, Jenny Magger, Marek Antosiewicz, and
Sebastian Vicuña, presenters in the second seminar of Clapes UC and TRANSrisk
‘Medición y gestion del cambio climático’; the entire team of Red de Pobreza
Energética; Luis Cuervo- Spottorno (Primer Consejero of the European Union
delegation in Chile), with Alejandro Zurita (Chief of Science, Technology and
Innovation at Servicio Europeo de Acción Exterior of the European Union) and
Leticia Celador (trade and economic adviser at the European Commission delegation
in Chile).