Aes (TG:AES)
Historical Stock Chart

From May 2019 to May 2024

Chile's National Energy Commission said Thursday it will cut by 8.4% the average regulated electricity wholesale price, or node rate, generators charge distributors operating on the country's central electricity grid from May through October.

The reduction is due to the sharp drop in the price of fuels such as crude oil, coal and natural gas, according to the commission, known locally as the CNE.

The central electricity grid, or SIC, supplies some two-thirds of electricity to Chilean homes and industries.

In the northern SING grid, which supplies major copper mines and isn't interconnected with the SIC, the node rate will fall 19.8%, the commission added.

The commission adjusts the node rate, a theoretical price for electricity charged to regulated customers, every six months. The prices are based on the exchange rate between the U.S. dollar and the peso, 10-year power demand projections, utilities' capital-spending plans, water reservoir levels, the prices of oil, coal and natural gas, and variations in the producer price index.

The CNE also can re-adjust rates between these dates if any of the factors it takes into consideration vary more than 10% during the six-month period in which the regulated prices are valid.

The principal power companies supplying energy to the SIC grid are Empresa Nacional de Electricidad (EOC), AES Corp. (AES) through its Gener (GENER.SN) unit, and Colbun (COLBUN.SN).

As a result of the node rate cuts, consumers' electricity bills will fall an average 5% on the SIC grid and 13.1% on the SING grid, according to the CNE.

"This is the first rate cut in over a year on both grids, which is, undoubtedly, good news for consumers," said Energy Minister Marcelo Tokman.

-By Carolina Pica, Dow Jones Newswires; 56-2-820-4244; carolina.pica@dowjones.com