Operation Statistics Central Interconnected System Load Economic Dispatch Center

Transcripción

1 2013 Operation Statistics Central Interconnected System Load Economic Dispatch Center

2

3 Contents Letter from the Chairman of the Board of Directors Letter from the Directors of Operations (I) and Tolls (I) Introduction Page 2 Page 4 Page 9 CHAPTER CHAPTER CHAPTER Page 23 Page 31 Page 47 History Background of Member Companies Owners of Generation, Transmission and Free Clients Facilities System s Operation of Term CHAPTER CHAPTER CHAPTER Page 83 Page 89 Page 119 Significant Aspects of the System s Operation During 2013 Transfers Among CDEC-SIC s Members Economic Background

4 Letter from the Chairman of the Board of Directors Juan Carlos Olmedo H. Chairman November, 2012/ November, 2013 Juan Cembrano P. Chairman November, 2013/ April, 2014 CDEC-SIC Operation Statistics Since its beginning, the Economic Load Dispatch Center of the Central Interconnected System, CDEC-SIC, has made available to the general public its Operational Statistics, a document showing the evolution of the main indicators in the electric market managed by it. On this opportunity, and on behalf of the Board of Directors of the CDEC-SIC, we are pleased to present you with the year 2013 version. Within this context, we report to you some of the main milestones occurred during last year which are related to the organization s progress and evolution. In the regulatory context, the publication of Supreme Decree N 115 from the Ministry of Energy should be highlighted, which amended Supreme Decree N 291 of the Ministry of Economy, and regulates the structure, operations, and financing of the CDECs. Among other issues, it changed the selection process of the members of the Board of Directors, whom shall be elected for a segment of member companies from a list of three candidates presented by a specialized external company. It must be also pointed out that such candidates shall neither be employees of the member companies nor be their independent advisor, which reaffirms the decision making autonomy inside the organization. Also, the number of Directors was decreased to five with their corresponding alternates, thus leveling the number of representatives for each segment of member companies. At the same time, a new mechanism was established for the search and selection of the CDEC-SIC s Technical Directors and a new Planning and Development Office was created, with significant tasks regarding analysis and studies related to the transmission systems. The multiple tasks undertaken by the organization inspired the decision of incorporating 16 new professionals during 2013, with the intention to incorporate a similar number during 2014 mainly as a result of structuring the new Direction of Planning and Development, and of the need to strengthen the already existing different areas. Considering the above, the Board of Directors decided to create a Human Resources Area, which was established during the last quarter of 2013 and which is responsible of strengthening, among other, aspects related to management of soft skills, development of human resources policies and performance management, aimed to keep the talent and to improve the capabilities of our staff. We trust that these decisions will allow us facing in a better manner the requirements of the regulatory framework ruling us. Concurrently, the implementation of the new

5 CDEC-SIC facilities was terminated, where the new staff of professionals will be located. In order to strictly comply with the CDEC-SIC s tasks, at the beginning of the month of May the Regulatory and Technical Comptrollership Direction was created, with the main task of providing cross support to the Technical Offices in the regulatory and methodological aspects. In this area, it is worth mentioning its contribution to the implementation and function of the Technical Offices procedures, and to the supervision in the audit of the coordinated companies. exceedance probability of 91% (that is, 91% of the years in the statistical data used by CDEC- SIC are wetter than the indicated water year). The electric system management shows favorable results, without any blackout situation during the term, with the energy not suplied from contingency events amounting to 24.9 GWh, which represents less than 0.05% of the SIC s total energy production. Nevertheless, it should be taken into account that a great part of such energy not supplied was originated by the strong earthquake that affected Copiapó area at the end of January, Regarding other issues of interest, during the last year the Board of Directors made progresses in the implementation of the autonomous function management of the CDEC-SIC organization. A preliminary study was requested and analyzed, oriented to materialize a new facility for the CDEC-SIC; progresses were made towards the creation of new Internal Regulations that include all the changes and adaptations experienced by the sector regulatory framework. The above tasks must be concluded during the current management. In the operational area, 2013 ended with indicators showing an expansion of the electric system in terms of either offer and demand offer and demand, reflected in: - 4.1% increase of the installed capacity % increase of energy production, totalizing 50,939 GWh % increase of energy sales in the system, totalizing 47,777 GWh (representing 70.1% of sales to regulated price clients, equivalent to 33,511 GWh) % increase in the annual maximum demand value, which reached a peak of 7,282 MW (recorded in December) % increase in the hourly maximum demand value, which reached a peak of 6,794 MW (recorded in June). Such growth was achieved under unfavorable hydrological conditions, resulting from the fourth consecutive year of dry characteristics. This has been reflected in the low hydric contribution to demand supply, which showed a 38.4% on average during the year. In line with the above, water year ends with a 2014 will be accompanied by significant challenges for us, among other the new requirements of the CDEC Regulations and the updated version of the Service Quality and Safety Technical Standard; the start-up of the CDEC-SIC s new SCADA at the CDEC- SIC; everything related to Ancillary Services, as well as the bidding processes to be carried out because of new necessary works in the Trunk Transmission System. We have prepared ourselves to live up to the new challenges. We end these words with a commitment to a maximum effort by the Board of Directors, to continue delivering a responsible, transparent and reliable work in order to continue giving the guarantee of independence to all agents in the sector. For this purpose, we have the most important asset: our people, highly qualified and suitable professionals that are part of this CDEC-SIC. Board of Directors Letter from the Chairman of the Board of Directors 3

6 Letter from the Directors of Operations (I) and Tolls (I) Rodrigo Barbagelata S. Ernesto Huber J. CDEC-SIC Operation Statistics As the (Interim) Directors of the CDEC-SIC Technical Offices we are pleased to report some of the tasks and activities carried out by these offices during Regarding regulatory aspects, the procedures referred to in Supreme Decree 130/2011 on Ancillary Services were prepared and submitted to the companies s consideration. In the area of the Operations Direction (DO), such procedures are referred to Quantification, resources availability and need to install and/ or implement equipment for SSCC rendering, Equipment costs statement for SSCC rendering, SSCC Operations Instructions and Verification and Follow-up of effective compliance by Ancillary Services ; while the Tolls Direction (DP) was in charge of preparing the procedure on SSCC Remuneration. As stipulated in theregulatory framework in force, disagreement on these issues by any company member of CDEC-SIC allows them to request a pronouncement of the Experts Panel on the matter that is the matter of discrepancy. Within this context, the DO procedure Equipment costs statement for SSCC rendering and the DP procedure SSCC Remuneration were presented to the Panel. Once discrepancies were solved, the SSCC procedures were presented for a favorable report those to the National Energy Commission (CNE). Also, the DP procedure Calculation and Determining Energy Economic Transfers and the DO procedure Development of Technical Audits on the CDEC-SIC were prepared and submitted for consideration to the companies. The DO Procedure on Audits was presented for a favorable report to the CNE in April, while the indicated DP Procedure was the subject of two discrepancies during the year. Regarding the first one the Experts Panel determined that the Procedure s preparation should be restarted, consequently the DP submitted a new version in October, with the purpose of submitting it as established in Article 10 of Supreme Decree 291/2007. The second discrepancy was presented in December, and the Panel s Decision remained pending until the beginning of In addition, by the end of the year the DP Procedure on Economic Transfers Measurement Systems had been submitted to the companies for comments. The aforementioned Procedure is part of the Invoicing Measures centralization project in progress at the DP, which purpose is to allow direct access to the information available in the measurement equipment installed in the system. For this reason, progress was made

7 In the meters homologation and in the preparation of the technical specifications of the economic transfer s measurement reception platform, a document that will be a part of the Bidding Terms to award the design and development of such platform. On the issues related to the Technical Standard or Grid Code and according with it, during 2013 the following studies were prepared and published: - Friday, May 17, final report Frequency Control Study and Reserves Determination. - Thursday, May 30, annual report on compliance level with the aspects indicated In Art Wednesday, July 17, final report Transmission System Constraints Study. - Thursday, August 29, final report Voltage Control and reactive power requirements study. - Tuesday, September 17, comments by DO and DP are submitted to the CNE, as well as by the coordinated companies to the new draft proposal version of the NT of SyCS, corresponding to its four-year review. - Tuesday, October 29, final version of EDAC Sub-frequency study. - Monday, November 11, publication of review on Defense Plan against Extreme Contingencies 2013 version. - Friday, November 29, final report Specific Study on the Service voltages. - Monday, December 16, publication of the studies calendar indicated in Article 1-9 of the NT of SyCS. - Monday, December 30, publication of final reports on Protection Coordination Verification Study and Continuation Study. Regarding new construction at the SIC s generation-transmission system, during 2013 the following incorporations were made, on the following dates. New generation works: - On Thursday, January 3, the Ucuquer eolic PMGD owned by Energías Ucuquer S.A. was incorporated, with a 7.2 MW capacity. - On Thursday, January 10, the Estancilla thermal PMGD owned by Generadora Estancilla was incorporated, with a 3.0 MW capacity. - On Monday, March 11, the Tamm thermal PMGD owned by Genera Austral S.A. was incorporated, with a 0.2 MW capacity. - On Friday, March 15 the Campiche coalfired thermal power plant owned by Empresa Eléctrica Campiche S.A. was delivered for exploitation, with a MW capacity - On Thursday, March 28, the Providencia hydro power plant owned by Hidroeléctrica Providencia was delivered for exploitation, with a 14.2 MW capacity - On Saturday, April 13, the last units of Talinay eolic farm owned by Parque Talinay Oriente S.A. were delivered for exploitation, with a total 90.0 MW capacity. - On Wednesday, April 24, the Roblería hydro PMGD, owned by Generadora Eléctrica Roblería was incorporated, with a 4.0 MW capacity. - On Thursday, April 25, Don Walterio hydro PMGD, owned by Generadora Eléctrica Rhom was incorporated, with a 3.0 MW capacity. - On Wednesday, May 1, the Laja CMPC biomass thermal power plant, owned by Bioenergías Forestales S.A. was delivered for exploitation, with a 25.0 MW capacity. - On Monday, May 6, the Ancali 1 thermal PMGD owned by Agrícola Ancali Ltda. was incorporated, with a 1.6 MW capacity - On Wednesday, May 22, El Arrayán hydro PMGD owned by Energías Renovables El Arrayán Ltda. was incorporated, with a 0.2 MW capacity. - On Thursday, May 23, Ensenada hydro PMGD owned by Hidroeléctrica Ensenada S.A. was incorporated, with a 1.2 MW capacity. - On Wednesday, May 29, MC1 and MC2 hydro PMGDs owned by HidroBonito S.A. were incorporated, with 9.0 and 3.2 MW capacity respectively. - On Monday, June 10, Hornitos solar PMGD owned by SubSole was incorporated, with a 0.3 MW capacity. - On Friday, June 28, Contra hydro PMGD owned by Contra S.A. was incorporated, with a 0.3 MW capacity. - On Monday, July 1, Viñales biomass thermal power plant owned by Arauco Bioenergía S.A. was delivered for exploitation, contributing with a total 22.0 MW surplus to the system. - On Saturday, July 27, Los Álamos thermal PMGD owned by SGA was incorporated, with a 0.8 MW capacity. - On Thursday, August 8, SDGx01solar PMG owned by SolaireDirect Chile S.A. was incorporated, with a 1.3 MW de capacity. - On Tuesday, September 3, Renaico hydro PMG owned by Mainco S.A. was incorporated, with a 6.3 MW capacity, as well as Santa Irene thermal PMGD owned by Genera Austral S.A., with a 0.4 MW capacity. - On Wednesday, October 9, Río Huasco hydro power plant owned by Hidroeléctrica Río Huasco S.A. was delivered for exploitation, with a 5.1 MW capacity. - On Thursday, November 14, Santa Cecilia solar PMGD owned by RERI Chile was incorporated, with a 3.0 MW capacity. - On Tuesday, December 10, Maisán hydro PMGD owned by Maisán S.A. was incorporated, with a 0.6 MW capacity. - On Friday, December 20, Salvador solar PMGD owned by RTS Energy was incorporated, with a 1.4 MW capacity. - On Monday, December 23, El Llano and Las Vertientes hydro PMGDs owned by E.E. Puntilla S.A. were incorporated, with 2.0 MW and 1.7 MW capacity respectively. With such incorporations plus the capacity increase at Coya (U5), Licantén, Los Colorados 2, Laja and Termopacífico power plant, at the end of 2013 the installed capacity at the SIC reached the amount of 14,147 MW. At the end of 2013, there were also generating power plant under commissioning process for a total around 300 MW, it is expected that their commercial operation start up will be complete during the first semester of The new transmission facilities were as follows: - On Friday, May 3, the SVC Plus at Diego de Almagro Sub-station owned by Transelec S.A.was delivered for exploitation, with +140/-100 MVAR. - On Sunday, July 7, the EDAGxCE acting on Guacolda power plant units was implemented and delivered for exploitation to control the transfers through Pan de Azúcar Punta Colorada Maitencillo 2x220 kv lines, in the event of contingencies in some of their circuits. - On Saturday, August 10, circuits 3 and 4 of Jahuel Chena 220 kv line owned by Transelec S.A. was delivered for exploitation. - On Tuesday, August 27, Mulchén Substation and circuit 1 of the 220 kv line Charrúa Mulchén and Mulchén Cautín were delivered for exploitation. Circuit 2 was delivered for exploitation on Monday, September 2. - On Sunday, September 1, ATR-8 of 500/220 kv, 750 MVA at Charrúa Sub- Station, owned by Transelec S.A. was Letter from the Directors of Operations (I) and Tolls (I) 5

8 CDEC-SIC Operation Statistics The implementation of the new SCADA continued during the year, with the connection of Coordinates to the Main Data Center almost ended with the performance of the connectivity and point-to-point tests delivered for exploitation. - On Sunday, September 29, Rahue Sub- Station of 220 kv, owned by Transelec S.A. was delivered for exploitation. - On Sunday, December 1, the 220 kv system to Isla de Chiloé, Melipulli-Chiloé transformer 220/110 kv and Chiloé Sub-Station 220 kv to Isla de Chiloé (transmission line) was delivered for exploitation. - On Friday, December 13, the CER equipment at Cardones Sub-Station +100/- 160 MVAR, owned by Transelec S.A. was delivered for exploitation. Regarding supervision and monitoring of the electric operation system, the implementation of the new SCADA continued during the year, with the connection of Coordinates to the Main Data Center almost ended with the performance of the connectivity and pointto-point tests, and starting the activities to incorporate Coordinates to the Back-up Data Center. During May and June, FAT tests of the project s Phase 2 were carried out (EMS-OTS Applications and other special developments) in Houston, USA, and progress was made to unify SCADA data bases and applications of the Network Manager version. During October the back-up systems (CCC) were transferred to Chile, as well as those of operators training (OTS) and development (PDS), with their installation and configuration process ending in December. At the end of the year the localization of the alternate CDC was defined, and preparation works started by contractor, including equipment and communication ways; these works should be finalized during Regarding the system security issues, during 2013 progress was made in the project to implement the Defense Plan against Extreme Contingencies, designed in its Phase 1 and 3 to deal with the failure and disengagement from the double circuit line Quillota Polpaico 220 kv, as well as the failure and disengagement from the San Luis Quillota 220 kv line respectively; and in its Phase 2, to face the failure and loss from the link Charrúa Ancoa 500 kv which also considers EDAC implementation as per frequency gradient at the facilities of coordinate companies. During the year were signed the contract with the awarded companies, starting up the implementation process. On the other hand, an Operation Study of the SIC s Northern Zone was carried out, with a span from 2014 to 2017, which proposes and automatic squeme to increase transfers from North to South, incorporating the eolic and solar ERNC projects intended to be connected to the SIC during With this it is expected to support better the ERNC s incorporation ERNC s and its characteristics, as well as the operation of a transmission system under congestions. On the other hand, improvements were made to the planning model for the mid and long term operation currently in use at the CDEC- SIC. Such improvements are oriented to the stability, parallel processing and convergence of PLP model, to the modelling of demand blocks and the representation of irrigation agreements with the corresponding reservoir management. Within the DP scope of action, at the beginning of the year the implementation of the SIC s Technical Information Data Base was finalized, and companies were supported in the process that allows them to directly complete the technical information required by the NTSyCS in such platform. In addition, as from April 1st the use of the new platform will be announced to Coordinates with the purpose of determining real marginal costs of the system thus making its calculation more efficient, with the possibility of questioning it by interested parties through our web page. In July, within the framework of the review process for the Trunk Transmission System expansion and the proposals to be issued by the DP, the National Energy Commission requested to incorporate in such proposal information on the improvements to be made at the sub-stations with the greater impact on the system. Accordingly, in August the selected company was instructed to proceed with the SIC SS/EE analysis and improvement study, where Alto Jahuel, Chena, Diego de Almagro and Charrúa SS/EEs were included. In October preliminary reports had been received corresponding to stage B of the study for each sub-station, and in November supplementary information was received. In December reports associated to the project s C stage were in progress, and finalization of the project is expected during the first quarter of Regarding the annual review of the Trunk Transmission System expansion plan corresponding to 2013, it was submitted in 6

9 October to the CNE, recommending among other works: Line 2x500 kv Pichirropulli Puerto Montt, energized with 220 kv; laying of the second circuit of Cardones - Diego de Almagro 2x220 kv line; Ibis conductor change with Grosbeak at the Loncoche - Valdivia 1x220 kv section; complete sectioning at Rahue Substation, Maitencillo Cardones 1x220 kv line amendment and capacity increase at Lo Aguirre Cerro Navia 2x220 kv section. On the other hand, regarding international biddings to be conducted by the DP for the new works of the Trunk Transmission System, during 2013 the works included in Decrees 82/2012 were granted: Ancoa Second Transformer 500/220 kv to Transelec S.A. and the New Lines 1x220 kv A. Melipilla - Rapel and 2x220 kv Lo Aguirre A. Melipilla, with the laying of one circuit, to Consorcio Saesa- Chilquinta. During this process no bids were received for the project 2x220 kv New Line Lo Aguirre Cerro Navia, consequently this process was declared null and void. In addition, during 2013 the process to grant the works contained in Decree 310/2013 was started: Autotransformers Sub-Stations Bank Nueva Cardones, Nueva Maitencillo and Nueva Pan de Azúcar, each of 500/220 kv, 750 MVA, and Third Autotransformers Bank 500/220 kv, of 750 MVA, at Alto Jahuel Sub-station, and the New Line 2x220 kv Lo Aguirre - Cerro Navia, of the Decree 82/2012 process which was declared null and void. All these works shall be granted during As per Sub-transmission Tolls, payment calculations were implemented in April as established in Decree Nº 14/2012 for Sub-transmission. In this process new methodologies were applied, such as to determine the corresponding Income Distribution Factors (FDI), distribution of rates and real losses, and the assignment of rates income. Given the complexity of such calculations, during this term calculation exercises were carried out which were submitted for comments to coordinated companies and meetings were carried out with the purpose of answering inquiries regarding their application. Towards the end of the year, the first payment calculation was published in November, corresponding to September 2013, consequently as of that date calculations are being issued so that companies can make corresponding payments. In the permanent search to facilitate the relationship and communication with stakeholders, in September we participated in an energy emergency simulation exercise developed by the Ministry of Energy and, at the end of the year, in October, conferences were developed related to application criteria for the Service Recovery Plans (PRS) by the head of CDC, together with the Operations Director (I). Such conferences were performed at Osorno, Concepción, Santiago and La Serena. Finally, on December 9 and 10 the Operations and Tolls Directions carried out the first technical seminar addressed to people responsible for communication between the companies and the Technical Offices of DO and DP from the member companies of this CDEC. On such occasion subjects related to Annual Review of the Trunk Transmission, Operational Studies at the CDEC-SIC, Operation Planning at the CDEC SIC and SSCC and its Procedures Regulation were introduced. As it may be noticed, our work has been intense. Contributing to the CDEC-SIC s management during 2013, with the support of its Board of Directors and the entire staff that professionally works at this company, it is a great satisfaction and at the same time an incentive to contribute with our effort so this CDEC is permanently a responsible, independent and successful organization in compliance of its duties. Regarding the Technical Audits to be carried out by the DP for the follow-up of the new trunk works, this year the ones corresponding to projects: New Line 2x220 Ciruelos- Pichirropulli: 1st circuit laying, New Line Cardones-Diego de Almagro: 1st circuit laying, CER installation at Cardones Substation and Lo Aguirre Sectioning Sub- Station were granted to ABSG Consulting. With this granting, a total 9 Technical Audits are currently in progress. Rodrigo Barbagelata S. Ernesto Huber J. Tolls Director (I) Operations Director (I) Letter from the Directors of Operations (I) and Tolls (I) 7

10 CDEC-SIC Operation Statistics

11 INTRODUCTION The Central Interconnected System of the Republic of Chile consists of transmission systems and power plants that operate interconnected from the Rada de Paposo in the North (Second Region), to the Isla Grande de Chiloé in the South (Tenth Region) This system is the largest in the four systems that provide electrical energy to the Chilean territory, with an installed capacity as of December 31, 2013 of 14,147.0 MW, and a supply coverage that reaches about 92.2 percent of the population. The Interconnected System of the Big North Region (SING) also functions along with the SIC in Chile as well as the Electrical System of Aysen and Magallanes for which the following summary statistics and most relevant aspects are shown. Introducción Introduction 9

12 National Statistics Systems (CONTINENTAL CHILE) Annual statistical table on energy production and peak demand, per system. System Gross Power 2013 Maximum Thermal Hydraulic Wind Solar Total Demand (GWh) (GWh) (GWh) (GWh) (GWh) (MW) SING 14, , ,226.0 SIC 30, , , ,281.8 AYSÉN MAGALLANES * Total 45, , ,466.4 Annual statistics table for an installation power system, according to the fuel type, at December 31, System Coal (MW) Oil (MW) Thermal Installed power according to the type of fuel Gas (MW) Others (MW) Hydraulic Run of the rivers (MW) SING 2, , SIC 2, , , , , AYSÉN MAGALLANES * Total 4, , , , , Dam (MW) Wind (MW) Solar (MW) System Thermal (MW) Total Installed Power Hydraulic (MW) SING 4, ,607.2 SIC 7, , ,147.0 AYSÉN MAGALLANES * Total 12, , ,900.2 Wins (MW) Solar (MW) System (MW) Annual statistical Electric System table of sales and coverage, at December 31, System Regulated (GWh) Customer Sales Population Coverage Industrials Total Sales (GWh) (GWh) Population % SING 1, , , ,054, % SIC 33, , , ,424, % AYSÉN , % MAGALLANES * , % Total 35, , , ,738, % * Represents the consolidate information of the three subsystems that make up the Magallanes System (Punta Arenas, Puerto Natales and Puerto Porvenir Subsystems). CDEC-SIC Operation Statistics

13 The following national map summarizes the most relevant statistics of each electric system. SING Northern Interconnected System Installed Power: 4,607 MW Annual Production: 14,101 GWh Highest Value of Demand: 2,226 MW Sales: 15,414 GWh Population: 6.30% SIC Central Interconnected System Installed Power: 14,147 MW Annual Production: 50,939 GWh Highest Value of Demand: 7,282 MW Sales: 47,777 GWh Population: 92.15% Aysén System Aysén System Installed Power: 44 MW Annual Production: 137 GWh Highest Value of Demand: 22 MW Sales: 118 GWh Population: 0.59% Magallanes System Magallanes System Installed Power: 102 MW Annual Production: 291 GWh Highest Value of Demand: 51 MW Sales: 266 GWh Population: 0.96% Introduction 11

14 This publication aims at summarizing the statistical information related to the operation of the Central Interconnected System, ordered by the Center for Economic Load Dispatch Central Interconnected System, CDEC-SIC and covers the last ten years of statistics, i.e., from 2004 to 2013, inclusive. The information presented includes the most relevant statistics of the operation as well as public values such as inflation rate, parity exchange rate, fuel price and other variables that affect, among other things, the decisions of operation in the Central Interconnected System. For a better analysis the information has been divided into six chapters, i.e. FIRST CHAPTER Shows the background to the founding of the CDEC-SIC, the corresponding legal framework and the functions assigned to it. SECOND CHAPTER Includes information on the facilities of the various Power plants and transmitters, such as power and voltages, years of service and length of lines. THIRD CHAPTER It refers to the operation of the system during the term It shows the changing demands and gross sales of the SIC and how they were supplied by different companies and plants involved. It shows the courses of the reservoirs of the Central Interconnected System resulting from the decisions of operation to minimize costs of supply, taking into account the hydrological conditions prevailing in each opportunity. Also included is the annual consumption of fuels per power plant. FOURTH CHAPTER It is dedicated to describe in particular the relevant aspects of the operation of the Central Interconnected System during We discuss criteria for planning the operation, the hydrological conditions of operation and the decisions made. FIFTH CHAPTER It summarizes the transfers between companies and includes an annual review of energy and power. It also shows the use of transmission system by calculating the payment of tolls and of the Unique Expected Annual Charges for end users. SIXTH CHAPTER It is about economic background used by the CDEC-SIC. It includes a history of inflation, parity exchange rate, fuel prices and monthly marginal average costs of SIC. CDEC-SIC Operation Statistics

15 CDEC-SIC STRUCTURE On May 31, 1999 the CDEC-SIC limited partnership was created, and structured according to the guidelines of Supreme Decree D.S. 327/97, with a Board of Directors formed by representatives from each of the 12 companies that were at the time members of the CDEC-SIC, an Operations Direction and a Tolls Direction. Following the publication in 2007 of DS 291/2007 of the Ministry of Economy, Development and Reconstruction which establishes the Structure, Function and Financing of CDECs, enacted in October 2009, a Administration and Budget Direction was created and the Board of Directors composition was amended to consist solely of 10 representatives corresponding to the 5 member segments as defined by said decree. Afterwards, in August 2013, Decree 115/2012 was enacted which introduced amendments to DS 291/2007, incorporating to the CDEC a Planning and Development Direction, and amending as of 2014 the Board of Directors composition by decreasing the number of Directors to 5 members and 5 alternates, each segment electing its representative from three selected candidates proposed for a specialized company retained for this purpose. The selected candidates for Director and Alternate of each segment must comply with the compatibility conditions as established in such Decree. Consequently, as of December 31, 2013, the CDEC-SIC structure was as follows: BOARD OF DIRECTORS CDEC-SIC Secretariat Communications Area Regulation & Technical Comptrollership Area Operations Direction Tolls Direction Planning & Development Direction Administration & Budget Direction Dispatch & Control Center Tolls Department Administration Department Operations Department Studies Department Information Technology Department Operations Planning Department Transfers Department Human Resources Electric Systems Studies Department Introduction 13

16 As of December 31, The Board of the CDEC-SIC is integrated by the following members: Segment Regular Director Alternate Director First Segment Juán Carlos Olmedo H. (19) Jean Descazeaux A. (13) First Segment Luis Núñez H. (16) Soledad Salas M. (12) Second Segment Leonardo Bastidas A. (15) Juan Salinas U. (14) Second Segment Carlos Aguirre P. (11) Juán Pablo Cárdenas P. (6) Second Segment Humberto Espejo P. (2) Osvaldo Muñoz D. (17) Third Segment Rodrigo López V. (18) Jaime Cancino C. (3) Third Segment Raúl Valpuesta A. (1) Belisario Maldonado M. Fourth Segment Carlos Ducasse R. (10) Marcelo Bobadilla M. (9) Fourth Segment Mauricio Dinamarca C. (5) Mauricio Camposano I. (4) Fifth Segment Juán Cembrano P. (7) Andy García C. (8) First Segment: Correspond to the Power Plants owners whose total installed capacity is below 300 MW. Second Segment: Correspond to the owners of the power plants whose total installed capacity is equal to or grater than 300 MW. Third Segment: Correspond to the owners of the transmission trunk installations. Fourth Segment: Correspond to the owners of the subtransmissions installations. Fifth Segment: Correspond to the customers that receive supply directly from a transmission system CDEC-SIC Operation Statistics

17 The Board of Directors of the CDEC-SIC is joined by: CDEC-SIC Ltda. Executive Director (A) Ernesto Huber J. Director of Operations (I) Ernesto Huber J. Tolls Director (I) Rodrigo Barbagelata S. Administration and Budget Director (I) Ignacio Hidalgo P. Operations Assistant Director Ernesto Huber J. Tolls and Transfers Assistant Director Rodrigo Barbagelata S. Regulation and Technical Comptrollership Deputy Manager Jaime Misraji C. Dispatch and Control Center Manager Ricardo Pacheco M. Operations Department Manager Sergio Díaz C. Operations Planning Department Manager Juán Marco Donoso N. Electric Systems Studies Department Manager José Miguel Castellanos I. Tolls Department Manager Aníbal Ramos R. Studies Department Manager Deninson Fuentes D. Administration Department Manager Ignacio Hidalgo P. Information Technologies Department Manager Álvaro Navarro M. Human Resources Manager Sebastián Benavente N. Introduction 15

18 Corporate Definitions Corporate definitions are meant to be a model to increase management, ethical and transparence standards during the internal decision making process of the CDEC-SIC, taking into account the compliance with the objectives established for the organization by the Electric Services General Law. CDEC-SIC Operation Statistics Vision Our efforts are oriented towards becoming a model of excellence; independent, impartial, transparent and proactive for the safe and efficient management of the SIC, applying the industry s best practices at a global level and making a contribution to the integral development of its coordinates. Mission Our mission is based on operating the SIC in a safe manner and at the lower possible cost, guaranteeing open access to the transmission system, contributing to the country s development through the efficient fulfillment of the role assigned by the legislation in force. Values Values that are the pillars of our function are based on aspects related to: Integrity: We are honest, ethical and reliable in the internal interaction and with our stakeholders, reflecting the highest professional standards of our organization. Respect: Beyond compliance with the standards and the functions derived from them towards our professionals, member companies, authorities and the community in general, we take into account their points of view, their needs and opinions. Service: We offer unbiased collaboration when complying with our mission from the smallest details to the solution of important contingencies, showing our high sense of collaboration to make life easier to the fellow citizens. Our right intention and the awareness of our role will always be the basis to live according to this value. Equity: Understood as the fair and balanced treatment in the compliance with our functions and with respect to our professionals and the entire community.

19 2013 Management In addition to comply with all the aspects required by the Regulations and standards, the Technical Offices of the CDEC-SIC carried out several activities during 2013 aimed to reinforce aspects allowing for a better action within the electric market and all its participants. REGULATORY AREA - Preparation of the procedures on Supplementary Services as required in DS 130/ Preparation of the procedures on Development of Technical Audits, Calculation and Determination of Energy Economic Transfers and Measurement Systems for Economic Transfers. - Participation in discrepancies submitted to the consideration of the Experts Panel by the member companies, referred to in the procedures Statement of equipment costs for rendering SSCC, SSCC Remuneration and Calculation and Determination of Energy Economic Transfers. - Issue of the studies required by the Technical Standard, together with the report on comments and remarks to the draft proposed by the CNE for the new version of the NTSyCS. OPERATIONAL AREA - Progress in the implementation of the new SCADA for the CDEC-SIC, which contemplated carrying out connectivity and point-to-point tests with coordinates; enabling the back-up Data Center; signature of FAT tests for Phase 2 in the USA; installation and configuration of back-up systems (CCC), operators training (OTS) and development (PDS), developing training courses for users of the new system. - Start-up of implementation works for CDC alternate facilities, their equipment and communications. - Start-up of implementation process for the Defense Plan against Extreme Contingencies, designed in its Phase 1 and 3 to service the failure and disengagement of Quillota Polpaico 220 kv double-circuit line, as well as the failure and disengagement of San Luis Quillota 220 kv line respectively; and in its Phase 2, to face the failure and loss of the link Charrúa Ancoa 500 kv (failure in both circuits or in 220/500 kv transformations) which also consider the implementation of EDAC as per frequency slope at the facilities of coordinate companies. - Start-up of improvements implementation to the operation planning model in the mid and long term currently in use at the CDEC-SIC (PLP model). Such improvements are oriented to figures stability and parallel processing, together with the modelling of demand blocks and representation of risk agreements with the management of the corresponding dams. - Development of Operation Study for the SIC s Northern Zone (years 2014 to 2017), with an automation proposal to increase transfers from North to South, incorporating ERNC eolic and solar projects which connection to the SIC is estimated in INVOICING AND TOLLS AREA - Start-up of the Invoicing Measurement centralization project, in order to gain direct access to the information available in the measurement equipment installed in the system. - Granting of the works contained in Decree 82/2012, and start-up of the granting process of the works contained in Decree 310/2013 (international biddings). - Development of the new Sub-transmission Tolls calculation methodologies, according to Decree N 14/ Within the framework of the review process of the Trunk Transmission System expansion, the DP carried out the SIC s Sub-stations analysis and improvements study. - Assigning new Technical Audits for trunk works in progress, amounting as of December 2013 to a total 9 audit processes in progress. Introduction 17

20 Public Relations Activities VISIT TO ENERGY COMMISSION OF THE SENATE The CDEC-SIC Operations and Tolls Interim Directors attended a meeting with the Senate s Mining and Energy Commission at the end of last year in order to express their opinion on the SIC and SING Interconnection Law project. On that opportunity, they explained that if included in the trunk expansion plan, an eventual interconnection should go through an assessment process of its technical and economic convenience. CDEC-SIC PARTICIPATED AT IMPORTANT ENERGY EVENTS Integration Commission (CIER), was attended by the Operations Director (I) and by an engineer from the Regulation and Technical Comptrollership s Office. CDEC-SIC Operation Statistics Participation at events related to the energy area, both in Chile and abroad was an outstanding characteristic of the CDEC-SIC s public agenda during On July 2 and 3, for example, Concepción city, the capital of Bío- Bío Region witnessed the first version of the Electricity Forum of the South (FOROSIC 2013), an event sponsored by the CDEC-SIC, as well as a conference by the Operations Director (I). Later, and with the attendance of the top executives from the main electric system operators of Latin America, on September 23 to 25 the International Congress on Energy Systems and Markets Operation was held at Medellín, Colombia, which main subject was: Current and Future Challenges in the SEPs Operation. This gathering, organized by the Regional Energy On October 29, the seminar Challenges of the Modern Electric Systems organized by CONECTA company was held, where the CDEC-SIC s Interim Operations Director participated with the conference: Challenges of Chile s Central Interconnected System operation coordination. It is worth noting that Dr. Vahid Madani, currently Director of the Smart Grid Initiative of Pacific, Gas and Electric (PG&E), nominated IEEE Fellow in acknowledgment of his innovation and leadership in technologies to protect power electric systems and control technologies for wide spectrum monitoring systems participated at this seminar. Continuing with this process of corporate promotion, on November 11 the Operations Director (I) participated at one of the panels of the Sixth version of the International Biennial Congress Cost Variability in the Electric supply, carried out by the CIGRE s Chilean Committee, where the electricity high costs in the local market issue and its causes, consequences in the productive sectors and possible solutions were discussed. The year ended with the attendance to the 2nd International Exhibition and the IX Round of Business for Atacama Region ATEXPO 2013 (from November 12 to 15), opportunity where the regional energy scenario was approached. On this occasion, our DO (I) made a presentation on the Challenges of the SIC s Operation Coordination.