By Juan Zapata Hassi and Florencia Ortúzar Greene*
Chile is undergoing a decarbonization process that has led to the closure of several coal-fired power plants. The energy transition is happening, but what about justice?
Norgener's last burning
In December 2023, and in the context of the decarbonization process, the company AES requested authorization from the National Energy Commission (CNE) to close early the two units of the Norgener Thermoelectric Power Plant in Tocopilla, which produced energy by burning coal.
A few days later, the company bought 35,000 tons of coal, which, added to what was already available, resulted in a surplus of approximately 94,000 tons of coal.
In February 2024, one day after the National Energy Commission (CNE) authorized the early closure of the power plant, AES requested exceptional authorization from the National Electric Coordinator (CEN) to burn all the remaining coal, bypassing the dispatch order established by law. The company argued that its Environmental Qualification Resolution (RCA) only permitted burning at the power plant itself and did not contemplate alternatives such as selling or transporting the coal.
Why was this coal burning exceptional?
The dispatch of energy sources in Chile is governed by the principle of "economic order." This means that, to determine which energy sources enter the grid, the National Energy Commission (CEN), responsible for maintaining order, must prioritize the least expensive energy sources.
It so happens that the cheapest energy sources are also the cleanest: non-conventional renewables. Those who generate renewable energy don't pay for sunlight or wind power, unlike companies that generate energy from fossil fuels, which do pay for coal, gas, or oil. Thus, even without considering environmental or climate factors, coal-fired power plants are only useful if clean energy sources fail to meet the demand of the electrical grid.
However, with the closure of the Norgener thermoelectric plant, the National Energy Commission (CEN) made an exception, authorizing AES to burn its remaining coal more quickly, bypassing the dispatch order established by law. Thus, more than 90,000 tons were burned in approximately two months, without any real priority.
The litigation in favor of the communities
Together with our allied organizations Chile Sustentable and Greenpeace, we took the case to the Court of Appeals, filing an injunction on behalf of those affected by the forced burning in Tocopilla. We argued that the National Energy Commission (CEN) acted unjustly by failing to consider the environmental impact of its decision and by not exploring alternative ways to manage the coal: Why not transport or sell it to another company? Why not postpone the closure until the power plant could burn the coal properly and on schedule, without rushing the process?
We considered it unfair and dangerous to disregard dispatch regulations without sufficient justification. Furthermore, the same Environmental Impact Assessment (EIA) that the company used to claim it had no option but to prioritize burning the coal also mandated the development of a Decommissioning Plan for the plant before its closure. This plan, which was never drawn up, should have addressed the disposal of the remaining coal.
But the injunction to stop the damage was rejected by two votes to one, and the remaining coal finished burning.
Even though the damage had already been done, the organizations behind the case continued to litigate, in recognition of the rights of those affected and to prevent a dangerous precedent. With the decarbonization process underway, many other power plants would close, and it was necessary to prevent this event from happening again. However, on November 27, 2024, the Supreme Court closed the case, rejecting our position.
Two milestones that add value to the process
Although the ruling was unfavorable, it is possible to highlight two key aspects:
- Recognition of broad standing in environmental litigation. Both the Court of Appeals and the Supreme Court recognized broad standing to file for protection, allowing individuals and foundations domiciled in Santiago to bring legal action regarding environmental damage in Tocopilla, a city located more than 1,000 km away. This sets a valuable precedent for access to environmental justice in Chile.
Regulations for the retirement of thermoelectric plants. During the trial, the National Electricity Commission (CEN) issued a directive entitled “Internal Procedure: Retirement Program for Conventional Thermal Generating Units of the National Electric System,” which establishes new rules for the retirement of thermoelectric plants. The document requires companies to submit a retirement program, regulates the extraordinary purchase of fuel, and outlines exceptions to the energy dispatch order outside of the economic order.
On this last point, the instruction establishes two requirements to authorize an exceptional burning of stock : having a document issued by the competent environmental authority that certifies that the stock cannot be moved, and a certification that the remaining stock originated for justified reasons.
While the legality of these exceptions remains questionable, it is noteworthy that an instrument has been enacted to regulate these situations—the first of its kind. The fact that it was published right at the time of the trial demonstrates that the extraordinary burning in Tocopilla was not carried out in accordance with regulations and also acknowledges the need for greater control and transparency in these processes.
Final reflections
The case of Tocopilla highlights the complexities of the energy transition process we are experiencing. While we celebrate the closure of coal-fired power plants, we cannot allow this to justify environmentally regressive actions.
The transition must be framed within principles of justice, inclusion, and respect for human and environmental rights. Only in this way can we seize this opportunity for change, without repeating the mistakes of the past, to put an end to fossil fuels that disrupt the planet's natural balance.
For now, it is necessary to continue working to achieve guarantees that prevent unfair situations under the guise of the energy transition, such as the one suffered by those who live in Tocopilla.
*Juan Zapata Hassi is a lawyer and fellow at the Inter-American Association for Environmental Defense (AIDA), and Florencia Ortúzar Greene is the director of AIDA's Climate Program.
By Juan Zapata Hassi and Florencia Ortúzar Greene*
Chile is undergoing a decarbonization process that has led to the closure of several coal-fired power plants. The energy transition is happening, but what about justice?
Norgener's last burning
In December 2023, and in the context of the decarbonization process, the company AES requested authorization from the National Energy Commission (CNE) to close early the two units of the Norgener Thermoelectric Power Plant in Tocopilla, which produced energy by burning coal.
A few days later, the company bought 35,000 tons of coal, which, added to what was already available, resulted in a surplus of approximately 94,000 tons of coal.
In February 2024, one day after the National Energy Commission (CNE) authorized the early closure of the power plant, AES requested exceptional authorization from the National Electric Coordinator (CEN) to burn all the remaining coal, bypassing the dispatch order established by law. The company argued that its Environmental Qualification Resolution (RCA) only permitted burning at the power plant itself and did not contemplate alternatives such as selling or transporting the coal.
Why was this coal burning exceptional?
The dispatch of energy sources in Chile is governed by the principle of "economic order." This means that, to determine which energy sources enter the grid, the National Energy Commission (CEN), responsible for maintaining order, must prioritize the least expensive energy sources.
It so happens that the cheapest energy sources are also the cleanest: non-conventional renewables. Those who generate renewable energy don't pay for sunlight or wind power, unlike companies that generate energy from fossil fuels, which do pay for coal, gas, or oil. Thus, even without considering environmental or climate factors, coal-fired power plants are only useful if clean energy sources fail to meet the demand of the electrical grid.
However, with the closure of the Norgener thermoelectric plant, the National Energy Commission (CEN) made an exception, authorizing AES to burn its remaining coal more quickly, bypassing the dispatch order established by law. Thus, more than 90,000 tons were burned in approximately two months, without any real priority.
The litigation in favor of the communities
Together with our allied organizations Chile Sustentable and Greenpeace, we took the case to the Court of Appeals, filing an injunction on behalf of those affected by the forced burning in Tocopilla. We argued that the National Energy Commission (CEN) acted unjustly by failing to consider the environmental impact of its decision and by not exploring alternative ways to manage the coal: Why not transport or sell it to another company? Why not postpone the closure until the power plant could burn the coal properly and on schedule, without rushing the process?
We considered it unfair and dangerous to disregard dispatch regulations without sufficient justification. Furthermore, the same Environmental Impact Assessment (EIA) that the company used to claim it had no option but to prioritize burning the coal also mandated the development of a Decommissioning Plan for the plant before its closure. This plan, which was never drawn up, should have addressed the disposal of the remaining coal.
But the injunction to stop the damage was rejected by two votes to one, and the remaining coal finished burning.
Even though the damage had already been done, the organizations behind the case continued to litigate, in recognition of the rights of those affected and to prevent a dangerous precedent. With the decarbonization process underway, many other power plants would close, and it was necessary to prevent this event from happening again. However, on November 27, 2024, the Supreme Court closed the case, rejecting our position.
Two milestones that add value to the process
Although the ruling was unfavorable, it is possible to highlight two key aspects:
- Recognition of broad standing in environmental litigation. Both the Court of Appeals and the Supreme Court recognized broad standing to file for protection, allowing individuals and foundations domiciled in Santiago to bring legal action regarding environmental damage in Tocopilla, a city located more than 1,000 km away. This sets a valuable precedent for access to environmental justice in Chile.
Regulations for the retirement of thermoelectric plants. During the trial, the National Electricity Commission (CEN) issued a directive entitled “Internal Procedure: Retirement Program for Conventional Thermal Generating Units of the National Electric System,” which establishes new rules for the retirement of thermoelectric plants. The document requires companies to submit a retirement program, regulates the extraordinary purchase of fuel, and outlines exceptions to the energy dispatch order outside of the economic order.
On this last point, the instruction establishes two requirements to authorize an exceptional burning of stock : having a document issued by the competent environmental authority that certifies that the stock cannot be moved, and a certification that the remaining stock originated for justified reasons.
While the legality of these exceptions remains questionable, it is noteworthy that an instrument has been enacted to regulate these situations—the first of its kind. The fact that it was published right at the time of the trial demonstrates that the extraordinary burning in Tocopilla was not carried out in accordance with regulations and also acknowledges the need for greater control and transparency in these processes.
Final reflections
The case of Tocopilla highlights the complexities of the energy transition process we are experiencing. While we celebrate the closure of coal-fired power plants, we cannot allow this to justify environmentally regressive actions.
The transition must be framed within principles of justice, inclusion, and respect for human and environmental rights. Only in this way can we seize this opportunity for change, without repeating the mistakes of the past, to put an end to fossil fuels that disrupt the planet's natural balance.
For now, it is necessary to continue working to achieve guarantees that prevent unfair situations under the guise of the energy transition, such as the one suffered by those who live in Tocopilla.
*Juan Zapata Hassi is a lawyer and fellow at the Inter-American Association for Environmental Defense (AIDA), and Florencia Ortúzar Greene is the director of AIDA's Climate Program.