Abstract

CASTRO, Rodrigo  and  SANHUEZA, Ricardo. Beneficios de la competencia en el transporte de gas natural: la experiencia de Chile. rlde [online]. 2004, n.3, pp.9-48. ISSN 2074-4706.

Different institutional alternatives were evaluated to introduce natural gas into Chile, which had diverse objectives: to assure a sufficient, environmentally consistent energy supply for an open economy with a high level of competition; to promote the strong participation of the prívate sector as the main engine of development; to create long-term conditions to maintain economic growth; to introduce conditions that permitted the development of competitive, clean markets; to set and maintain precise, stable rules; and to promote free prices. The foregoing has been achieved despite the fact the authorities at the time sought different ways to intervene, either through the participation of the state-owned company ENAP as a competitor of the prívate consortia, or by proposing a bill in 1994 for the sector that involved significant state intervention and regulation thereof. The existence of an innovative legal framework (Law 18,856), and the fact that prívate parties were willing to invest under that framework, made it possible to avoid State participation in the sector and prevented some inappropriate regulatory changes. An institutional strategy was created for operation of the industry that left the government out of the discussion and kept the industry free of political pressure, where competition among prívate parties was privileged and direct regulation by the State was minimized. That strategy is based on the idea that an appropriate institutional framework makes it possible to have a competitive sector, avoiding the disturbance of the political process behind the design of the regulatory framework where there would be strong State intervention. The strategy followed by Chile in the gas industry shows it is possible to limit the State's action for the efficient functioning of natural gas transportation operations. Although the State cannot be removed from the obligation to establish minimum rules for operation of the market, the Chilean experience clearly shows the prívate sector is capable of dealing by itself with the institutional demands that arise as a result of the economic characteristics of the sector. The Chilean experience is still too recent to permit an in-depth evaluation of the strategy of privileging prívate action in the creation of an institutional framework for the sector. Nevertheless, the competition generated in the public offering processes, which ended up giving economic viability to the projects that succeeded in achieving long-term contracts in the best conditions for the customers, is an indicator that, in current conditions, it has been possible to make the development of a competitive transportation sector compatible with minimization of the regulatory apparatus of the State. It remains to be seen how the sector will evolve in the future, and whether the increase in market size will generate the necessary conditions for new local operators to enter, thereby keeping public action at bay on the subject of price regulation.

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