Michelle Bachelet
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Chile’s President Michelle Bachelet senate will shortly sign into law a tax refund for power generators that use diesel.

The law would come into affect on April 1 and last through March 2011. Any power generator that currently pays VAT could take advantage of the new refunds. Off-grid power providers will also be eligible for the refund, according to the statement from , energy commission CNE.

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Current legislation in Chile allows taxes charged for diesel to be recovered if it is not used for vehicular transportation. But various aspects of the current have made it difficult for some diesel generators to recover the taxes.

The new law would provide a supplementary measure to recover taxes more quickly and is expected to impact 800MW of new generation projects that have already been approved by environmental regulators.

Diesel turbine units totaling 150MW capacity were installed in 2007.

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