Mass power outage in Chile: private companies under scrutiny from authorities

An unprecedented power outage affected 95% of the Chilean population, paralysing the country for several hours. The government has blamed the network management companies and announced a thorough investigation.

Share:

Chile experienced an unprecedented power outage on February 25, 2025, which paralysed nearly 95% of its 20 million inhabitants. The incident began at 3:16 PM local time (6:16 PM GMT) during the peak of the summer season, with temperatures exceeding 30°C. The situation forced thousands of people to walk home, disrupting traffic and prompting authorities to declare a state of emergency. Santiago’s metro, which carries around 2.3 million passengers daily, was evacuated, and other forms of transport quickly became overcrowded.

The Chilean government lifted the curfew imposed the day before and swiftly ordered an investigation to determine the causes of the failure. According to Minister of Energy, Diego Pardow, the private companies responsible for managing the network failed to adhere to security protocols and existing standards. “We will seek those responsible and impose severe penalties,” he stated. Authorities emphasised that the outage was caused by a technical problem involving a failure in electricity transmission between two circuits, triggered by a malfunction in the control system of a power plant in the north of the country.

Impact on the economy and industry

The outage had significant consequences for the Chilean economy. The state-owned copper company, Codelco, announced that its operations had been temporarily affected, although the precise impact on production is still being evaluated. Copper, which accounts for approximately 10 to 15% of the country’s GDP, is a key sector for the Chilean economy. The outage also disrupted the Viña del Mar International Festival, one of Latin America’s most important cultural events, with the third night of the festival being postponed.

Authorities have not yet estimated the total losses, but the situation has highlighted vulnerabilities in Chile’s power grid, despite its reputation as one of the most reliable in the region. Many households and businesses, including those in strategic sectors, suffered from the prolonged power cut, leading to significant economic disruptions.

Political reactions and crisis management

President Gabriel Boric reacted strongly, calling the outage “scandalous” and pointing the finger at the responsible companies. Chilean authorities announced that the investigation could take several weeks before clear responsibilities are established. This type of crisis fuels political tensions, especially as the country prides itself on having one of the most efficient grids in South America. Public and political reactions suggest that a revision of procedures and improved monitoring of infrastructure is expected in the near future.

Nearly USD92bn will be invested by major American and international groups in new data centres and energy infrastructure, responding to the surge in electricity demand linked to the rise of artificial intelligence.
Nouakchott has endured lengthy power interruptions for several weeks, highlighting the financial and technical limits of the Mauritanian Electricity Company as Mauritania aims to widen access and green its mix by 2030.
Between 2015 and 2024, four multilateral climate funds committed nearly eight bn USD to clean energy, attracting private capital through concessional terms while Africa and Asia absorbed more than half of the volume.
The Global Energy Policies Hub shows that strategic reserves, gas obligations, cybersecurity and critical-mineral policies are expanding rapidly, lifting oil coverage to 98 % of world imports.
According to a report by Ember, the Chinese government’s appliance trade-in campaign could double residential air-conditioner efficiency gains in 2025 and trim up to USD943mn from household electricity spending this year.
Washington is examining sectoral taxes on polysilicon and drones, two supply chains dominated by China, after triggering Section 232 to measure industrial dependency risks.
The 2025-2034 development plan presented by Terna includes strengthening Sicily’s grid, new interconnections, and major projects to support the region’s growing renewable energy capacity.
Terna and NPC Ukrenergo have concluded a three-year partnership in Rome aimed at strengthening the integration of the Ukrainian grid into the pan-European system, with an in-depth exchange of technological and regulatory expertise.
GE Vernova has secured a major contract to modernise the Kühmoos substation in Germany, enhancing grid reliability and integration capacity for power flows between Germany, France and Switzerland.
The National Energy System Operator forecasts electricity demand to rise to 785 TWh by 2050, underlining the need to modernise grids and integrate more clean energy to support the UK’s energy transition.
Terna has signed a guarantee agreement with SACE and the European Investment Bank to finance the Adriatic Link project, totalling approximately €1bn ($1.08bn) and validated as a major transaction under Italian regulations.
India unveils a series of reforms on oil and gas contracts, introducing a fiscal stability clause to enhance the sector’s attractiveness for foreign companies and boost its growth ambitions in upstream energy.
The European Commission is launching a special fund of EUR2.3bn ($2.5bn) to boost Ukraine’s reconstruction and attract private capital to the energy and infrastructure sectors.
Asia dominated global new renewable energy capacity in 2024 with 71% of installations, while Africa recorded limited growth of only 7.2%, according to the latest annual report from IRENA.
US President Donald Trump's One Big Beautiful Bill Act dramatically changes energy investment rules, imposing restrictions on renewables while favouring hydrocarbons, according to a recent report by consultancy firm Wood Mackenzie.
On July 8, 2025, the Senate validated the Gremillet bill, aimed at structuring France's energy transition with clear objectives for nuclear power, renewable energies, and energy renovation.
Brazil, Mexico, Argentina, Colombia, Chile, and Peru significantly increase renewable electricity production, reaching nearly 70% of the regional electricity mix, according to a recent Wood Mackenzie study on Latin America's energy sector.
The Canadian government announces an investment of more than $40mn to fund 13 energy projects led by Indigenous communities across the country, aiming to improve energy efficiency and increase local renewable energy use.
The German Ministry of Economy plans to significantly expand aid aimed at reducing industrial electricity costs, increasing eligible companies from 350 to 2,200, at an estimated cost of €4bn ($4.7bn).
A major electricity blackout paralyzed large parts of the Czech Republic, interrupting transport and essential networks, raising immediate economic concerns, and highlighting the vulnerability of energy infrastructures to unforeseen technical incidents.