Ralco

The Biobio River is the second longest in the country, extending 380 kilometers long. Emerging from the heights of the Andes mountains, this river flows through the diverse Chilean landscape, including valleys and volcanoes. This riverbank is home of Pehuenche and Mapuche indigenous communities, as well as other non-native urban and rural settlements. The Biobío provides essential water for human consumption, irrigation, conservation of biodiversity, and the overall survival of the human settlements in this riverbank. In addition, this water is a substantial contributor to the generation of energy in Chile.

The commune of Alto Biobío has a total population of 5,923 (2017 National Census), and its territory is the ancestral home of the Pehuenche culture. In its native tongue, Chedungun, Pehuenche translates to “the people of Pehuén”, alluding to the conifer^{^[1]} that fed the ancestral communities of the region with its fruit, the piñon. The Pehuenche settlements currently extend from Trapa Trapa (commune of Alto Biobío) to the lcalma lagoon (commune of Lonquimay).

Hydraulic Power Plants in Biobío

The hydraulic power plants of Ralco (690 MW), Palmucho (32 MW) and Pangue (467 MW) are all property of Enel Generación Chile and were constructed by Endesa in the territory of Alto Biobío. The plants came into operation as of 1998 (Pangue), 2004 (Ralco), and 2007 (Palmucho).

Ralco is the most important hydraulic plant in Chile. To enable its construction, 3,461 hectares of land were flooded, of which 638 were owned by Pehuenche families. 81 families were resettled in the Ayin Mapu and El Barco aboriginal communities, where all housing and social services were provided, and a ten-year plan was established to work with all the families involved.

Although initially there were environmental and social commitments only with the communities of Ayin Mapu and El Barco, Enel currently participates in "Collaboration Roundtables" with 8 other Pehuenche communities (Pitril, El Avellano, Aukin Walmapu, Quepuca Ralco, Ralco Lepoy, El Barco, Guayali and Los Chaicanes). These collaboration roundtables were established after the signing of "Dialogue Agreements" which have renewed the interest of both communities and the company in working together, facilitating dialogue as a mechanism to move forward and resolve differences. The Collaboration Roundtable has allowed the parties to reach a consensus on the initiatives to co-execute.

From the communities’ perspective, productive entrepreneurship, acquisition of new skills and competencies, incorporation of added value, identification and recognition of their tangible and intangible cultural heritage, and the use of local resources are fundamental for the endogenous development of the territory. Meanwhile, for Enel, sustainability and active collaboration towards local development, guided by the United Nations' Sustainable Development Goals, is an integral pillar of its corporate strategy.

Once both parties' points were clear, a Long-Term Plan was drafted together with the communities, which has been in motion since 2019.

Re-establishing relationships with a human rights approach

Since 2016, Enel has carried out three Due Diligence processes with special attention to social, environmental and security issues. These processes have led to an Action Plan to proactively address any risks detected, which has allowed for a 75% reduction in 3 years. This Action Plan focuses on coordinating operation areas in order to generate awareness about the company's human rights policy, the risks detected, and to carry out community inductions for contractors. In addition, this Action Plan led to the completion of the Ralco Plan, which addresses historical issues and establish a permanent dialogue with all the communities in the territory.

Likewise, and as a way of guaranteeing compliance with local regulations, the Company's Human Rights policy, and international regulations applicable to Resettlement (Performance Standard No. 5 of the International Finance Corporation IFC), a study was carried out in 2020 with the purpose of evaluating the relocation of the Ralco Hydroelectric Plant both in its conception and implementation as of 1997, as well as the process of complementary agreements with the communities in order to identify possible gaps and generate a plan of complementary measures to address and close them definitively.

It should be noted that in 2001, during the construction of the Ralco reservoir, an old cemetery was flooded. This event received great public notoriety for its cultural significance and was named “Site 53”. A series of ceramic remains, and utensils were rescued in the reservoir's current location, and given to the Municipality of Alto Biobío for their conservation as defined by the state of Chile through the Council of National Monuments.

The construction phase of the Ralco power plant was opposed by the local communities and conflict remained for several years. In order to mitigate this conflict, relevant authorities determined different measures for the company.

Meanwhile, the Latin American Court of Human Rights ordered, under a claim, demanding the Chilean State to reject any new hydroelectric plants in the Alto Biobío sector and to constitute a specific administrative area in this territory; giving rise to the Alto Biobío commune.

In order to compensate the impact generated by Endesa, today Enel Chile, the competent authorities arranged the following measures:

Improvements to the cemetery of the Ralco Lepoy community (completed)
Support the existing school in Quepuca Ralco and construction of a community center (in progress)
Building a memorial site (in planning)
Identify and safeguard local heritage sites (completed)
Management and financing for the construction of a cemetery in Quepuca Ralco (in planning)

The Pehuenche families affected by the impacts did not authorize these measures, since they were not consulted by the State prior to their definition. In 2017, only after the signing of a specific agreement between the families and the company, the implementation of these measures was authorized.

Historical agreements with families and communities of Alto Biobío

On February 3, 2017, an agreement was signed between Enel Generación Chile and 23 families who had historically been claimants due to the impacts generated by the flooding of the Pehuenche cemetery in the Quepuca Ralco area in 2004. The agreement was signed jointly by the leaders representing the families and the witnesses of faith, the Archbishop of Concepción, the Provincial Governor of Alto Biobío and the Mayor of the Municipality of Alto Biobío.

Then on June 28, 2017, another agreement was signed, this time with the communities of El Avellano and Quepuca Ralco, sealing the commitment towards development with those who historically inhabited the ancestral community of Quepuca Ralco.

These agreements represent an important advance in the company's relationship with the communities in the most affected area and opens the doors to a new cycle of relationships through a perspective of collaboration between the company and the communities.

Currently, the company has dialogue and collaboration agreements in place with 9 communities in the area, and actions have begun to be implemented. These specifically aim at the socio-economic development of families, through the implementation of innovative projects that promote the principle of conservation of natural resources and the Pehuenche culture. In summary, a proposal for sustainable development.

Economic development: some examples

The training and entrepreneurship promotion program has strengthened 96 individual enterprises, and three new community enterprises have been promoted.

Program for the diversification of hazelnut products in Alto Bíobío

Within the framework of a Pehuenche reconciliation and with the El Avellano community as the main protagonist, the project of Diversification of Products Developed from the Chilean Hazelnut was initiated. Enel Generación Chile promoted the project in partnership with the University of Concepción, the El Avellano community, the Municipality of Alto Biobío, the Fund for Agricultural Innovation (FIA), and the Pehuén Foundation. This was done to promote the development of products derived from the Chilean hazelnut, thus transforming an activity of ancestral nature to a micro-business level.

During 2017, the Company contributed to the acquisition of machinery to process hazelnuts and produce by-products such as coffee, flour, and roasted hazelnuts, among others, in order to add value to its offer. This allowed the Company to increase the commercial value of its products from average bulk prices of around $300 pesos per kilo to approximately $2,300 pesos per kilo. The same year, this project won a competition from the FIA, which allowed the entrepreneurs to build a processing room and orientation for the development of a business plan. In 2018, the Kotun Ñebun Indigenous Cooperative was created to manage the community project of processing and elaboration of products derived from the Chilean hazelnut, which has 17 members and employs 5 people.

To date, a sanitaryresolution has been obtained and a trademark has been registered for its products, which is called Inchin Pewenche. The level of production has tripled from 1,000 kilos to more than 3,000, 60% of which is destined for the production of semi-roasted hazelnuts and the remaining 40% for other sub-products, which are sold in the local market and in the city of Los Angeles.

Tourism in El Barco

In the Pehuenche community of El Barco, an investment is underway to improve the infrastructure of the "Camping Turistico Laguna el Barco”, managed by the same community. Each season more than 6,000 tourists arrive in the area, proving this initiative’s great potential. The collaboration between Enel and the Community has been mainly focused on improving the sanitary situation, installing new bathrooms and drains for the treatment of sewage. The improvement of the water system that supplies the campsite is also one of the initiatives being considered to improve its conditions.

During 2019, the Company supported community entrepreneurs within the framework of the Agreement of Collaboration and Dialogue, in order to enhance the tourism services they can offer to visitors.

All these activities in El Barco have the purpose of generating new income destined to finance some of the agricultural activities that the community carries out: preparation of grounds, purchase of fertilizers and acquisition of seeds of cereals and forage. These contribute to sustain the minor and major cattle of the community and to promote the economy of the families that are dedicated to the tourist activity.

Currently Camping El Barco employs 9 people and has allowed the community to achieve a higher level of autonomy in the exercise of another primary activity for income generation besides agriculture. With the resources obtained from tourism, in addition to the investment generated in the campsite itself, the community acquires and maintains machinery that serves the families for the sowing, harvesting and maintenance of agricultural soils.

In El Barco a true system of virtuous economy has been effectively generated from which the whole community benefits.

Potatoes in Los Chaicanes sector Lonquimay

The Company is currently involved in a project in Los Chaicanes with the purpose of establishing potato cultivation in the area. The initiative, which in its beginnings had the purpose of commercializing the tuber for fresh consumption and in the zone, derived to the production of seed potato and to the recognition of the project by the Agricultural and Cattle Service (SAG) as one of the 17 authorized seedbeds in La Araucanía region to sell certified potato seed in the 32 communes of the region.

In 2019, a processing room was opened in the same community, financed by Enel, in a collaborative effort with the community and the SERCOTEC Technical Cooperation Service.

This enabled the habilitation of the first intercultural processing room with Sanitary Resolution and to the We Kimun Agricultural Cooperative that brings together 20 potato producers. At harvest time, 5 people are hired for seasonal tasks and currently 6 women are working in the processing of both potatoes and other fruit products that occur naturally in these areas, and serve as inputs for the manufacture and sale of jams, honey and others.

During the COVID-19 pandemic, the Lonquimay commune has taken strict measures to restrict the entry of people and vehicles into the territory as a preventive measure. In this context, the farmers of the We Kimun Cooperative have become relevant actors to guarantee the supply of food products in the commune, among which the sale of 15,000 kilos of potatoes to the local municipality stands out. This fact highlights the fundamental role of local producers for the resilience of local communities.

Access to education

Within the educational framework, the company's commitment is to implement a culturally relevant school with a participatory process that ensures the fulfillment of space and didactic model relevant to the Pehuenche worldview. The design reflects these principles and has already been socialized with the Municipality of Alto Biobío and the user communities. Meanwhile, Enel Generación financed the installation of a modular school, a project that was carried out in 2019, jointly with the Alto Biobío Municipality.

In terms of direct collaboration with families and students in the area, Enel provides scholarships to finance career fees, stays of young people in the cities where their educational centers are located, and other study materials, thus facilitating that each year more than 100 students can better continue with their school and higher education.

The above is channeled through the Long-Term Program for resettled families; through an agreement with the Municipality of Alto Biobío; and through the Pehuén Foundation.

Regarding the program of accompaniment to resettled families, since its inception in 2010 to date, 177 kids and young adults, 85 of whom are women, have received scholarships for secondary education with a graduation rate of about 82%. As for scholarships for higher education, these have benefited 72 young adults, of which 37 are women, with a graduation rate of 73%.

Click on the link to learn more about the initiatives in the territory associated with the plants in the Biobío Basin and in our Sustainability Report.

Bocamina

Coronel: The Roadmap Towards The Sustainability of The Resettlement Process

Background

The Bocamina I and II Thermal Power Plant has two thermal units located in the Lo Rojas sector, Coronel 's commune, Biobío Region. The first unit had been in operation since 1970 and was owned by the State of Chile. The second unit was approved through an Environmental Impact Statement (DIA) in 2006. During Endesa Chile 's management, in 2007, the construction of a second unit, Bocamina II began. The construction was carried out in a context of high urbanization in the northeast sector of Coronel inhabited by about 1,300 families.

The largest resettlement derived from industrial impact in the history of Chile.

The construction phase of the second unit generated impacts on homes around the construction site, causing a major conflict with the community. Said conflict was handled in 2008, through a plan to relocate approximately 400 families to different parts of the commune. This stage of the relocation process was developed based on bilateral agreements with each family without the application of national criteria and principles regarding resettlement and human rights.

After the planning stage for the resettlement of the families, the Bocamina operation caused conflict with the fishing community of Coronel due to issues associated with environmental impacts on the marine ecosystem as a result of the industrial processes of the plant. In December 2013, after an appeal for protection filed by fishermen and seaweed recollecter organizations in the area, the Court of Appeals ordered the shutdown of the plant. The following year, the Company was sanctioned by the environmental authority.

In 2014, the joint work of the company, Endesa Chile at that time, with other actors such as the SEREMIS (regional ministerial secretariat) of housing and urbanism, energy and environment, the union of neighborhood councils, the Municipality of Coronel and 20 fishermen unions, resulted in a framework agreement with three main work streams. Among them, the extension of the resettlement to another 900 families in the area of the Bocamina II plant, through a public- private resettlement agreement between families, SERVIU and Endesa.

The Benefits and Gaps of Resettlement

This resettlement implied a series of benefits such as acquiring a regularized house with great urban conditions such as access to drinking water, sewage and a stable energy supply system, which, from the point of view of material/physical benefit, improved the housing situation of an important part of resettled families. However, it also disturbed the previous social structure, made up of families that lived and collaborated as a community, which were now distributed in different points of the city, distancing them from their source of work. Most of them were fishermen who lived close to the sea. The lack of awareness of the importance of community during the resettlement process generated numerous difficulties and gaps in adaptation due to the impacts on the human and socio-economic environment. Additionally, the absence of a plan for the restitution of livelihoods made it difficult for families to adapt in the new neighborhoods, bringing this process closer to the definition of "eradication".

From 2017 onwards, when Enel took over the sustainability management of Endesa Chile, a revision of the "eradication" process was carried out with the purpose of transforming it into a process of resettlement in accordance and auditable to international standards.

Part of Enel's management at Coronel was to reflect on the fact that the "eradication" plan had a number of gaps to be filled, and therefore, there was an unfinished process. One of the deepest gaps was that this plan contained dissimilar and partial agreements between users, both from the private and public-private agreement. It was evident that the criteria of equity, transparency, human rights and internationally recognized standards for resettlement were insufficient.

This process involved more than 1,370 families, most of which were considered by the Ministry of Social Development to be socially vulnerable. The number of people involved makes it one of the largest resettlements carried out by an industry in Chile.

Review of the process and alignment to international standards and human rights approach

The process of reviewing the “eradication” process and its transformation into a resettlement process with a retroactive character represents an unprecedented operation at the national level. The review considered the entire process executed, with a direct focus on human rights and with a focus on activating a remediation plan with international standards, using the International Finance Corporation's (IFC) Performance Standard No. 5 as an instrument for resettlement and the United Nations' Sustainable Development Goals.

In order to diagnose the gaps generated by resettlement, Enel began an international tender in 2017 aimed at companies composed of experts with the highest academic level and with extensive experience in family relocation processes. The consultant selected was Environmental Resources Management (ERM), based in Canada, a company with expertise in resettlements worldwide.

This diagnosis for the process that took place in Coronel ended in 2018, and was developed integrating an approach of the United Nations Guiding Principles for Business and Human Rights. It was the first project to recognize impacts that occurred 10 years ago and resolve them widely, following international performance standards which, in some cases, exceeds national regulations.

The analysis involved focus groups and interviews with over 900 families, resulting in a report of gaps affecting resettled families in human, cultural and social settings.

The "Livelihoods" Plan: The Unprecedented Journey to the Past, with Today's Social Tools

To solve these previously mentioned gaps in the resettlement of families, Enel focused on the procedures required by the IFC Performance Standard No. 5, dependent of the World Bank, with the purpose of building a new paradigm of expected behavior with the affected families in this process.

a) Clear rules and sufficiency of information

The diagnosis detected a series of partial and dissimilar resettlement agreements applied to the families resettled during 2008, in some cases agreements with excessive (non-market) and irregular amounts, in which political intervention was found, and in other cases with insufficient amounts for the purchase of a home.

Enel voluntarily corrected this asymmetry during 2019, through the agreement levelling methodology, which consisted of a detailed review of all existing resettlement agreements.

The study identified two agreements: the public-private agreement of 2014 and the private agreement, from 2008, both with reliable social cadasters, endorsed by competent authorities, the highest number of criteria and standards and, of course, they meet the standards of the Performance Standard No. 5 of the IFC (International Finance Corporation). These instruments would be the normative standard to level the economic terms of the agreements with resettled families to fair conditions.

The implementation of settlement equalization remedied the situation of more than 250 families who in the past had been arbitrarily excluded from plan benefits or compensated without clear rules of the process. Enel applied this management measure in a unique way following the Company's internal regulations and with a sense of equity for the families. Enel Generación Chile invested close to 2.5 billion chilean pesos in this measure during 2019.

b) Security of tenure: The diagnosis detected cases in which families were relocated to places along the coast, which impacted beneficiaries given the impossibility of proving wealth of these residences over time. Despite the fact that the users themselves chose these places, there was evidence of a violation of the security of tenure (ownership of the land) that the beneficiaries of a resettlement process must have.

Enel resolved this gap with a professional support team that collaborated with these users to obtain the regularization of these properties and homes.

c) Replacement of infrastructure of church organizations: The resettlement process of 2008 and 2014, respectively, only contemplated the relocation of families and their homes, excluding the church infrastructure of the evangelical creed in the area.

When Enel arrived in Coronel, they were recognized in a memorandum of understanding during 2017, prior to the diagnosis, in an unprecedented event in the industry, configured as a milestone of good faith and reconciliation with the evangelical churches of Coronel.

Currently these churches are being rebuilt in areas close to the resettlement neighborhoods and correspond to the communities of origin of Adonai Church, Jesus Christ is the Kirios, Christian Philadelphia of Jesus Christ, Jesus Christ Restoration Ministry The Colony, Connected to Christ, Divine Hope, Mission of the Church of the Lord, The Beautiful and Evangelical Wesleyan.

d) Re-building of educational infrastructure, the Rosa Medel School:

The Rosa Medel Aguilera School had a severe deterioration in enrollment, due to the displacement of families to other destination neighborhoods, because the building was outside the area destined for resettlement.

During 2017, prior to any diagnosis and following its Human Rights Policy, Enel closed an agreement with the Municipality of Coronel and the center for parents and guardians of that establishment, with the aim of collaborating with the rebuilding of this infrastructure.

This commitment was made in 2019, when the Municipality of Coronel provided the land where the work will be executed. Enel delivered a contribution of 2 million dollars, in addition to financing the soil mechanics and pre- feasibility studies, being the only company in the area interested in co-financing this project, which is in the midst of more than 15 industries in Coronel. The new school will be located in the La Peña sector.

e) Housing with construction deficiencies: A group of 240 families moved to the neighborhoods of Doña Isidora and Huertos Familiares, where they received housing with construction deficiencies and without a current construction company to which to make their claims. The houses were of a useful age, that is, they had not yet reached 10 years of deterioration (the period in which the post-sale guarantee for structural damage ends in Chile).

During 2017, Enel Generación closed an important agreement with the Junta de Vecinos de Huertos Familiares and later with Doña Isidora that involved:

Establish a technical table with engineers representing the interests of the community, Enel engineers and a third technical part that was identified in the CITEC- Centro de Investigación en Tecnologías de la Construcción, of the University of Bío-Bío.
Carry out a comprehensive technical study of each home of Huertos Familiares and Doña Isidora for an excellent repair. This research was carried out by CITEC from the University of Bío-Bío and agreed upon by the technical committee.
Housing change option for those families who voluntarily opt for a permanent change of home. For this measure, Enel considered a team of experts who prepared an appraisal study for resettlement purposes. This process involves recognizing the residences as if they were in perfect condition.
Study of social impacts and recognition of management measures.These measures recognized the expenses incurred by the families, considering that the deterioration of the houses was mainly structural. These management measures were paid to all families during 2017. An additional management measure was contemplated exclusively for those families that opted for repairs, given that they will have impacts resulting from the repair process in their homes. This began in 2019 with the detail engineering phase, the repair project and the obtaining of permits associated with the new process and a bidding process by Enel.
The repair process is voluntary and will begin on the ground in 2020 and end in 2023. To reassure families and restore trust, this process will be executed initially in pilot homes so that families know the repair process in each neighborhood.
Temporary relocation: To avoid the inconvenience of the families during the repair process and the associated costs, Enel has fully equipped fifteen houses within the neighborhoods, which will be used as residences, to accommodate the families.
Battery of improvements, with the purpose that the families that will give their houses to repair, opt to a better quality of life. Enel committed a series of additional ones not identified by CITEC but that seek to improve the quality of life of the families. For example, the change of roof covering, installation of a humidity barrier, among other actions.

f) Loss of materiality, the "TOP" houses: The "eradication" process implemented in 2010 did not consider those families who own houses with a verifiable constructive superiority. The diagnosis found that the public-private resettlement plan was only aimed at those families of high vulnerability, with houses built with light materiality. Therefore, during 2017, Enel applied a specific methodology for these users, established a mechanism that included an appraisal study with criteria of social relevance, which recognized in an auditable manner this loss of materiality of the houses called "Casas Top".

After the analysis of each case, an agreement was generated with each family, allowing them to be resettled in conditions appropriate to their home, with criteria of equity and transparency, in accordance with the IFC resettlement standard.

g) Consolidation of information, an updated baseline: During 2018, Enel systematized the entire process executed. With this instrument, it learned about the reality and management measures of each of the resettled families. This implied that those beneficiaries who had a transactional logic and who attempted aggressive actions to obtain benefits again were dismissed in their claims, being considered as "opportunists of the process". This has allowed Enel to have a very close link with those families who, in an auditable and measurable way, were indeed impacted. This procedure has allowed Enel to put principles of equity and impartiality to work in the face of these events.

During March 2020, there was an irregular tapping of one of the high voltage towers that evacuates the energy from Central Bocamina. This irregular takeover was carried out by people who had received onerous agreements in the past. For this reason, the company refused to meet with these families, since accessing these pressures would mean reopening gaps in a process that was in the process of being remedied.

h) Impacts on the economic environment, impacted rural enterprises: The revised resettlement process found that a group of "carretoneros" (a trade in which a horse and cart is used as transport for the sale and distribution of charcoal and firewood) was recognized in the process with accredited documents. However, the associated management measures were inconsistent with the losses of the families who were forced to sell their main source of income (the horse) since, in the destination areas, it is prohibited to use the homes for the care of productive animals. This controversy was resolved by Enel and the cartwrights, with a process of formulating projects aimed at reactivating their enterprises. Today, most of them carry out cargo transfers, materials, removals or distribute certified firewood.

i) Restitution of social infrastructures, the "My neighborhood, our neighborhood" plan: The resettlement process excluded the social infrastructures of the areas of origin as community and other headquarters. These were intended for the cohesion of families. For this reason, Enel, during 2017, initiated a plan focused on the replacement of community infrastructures and equipment. These projects are designed together with the community and are currently an opportunity for families to acquire skills and have a source of employment, in the construction phase of these initiatives.

This plan contemplates the construction of infrastructure in the neighborhoods where these buildings were not developed and considers seven infrastructures, of which a sports center of excellence is completed and three social centers, built with models of circular economy and with local labor opportunities marked by a strong gender focus. During 2021, the delivery of three more infrastructures will be completed.

These jobs involved a workforce of more than 200 people, 50% of whom were women working in construction, and jobs associated with the work such as cooking and monitoring.

j) Management measures for people with disabilities:

The livelihood plan contemplates universal access measures for all infrastructures that are delivered in the process of relocation of families. This measure is compensatory in case the family has already invested and accredited these adaptations in the houses that did not contemplate this measure in the past.

k) Management measures for pregnant people: Those women who were pregnant were excluded from the relocation process, mainly because the baby was not born at the time of the social cadaster. Enel facilitated and recognized all these families.

l) Local grievance mechanism with an international approach to resettlement: During 2018, Enel installed a local grievance mechanism in Coronel to resolve issues that required a technical-social approach that would provide formal responses to those users who could be affected in their quality of life or who required the provision of clear and concrete information. The system has handled more than 400 situations, positively remedying more than 70%. The rest have been rejected mainly because they are users who have already received the most advantageous agreements or because their complaints were not supported or creditable.

m) Installed capacities: All the gaps in resettlement have been addressed as a vision of opportunity to apply Enel's shared value creation (CSV) model, which is why the buildings, housing and programs promoted by the company encourage the use of local SMEs, the hiring of local labor and the training of people in building and social monitoring.

Immaterial Losses of Families, The Livelihood Restoration Plan:

This plan aims to be a bridge for the long-term economic development of families and is intended to improve their quality of life or livelihood, understood as the full range of means used by individuals, families and communities to earn a living.

In 2020-2021 period, the following social development programs will be carried out:

a) Program aimed at Older Adults, Children participating in the Resettlement Plan. Objective: To generate instances of social participation and recreation of the elderly, enhancing their social and cultural rights. Audiovisually documented conversations will be carried out to share and value the stories of their current populations, reinforcing their sense of belonging and revealing their life experience. It addresses human and social capital.

b) "Coronel Emprende" Competitive Fund, special line for entrepreneurs of resettled families. Objective: to promote local entrepreneurship, opening new opportunities for productive development that favor the social and economic development of the resettled families. Aimed at formal and informal undertakings by members of resettled families. Addresses economic capital.

The Fund has benefited more than 140 enterprises, 72 of which are led by women.

c) Scholarships for Higher Level Students "Beca Rosita Medel".

Objective: To contribute to the continuity and permanence of higher education for members of resettled families, who are studying at a higher level of university and technical education. Addresses human capital. 40 scholarships will be awarded annually to students who demonstrate academic excellence.

d) The Mural: Given the process of restoring livelihoods and the recovery of the social fabric with the resettled families, the first project in Chile of Enel's Open Power to Art plan begins, which consists of a mural of more than 3000 meters in length where the community captured historical passages of the commune. It is one of the largest murals in the country.

e) SMEs in Coronel: The company's change in strategy, inspired by international criteria to restore livelihoods in Coronel, involved strengthening the entire supply chain for the sustainability department. Catering services, parking lots, lodging, events, cleaning services, monitoring services, food services, began to be activated in the same commune of Coronel, avoiding going to other communes in the region with greater resources such as Concepción or San Pedro de la Paz.

f) A new alliance with artisanal fishing: Many of the families in the resettlement had as their head of household and support for the artisanal fishing families, so a large number of these people were relocated away from their trades. With the aim of generating a common alliance between artisanal fishermen and Enel, a new approach and lines of work were developed that were framed in the just transition, that is, collaborating in building an economic heritage for these groups, avoiding the welfare approach previously installed in the community. For this reason, a joint program was designed with 2,039 fishermen that integrates twenty social infrastructures for artisan fishing and a competitive fund of 600 million pesos a year for the reconversion of trades, or the strengthening of existing ones, this during the useful life of the plant.

g) CorCoronel Fund: In order to collaborate in the development of the commune of Coronel, Enel injects 180 million pesos annually into the CorCoronel (Municipal Corporation). To date, projects have been implemented in the areas of the environment, roads, and economic development. Currently, this amount has been a support to attend the health or social contingency measures for the COVID-19 pandemic.

h) Circular Economy: Coronel was one of the first communes to develop, together with Enel, circular economy SMEs. This is the case of the ENTREPALLETS SME, which is dedicated to extending the useful life of industrial pallet wood. This SME, made up of three women from Coronel, has facilitated the implementation of social centers, the sustainability office and other projects with eco- furniture design. These women traveled from Coronel to Italy to present this pioneering undertaking that brings together circularity and gender perspective.

Installed capacities in our people: Enel professionals develop expertise in the international standard of resettlement.

At the local level and applying the guidelines of the Sustainability Management, Enel deploys a work team in Coronel composed of professionals and technicians who, on a daily basis, attend to individuals and families in the community.

This territorial team absorbed capacities in the knowledge and application of the International Finance Corporation regulations. The ERM experts trained this working group in the theoretical framework, application of the standard and management measures in both the cases of resettled families and those pending resettlement.

Environmental improvements, the new Bocamina:

Enel also carried out a process of environmental excellence for Bocamina. A series of major environmental improvements were implemented through investments of more than $200 million dollars, which are fundamental to guarantee the sustainability of the project and the permanent respect for the human rights of individuals, communities and the environment.

The main environmental improvements of the plant are specified below:

Implementation of "Johnson" type filters for seawater suction and cooling in both units of the plant that almost completely reduce the entry of hydrobiological organisms into the plant's cooling system.
Two domes for the collection of coal, in both units of the plant. These geodesic metallic structures prevent pollution by coal dust and have made Bocamina the first power plant of its kind in the country and in Latin America to have this modern system.
Acoustic measurements in the whole plant.
Particulate matter (PM 2.5) monitoring in the online air quality network which is publicly accessible information.
Environmental excellence improvement plan for the "Millabú" ash dump that is being reforested, with a 75% progress.

All these improvements have made Bocamina one of the thermal plants in Latin America with the best performance and environmental standards.

Just Transition, Decarbonization Plan: The Final Closure of Both Units is Brought Forward.

On May 27, 2020, the board of Enel Generación Chile announced its decision to bring forward the closure of the two units of the Central Bocamina thermoelectric complex. In order to implement this measure, the company requested the Executive Secretary of the National Energy Commission (CNE) to authorize the final withdrawal, disconnection and cessation of operations of Bocamina I, no later than December 31, 2020 and of Bocamina II, on May 31, 2022.

The application was subsequently approved by the National Energy Commission.

This definition implied substantially advancing the closure dates committed by the company in the National Decarbonization Plan signed with the Ministry of Energy on June 4, 2019, which foresaw the closure of Unit I by the end of 2023 and, at the latest, in 2040 for Bocamina II. This decision confirmed the leadership of the Enel Group in Chile by accelerating its decarbonization process, reinforcing its commitment to face the effects of climate change, in addition to the investment plan that considers adding 2 GW of renewable energies to the energy matrix by 2022.

Even though the plant will cease operations in December 2022, all commitments and plans that Enel has established in Coronel will be maintained and executed as it has committed to families and communities.

Click on the link to learn more about the Company's initiatives in Coronel and in our Sustainability Report.

Pullinque

In 1958, the state-owned electric utility company Endesa began the construction of the Pullinque hydroelectric power plant on the northern bank of the Huanehue river, within the framework of the National Electrification Plan carried out by the State of Chile through its production development corporation CORFO. The 51 MW pass-through power plant utilizes the water of the Huanehue river, located in the Entre Ríos area of Panguipulli county, which flows into the Panguipulli lake. The hydraulic structures built in the 1960’s mainly consist of a water intake structure (bocatoma) at the Pullinque lake river mouth, which is channeled towards a turbine hall where energy is generated. The power plant was sold by Endesa to a third party and ultimately acquired by Enel Green Power in 2001.

The social environment of the Pullinque hydroelectric power plant is comprised of 350 Mapuche families distributed among 9 rural communities spanning across four territories: Tralcapulli, Llongahue, Curihue, and Tralahuapi.

From 2006 to 2016, the communities chose to work alongside the Company on local development initiatives, specifically in agricultural development, aimed at increasing crop yields for self-consumption. In some cases, these efforts surpassed family needs, allowing for distribution in fairs and markets, thus increasing their revenue potential. In addition, and for almost 15 years now, Enel funds a scholarship program to foster education continuity among the community’s students.

Starting in 2018, the communities founded the Kom Kiñepe Tain Newen corporation to broaden the areas of investment from agriculture and education to include infrastructure, housing and land improvement. The corporation represents the Llongahue, Tralcapulli, Curihue and Tralahuapi territories. Kom Kiñepe Tain Newen and the Company operate a task force to define local development programs.

Enel Green Power funds over 100 scholarships per year, distributed among students in high school, technical institutions, and universities, allowing these students to further develop their professional careers. In 2019, scholarships were extended to primary school, benefitting 60 students.

Local development plans also included investments in agricultural development, infrastructure, and land improvement. To this end, in 2019 the Company collaborated with 118 community members in improving the conditions of their productive and entrepreneurial initiatives.

These investments notwithstanding, some of the families living by the Huanehue river have expressed their disappointment regarding a section of the river that has not seen the flow of water in decades.

As stipulated in Company guidelines regarding relations within territories where it operates, Enel has actively participated in task forces dedicated to study and design of potential solutions to the aforementioned problem.

Specifically, regarding the section of the river without water since the 1960s, it was noted that any measure to restore the Huanehue river water levels must have completed evaluations for its technical, economic, and, most importantly, environmental feasibility, in order to mitigate or prevent possible environmental impacts to ecosystems existing in the area for more than 60 years. It was also noted that any infrastructure or activity carried out by community members further downstream, which could be affected by an increase in the river’s water flow, must be identified. The necessary studies, whose scope was brought forth at the task force meeting attended by the families and the Company, included participatory methodologies to define potential previous impacts, identify potential future impacts due to water flow, and update the environmental baseline.

Even though the studies were required to third party experts and underway, the works were not supported by families living along the river and were therefore suspended.

Enel has invested in the development of local communities within the operating zone of the Pullinque hydroelectric power plant through initiatives and projects that have been agreed upon by communities and that have been created by joint task forces dedicated to the construction of a common perspective, aimed towards finding consensual solutions with the communities. In the case of the Huanehue river, Enel has listened to the community and has made the necessary resources available to find plausible and satisfactory solutions to the territory’s needs, combining the power plant’s operational continuity, the community’s needs, and above all, their consent on all works that may be implemented.

In the case of the Huanehue river, all possible solutions, given the technical scale, dimension, and environmental requirements of replenishing the river’s flow, require evaluations and studies to minimize the impacts on anthropic and environmental ecosystems that have been developed in that section of the river without permanent water flow over the last 60 years.

Ongoing dialogue, transparency, and timely delivery of information among parties are instrumental in creating consensual, plausible, and sustainable solutions, which have been implemented in the more than 300 communities with which we work throughout the Chilean territory.

Click on the link to learn more about the initiatives in the territory associated with the plants in Pullinque and in our Sustainability Report.

Equitable relations with communities

In 2021, Enel together with UDP implemented an unprecedented program to award scholarships to social leaders from three territories where the company is present, in line with its vision of symmetrical dialogue with the communities.

Success Stories