Environmental Technologies Industries

Environmental Technologies Industries

Market Plans

Chile Environmental Export Market Plan

VI-Environmental Services

As Chile establishes its environmental regulatory structure and begins to address priority environmental problems, the demand for environmental consulting services will continue to grow. More than 130 companies now offer environmental services and sell environmental equipment in Chile. To be profitable, local firms often pair consulting services with equipment sales. For certain types of services, firms may face stiff competition from local universities, which can often win contracts based on cost because they are exempt from the 18 percent value-added tax, have their own laboratories, and incorporate salaries into their institution’s annual budget.

Selected Consulting Firms in Chile

U.S. Consulting Firms with Offices in Chile

Bechtel
Dames & Moore
Dastel Environmental Engineering
Electrowatt Engineering Chile
ERM Chile
Fluor Daniel
Knight Piesold Engineers
SAIC
SRK
TESAM (partners with Radian International LLC)

International Firms with Offices in Chile

ABI Akustik Berliner (German)
Bureau Veritas Chile (French)
CICA (Canadian)
PROPERL Chile (Colombian)
Rhone-Poulenc (French)
SENES Chile (Canadian)
SGS Chile (Swiss)
SNC-LAVALIN (Canadian)

Various international consulting companies have successfully established themselves in Chile and offer services that range from environmental impact assessment and industrial waste treatment and monitoring to environmental audits. Dames & Moore has been one of the most competitive firms in providing EIAs. TESAM, partners with Radian International, specializes in the field of environmental management. SAIC, newly established in Chile, specializes in training courses for professionals in environmental health services and represents public and private chemical laboratories. Successful foreign firms such as Bureau Veritas (French), which specializes in certification, and SGS (Swiss) have been operating in Chile for many years. These internationally recognized firms offer a wide range of services. The box titled "Selected Consulting Firms in Chile" provides a list of many foreign consulting firms with offices in Chile.

Environmental Impact Assessments

The 1994 Environmental Framework Law requires that all new projects and activities be evaluated to determine environmental impacts. This requirement went into full effect in April 1997, and now all new projects must submit either an environmental impact declaration (EID) or an environmental impact study (EIS), depending on the magnitude of potential environmental impact.
This aspect of the law has created a growing market for environmental impact assessment consulting services in Chile. The EIA market, which was only $7.4 million in 1996, is expected to triple in 1998. The U.S. company Dames & Moore has been very active in this area; during the past seven years, they have prepared 39 EIAs with a total value of over $6 million. Active Chilean environmental groups have blocked many large-scale projects, thus increasing the demand for quality EIA reports and social impact analyses. Due to shortages of qualified staff, CONAMA and the COREMAs often contract with private-sector consultants to provide technical reviews of the EISs they receive. CONAMA maintains a list of consultants that provide these services.

Approval Process for Environmental Impact Assessments

CONAMA and the COREMAs are responsible for implementing the environmental impact assessment process. To begin the approval process, either an environmental impact declaration (EID) or an environmental impact study (EIS) must be submitted to the director of the appropriate COREMA. If the submission meets the basic requirements of the Environmental Impact Evaluation Regulation, the director then initiates the review process. By law, COREMA has 60 days to review the EID and 120 to review the EIS, and must either approve, reject, or conditionally approve the project. The project must also be submitted for public review. An abstract of the project is published in the Diario Oficial, and the public has 60 days to submit written comments to COREMA. Finally, COREMA must also send copies of the document to the various state and local agencies affected by the project; these agencies are required to submit an evaluation to COREMA. In these reports, they may ask for clarifications and further information or suggest additional measures that must be undertaken by the project for it to be approved.
Once COREMA has received input from the other agencies and the public and has conducted its own evaluation, a technical report of the study or declaration must be prepared. This report includes comments submitted by the respective public agencies; a summary of observations made by the community in relation to the project’s environmental impacts and mitigation, reparation, and compensation measures; the necessary environmental permits; and a recommendation to accept or reject the project.

ISO 14000 and Environmental Management Systems

Chilean businesses are increasingly factoring environmental considerations into their overall business strategy. This is prompted in large part by the requirement that companies that export products adopt international standards such as ISO 14000, EMAS, and BS 7750. To meet environmental goals, more companies are establishing environmental management systems (EMS) and seeking certification. ISO 14000 is a series of standards being developed by the International Standardization Organization (ISO) to provide business with a structure for managing environmental impacts. ISO 14001, the Environmental Management System Specification, is a generic management system based on industry’s experience with EMS. It is the only standard in the series intended to be used for third-party certification. ISO 14001 was approved by the international body in 1996. The first two national companies in Chile to receive certification in ISO 14001 are Forestal e Industrial Santa Fe, S.A., and Forestal y Agrícola Monte Aguila, S.A. Both Licancel, S.A. (a cellulose producer), and Cemento Melón, S.A. (a cement plant), anticipate receiving ISO 14001 certification in early 1998.
The Chilean mining sector has been in the forefront of efforts to implement EMS. For example, the publicly owned mining company CODELCO is currently implementing an EMS and hopes to receive ISO 14001 certification in 1998. Between 1989 and 1996, CODELCO invested more than $635 million in projects to improve its environmental performance.
Consultants have played an important role not only in helping these companies prepare and receive certification but also in conducting environmental audits to help the firms improve productivity and environmental performance. Although Chile’s National Standardization Institute has not yet established an accreditation process for ISO 14000 or a registry of certified consultants, many of the country’s international consulting firms offer ISO 14000 certification. Training courses and seminars on ISO 14000 have also been very popular in Chile during the past two years.

Laboratory and Monitoring Services

The Superintendency of Sanitary Services (SSS) maintains a registry of laboratories certified to conduct analyses. Most of the more than 50 laboratories certified in 1997 specialize in integrated water monitoring and analysis services. Just a few are certified to determine the toxicity of industrial wastes and sludge. Laboratories also offer monitoring services for industrial emissions, specifically particulate matter (PM10).
All industries that have air emissions and wastewater discharges are required by law to monitor their emissions periodically. However, with the new air and water regulations coming into effect, there will be a shortage of laboratories with adequate technical capacity to monitor and analyze industrial emissions. The University of Concepción maintains one of the few labs in Chile that use whole effluent toxicity (WET) methods. The U.S. Environmental Protection Agency is working with the Chilean Government to develop a standardized national WET testing program. A Canadian firm, Analytical Services Laboratory, has set up a $1 million laboratory in Antofagasta targeting the multinational mining companies. For Chilean industries to comply with the new regulations, it will be necessary to increase the technical capabilities and standardize the processes of Chile’s laboratories.

Other Environmental Services

In addition to EIAs, environmental management systems, and certification services, the demand for environmental consulting will increase in such areas as the following:

Pollution Prevention/Cleaner Production Audits. While traditional environmental pollution control is still the predominate approach, pollution prevention measures are gaining ground. Under the U.S. Agency for International Development’s (USAID’s) Environmental Pollution Prevention Project (EP3), audits were conducted in a number of companies to demonstrate the economic and environmental benefits of pollution prevention (see box titled "Fostering Pollution Prevention in Chile"). The Ministry of Economy has been working on a Cleaner Production Policy that provides incentives for the adoption of pollution prevention. As more companies become familiar with the benefits of this approach, demand for these services will increase. Such services must have a technical focus and provide concrete, practical opportunities.
Industrial Wastewater Characterization Studies. Demand for consulting services is centered on the evaluation and treatment of industrial wastes. The main driver for these services is the pending publication of new regulations for discharge of industrial liquid wastes into sewerage systems and waterways. Some industries have contracted with environmental consulting services to install wastewater treatment equipment.
Industrial Hazardous Waste. Pending finalization and publication, new regulations will create the need for consulting services for hazardous waste management. Companies will need treatment systems, proper storage containers, and final secure disposal for hazardous and toxic wastes.
Environmental Liability Insurance. This is a new area with growing potential. Although environmental insurance is required by the 1994 Environmental Framework Law and by the Environmental Impact Evaluation Regulation for certain large-scale projects, the act of taking out insurance is still very new. In mid-1997, the company Sacyr, which has a concession from the Ministry of Public Works for the Pan-American Highway from Los Vilos to La Serena in Region IV, was the first to purchase this type of insurance. The insurance was issued by Le Mans insurance company.

Fostering Pollution Prevention in Chile

Between 1993 and 1996, USAID’s Environmental Pollution Prevention Project (EP3) worked in Chile to demonstrate the benefits of pollution prevention. Diagnostic assessments were carried out in 25 industrial facilities including plants in such sectors as electroplating, tanning, textiles, food processing, mining, and chemicals to identify measures that would reduce pollution and help the plants save money. Sample findings included the following:

Reducing water usage by 25 percent in a textile plant resulted in total annual savings of $23,000.
Eliminating the use of mercury and other heavy metals in a paint manufacturing facility resulted in total annual savings of $76,000.
Reducing chromium in wastewater in a tannery resulted in total annual savings of $55,000.

These demonstration projects illustrate to the industrial sector that measures to reduce environmental impacts can also improve the company’s bottom line. Based on this work, the Chilean Government has incorporated an emphasis on pollution prevention in its regulatory approach.

Market Summary and Best Prospects

Chile’s market for environmental services is estimated at $55 million, nearly half of which is for EIAs. Although this market is not one of the country’s largest, demand for environmental services is expected to continue growing rapidly. The need for EIAs will continue to dominate the market, but as regulations for air, water, and hazardous waste are promulgated and more strictly enforced, industries will also require consulting services to help them meet these new standards. ISO 14000 and other certification programs will also continue to be popular for Chilean companies, particularly those involved in the export market. Companies providing consulting services should be fully versed in EMS practices and certification requirements. Several U.S. companies are well-established in the Chilean market, but they will continue to face competition from European and Canadian firms.

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