SANTIAGO, Oct 20 (Reuters) - Reservoir levels and energy firms in Chile are expected to benefit from late rains in the southern hemisphere spring caused by the El Niño weather phenomenon, according to analysts.
Chile is usually a net beneficiary of El Niño, a warming of sea-surface temperatures in the Pacific that can lead to hot, dry weather in Asia and rains in South America.
Although heavy rains could potentially cause flooding, for now they are bringing relief after an eight-year drought in the Andean country, benefiting farmers, ski resort operators and energy companies.
Reservoir levels are at their highest in at least three years, while snow-melt is likely to increase as precipitation in central Chile has continued well into October, said Pilar Montaner, an analyst at Bice Inversiones.
“Seeing that it is still raining, obviously we think forecasts can increase, there will be a boost to hydroelectricity generation in the coming months, and that will favor above all Endesa and Colbun,” said Montaner.
Endesa Chile is controlled indirectly by Italy’s Enel , while Colbun is ran by the wealthy Chilean Matte family.
Normally, winter rains cease in central Chile by early to mid October, but current weather forecasts suggest El Niño rains will likely continue until the end of the year.
That should bring down costs for energy suppliers in 2016, said EuroAmerica energy analyst Alfredo Parra. Generators have been forced to increasingly depend on expensive diesel-run plants in the face of prolonged dry spells. (Reporting by Felipe Iturrieta, Writing by Rosalba O‘Brien)