Case Study Analysis and Solutions

Case ID: 709060

Abstract:
Case Solution & Analysis for Colbun--Powering Chile by Forest Reinhardt, Gustavo A. Herrero, Sanjay Patnaik
This case is about Colbun, Chile's second largest electricity generator, which is facing significant uncertainty regarding the cost and availability of alternative energy sources. Problems with the contracted supply of natural gas and the volatility of oil prices, coupled with regulatory changes made by the government, force Colbun to revise its business strategy and its sourcing mix. New legislation will replace historically regulated electricity prices for certain customers with free market prices and therefore change the conditions under which the company must operate. The case also deals with the pros and cons of various energy sources in view of their perceived environmental impact. As the company's CEO, Bernardo Larrain Matte has to take all these different considerations into account when planning Colbun's future, especially in the light of new opportunities and challenges posed by global climate change. The case analyzes the Chilean electricity sector and the operations of Colbun to illustrate the complexities associated with conducting business under the influence of global energy markets, government regulations, and environmental activism.

Keywords:
Business & government relations, Climate change, Economic development, Energy, Global business, Government, Laws & regulations, Long term planning, Organizational change, Politics, Small & medium-sized enterprises, Strategic planning, Strategy, Colbun Powering Chile Case Solution

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