As of August 2020 Chile had diverse sources of electric power: for the National Electric System, providing over 99% of the county's electric power, hydropower represented around 26.7% of its installed capacity, biomass 1.8%, wind power 8.8%, solar 12.1%, geothermal 0.2%, natural gas 18.9%, coal 20.3%, and petroleum-based capacity 11.3%. Prior to that time, faced with natural gas shortages, Chile began in 2007 to build its first liquefied natural gas terminal and re-gasification plant at Quintero near the capital city of Santiago to secure supply for its existing and upcoming gas-fired thermal plants. In addition, it had engaged in the construction of several new hydropower and coal-fired thermal plants. But by July 2020 91% of the new capacity under construction was of renewable power, 46.8% of the total solar and 25.6% wind, with most of the remainder hydro.

Chile's electricity sector changes were carried out in the first half of the 1980s. Vertical and horizontal unbundling of generation, transmission and distribution and large scale privatization led to soaring private investment. The 1982 Electricity Act was amended three times in 1999, 2004 and 2005 after major electricity shortages. Further amendments are envisaged.

There are four separate electricity systems in Chile:

The long distances between the four systems made their integration difficult, but after the 600 km SIC-SING 500 kV AC transmission project costing US$1bn came online in May 2019, Chile's northern grid (SING) and central-southern grid (SIC) are now connected into a single national wide area synchronous grid.

Total installed nominal capacity in April 2010 was 15.94 GW. Of the installed capacity, 64.9% is thermal, 34% hydroelectric and nearly 1% wind power, with nuclear absent. The SING is mostly thermal and suffers from overcapacity, while the hydro-dominated SIC has been subject to rationing in dry years. Total generation in 2008 was 56.3 TW·h, 42% of which was contributed by hydropower sources. The remaining 58% was produced by thermal sources. This figure varies significantly from one year to another, depending upon the hydrology of the particular period. The electricity production grew rapidly since the start of natural gas imports from Argentina in the late 1990s.

Besides the new hydro projects (see Renewables section below), there are several large-scale thermal projects in the development pipeline for Chile. Numerous projects are being built, although other similar plants have been delayed due to opposition from locals and uncertainty about gas supply. It is this uncertainty that has directed new attention to coal-fired facilities, of which Chile already has several plants in operation, with a combined capacity of 2,042 MW. In addition, as of April 2010, there are plans to build new plants for a total of 11,852 MW of new generation capacity.

The main companies involved, in terms of installed capacity, are the following:

A number of other companies account for the remaining 14% (2418 MW)