Chile's environmental evaluation service has given the green light to the construction of a 162MW solar power park in the mineral-rich Atacama region.

The move, which was announced yesterday,  provides a small boost for energy-starved mining projects in the mainly desert area.

According to Reuters, Irish Mainstream Renewable Power said its roughly $420 million Diego de Almagro solar photovoltaic park would have a 20-year lifespan.

Projects in the Atacama region are reported to have been at risk after the controversial decision by the Supreme Court to reject Brazilian billionaire Eike Batista's planned joint venture with Germany's E.ON to build a  $5 billion Central Castilla theromoelectric power plant project in August.

The ambitious project was turned down because of environmental concerns.

In its report, Reuters warns that Chile is failing to take a firm hand in regulating its mining and energy industries, leaving billions of dollars worth of projects exposed to the risk of lawsuits by local communities in the world's number one copper producer.

Libertad y Desarrollo, a conservative think-tank in Santiago, claims that more than US$22 billion and over 8,000MW in energy investment are currently suspended due in part to legal disputes and regulatory delays.

Diego de Almagro's energy would be pumped into the central SIC energy grid, which supplies power to over 90 percent of the population and is seen as more fragile than the northern grid.