Chile wants to take advantage of the green boom to sell renewable energy

The Administration of President Gabriel Boric is increasing grants and loans to developers, but will refrain from resorting to subsidies, said the energy minister, diego brown. It will maintain some of the previous government’s energy policies, such as the approval of a storage incentive bill, but will modify policies for greater community participation and technology transfer.

“We will keep the promises made to the companies that have invested in Chile, but we want to create new opportunitiesthe Berkeley-trained lawyer said in an interview with Bloomberg Television.

With the sunny Atacama desert to the north and windswept Patagonia to the south, Chile is in a prime position to produce renewable energy, which can be used to extract hydrogen from water to create an alternative to diesel in its massive mining industry. Its expansion would help meet the country’s carbon targets and encourage companies to make the switch amid increasing scrutiny of investors’ environmental credentials.

In addition to more grants and loans, authorities are working to ease land use regulations and bolster local regulatory teams with qualified professionals to improve impact assessments. They are also working with communities and universities in an attempt to turn southern and northern areas with fossil fuel histories into green energy hubs.

However, the government will not offer any direct subsidies for the export of hydrogen, as that would breach World Trade Organization (WTO) regulations. “We must be very careful with the tools we use to encourage this sectorPardo said.

Governments around the world hope to encourage the evolution of green hydrogen by reducing costs. As part of its national fuel strategy, the Chilean government plans to begin evaluating before the end of the year whether to maintain the previous administration’s target cost of $1.50 a kilogram by 2030, Pardow said. Current costs are much higher than that, he noted.

The government is working with the state-owned Empresa Nacional del Petróleo (Enap) to participate in joint efforts with private developers to allow their infrastructure to be used for green hydrogen.

Regarding an initiative to shut down all coal-fired power plants in Chile by 2025, Pardow said more needs to be done to meet changing energy demand with renewable alternatives. “It is not feasible to do it by 2025.”.