Rich in renewable energy, Chile seeks to become global hydrogen powerhouse


As a net importer of fuels, Chile has not been a significant player in global energy markets. But the sun-drenched, wind-rich South American country aims to become a titan in the burgeoning green hydrogen economy, setting a goal to become one of the world’s top three exporters by 2040. The hydrogen economy is still taking shape, and the world is waiting for the costs of the technology to fall. Multinational companies are taking up the offer, looking to use Chile’s rich renewable energy resources to make breakthroughs in green hydrogen and take advantage of potential government subsidies. To learn more, read, “Rich in renewable energy, Chile seeks to become global hydrogen powerhouse.”

Key Takeaways:

  • Chilean President Sebastian Piñera’s outgoing administration launched its National Green Hydrogen Strategy in November 2020.
    • The goal is to have 5 GW of electrolysis capacity under development by 2025 and to create the cheapest green hydrogen on the planet by 2030.
  • Mining companies in the region are looking to hydrogen to slash operational costs by eliminating the expensive importation of diesel fuel.
    • They also believe green hydrogen can be used for electricity at mining sites alongside cheap renewable energy resources.
  • Beyond mining, companies are using Chile as a testing ground to create both ammonia and synthetic fuels from green hydrogen.
  • Roughly half of Chile’s installed power generation capacity for 2021 was sourced with renewable energy resources, making the production of green hydrogen easier.
  • Operators of coal-fired plants in the country, including international firms AES Corp., Enel SpA and Engie SA, have announced plans in 2021 to shut down such facilities and increase investments in renewables.

Path to 100% Perspective:

Chile has one of the most ambitious decarbonization plans in the world, targeting carbon neutral electricity in 2050. This South American country is already at a 70% renewable energy share with some of the world´s best wind and solar resources available. It is possible to retire coal in Chile before 2030 and to reach a 100% carbon neutral power system before 2050. Although competitive renewable energy and battery storage are available, the missing piece of the puzzle is long-term energy storage, which has the role of ensuring proper system function and reliability even during longer usual weather patterns such as drought, extreme heat or cold waves, cloud cover and rain, low wind periods as well as low solar seasons such as winter. Utilizing the Power-to-Fuel-to-Power as the long term energy storage can save Chile an estimated 17 billion dollars or 26% in investments and enables lower generation costs with better system reliability.


Photo by Ximena Nahmias on Unsplash