Background on Chile’s Green Hydrogen Initiative
Chile has been actively promoting the green hydrogen industry as an alternative to fossil fuels, aligning with global efforts towards decarbonization. The country’s Minister of Energy, Diego Pardow, announced adjustments to the nation’s green hydrogen development goals due to a cooling international market.
Market Slowdown and Its Impact
According to Pardow, the global green hydrogen market has cooled down, prompting Chile to revise its targets. The International Energy Agency (IEA) reported that a wave of cancellations, cost pressures, and policy uncertainty have reduced the project pipeline by almost a quarter for 2030.
Chile’s Current Green Hydrogen Projects
Despite the market slowdown, Chile maintains a robust project portfolio with favorable environmental permits or those nearing approval. These projects are of commercial scale, as stated by Pardow.
- TotalEnergies and HIF Global are working on initiatives in the southern part of the country.
- The Minister of Finance, Nicolás Grau, mentioned that there are over 40,000 million dollars’ worth of projects currently under environmental evaluation.
- The government anticipates swift congressional approval of a support policy with approximately 3,000 million dollars in tax credits for smaller-scale projects.
Progress in Other Sectors of the Industry
Pardow expressed optimism about advancements in other sectors, such as energy storage capacity development. The government had forecasted adding two gigawatts of storage by 2030 and six for 2050.
- As of January, Chile will have two gigawatts in operation and eight under construction, which is an advancement towards the 2030 target and a significant step toward the 2050 goal.
- The minister believes that progress in energy storage can help mitigate energy waste in countries with high clean energy penetration while strengthening the transmission system.
Addressing Recent Power Outages
Pardow addressed the recent nationwide blackout in February, stating that explanations suggest a compliance gap rather than insufficient investment.
- Investment reasons in transmission infrastructure are more about the economic opportunity for increased productivity than avoiding situations like the February blackout.
Enel Distribution Concession Analysis
Pardow mentioned that the government is still analyzing the possibility of revoking Enel’s distribution concession in the capital region, with no set date for a resolution.
- The 18-month estimated timeline would conclude in May, according to Pardow.
- The government initiated the concession evaluation process following prolonged service failures by Enel after heavy rains in the central-south region midway through the previous year.
- Pardow emphasized that any decision, regardless of outcome, must be technically correct and thorough.
- He stressed the importance of quality work over time, ensuring that the Electricity Superintendency has ample space to conduct a technically sound evaluation.
