Overview

Chile aims to reach carbon neutrality by 2050. Power generation companies have formally committed to retiring thermal power plants by 2040. Also, among the top government programs outlined to support this goal is the promotion of energy storage.

Chile has several long- and short-term Green Hydrogen goals. A long-term goal is to become a top world exporter of hydrogen by the year 2050. In the short term the country aims to have ten to twelve green hydrogen projects in development by the end of 2026.

According to a study published by the Chilean Association for Renewable Energy (ACERA), by the year 2030, the government aims to have 70 percent of energy consumption coming from renewable power sources, an increase from the current 33 percent. ACERA notes that between the years 2022 and 2025 over 5.0 gigawatts (GW) of renewable power per year is expected be installed. Chilean Law 20.571 promotes power generation by residential owners with installed capacity of up to 100 kilowatts (KW).

Chile’s electricity sector, including generation, transmission, and distribution, is privately owned and operated by both foreign and local companies. For example, AES Andes, a fully owned subsidiary of Arlington, VA-based AES Corp., is the second largest power producer.

As of December 2022, Chile’s Independent System Operator (Coordinador Electrico Nacional or CEN), reports an installed power capacity of 33,218 megawatts (MW), a 7.6 percent increase from the previous year. Of this total, 7,907 MW were solar, a 27.6 percent increase from 2021, and 4,328 MW were wind, a 22.4 percent increase from the previous year. During November 2022, the average marginal cost of energy at the Quillota 220 kilovolt node in the Northern Grid was $93.5 MW/hour.

The U.S. supplies, on average, over 7 percent of parts and equipment to the sector. The Made in USA brand enjoys a reputation for quality and top service. However, given the number of trade agreements and the market openness, foreign competition is strong, particularly from Asian suppliers.

The following table portrays the sector by looking at a sample set of electrical equipment harmonized codes.

Table: Sample Market Size for Chile Electrical Equipment (US$ Millions)

Units: US$ million

Source: Global Trade Atlas (HTS 7413, 7414, 8406, 8410, 8411, 841912, 8501, 8502, 8503, 8504, 8506, 8507, 8532-37, 8541-44, 8546-48, 8574)

Leading sectors include:

• Wind turbines
• Photo voltaic panels and inverters
• Battery storage systems
• HV-AC & HV-DC transmission line cables and converter stations
• Transmission line monitoring equipment
• Electrolysis plants, equipment, and parts
• Hydrogen storage and transportation equipment
• Carbon footprint reduction services and technology
• Coal power plant decommissioning services
• Smart grid technology and services
• Grid security and monitoring technologies and services
• Personal safety equipment

Opportunities

According to the Hydrogen Association, there are currently six Green Hydrogen projects at different development stages with a total combined investment of over $130 million. For the period 2022-25, according to CEN, investment in transmission development projects will total $3 billion.

Trade Shows

• EXPOENERGÍA a local trade show featuring technological solutions for the supply, efficiency, quality, and safety of energy in the local industry. The show will take place on November 29, 2023, in Santiago.
• EXPONOR Chile’s second largest mining trade show also features an energy pavilion. The show will take place on June 3-6, 2024, in the northern city of Antofagasta. The U.S Pavilion expects over 30 exhibitors.

Resources

• Ministry of Energy
• Chilean Association for Renewable Energies (https://acera.cl/), a 140-member association including developers, generators and suppliers of products and services, national and foreign, throughout the value chain of the Renewable Energy industry.
• Chilean Association of Solar Energy (https://acesol.cl/), a Trade Association that brings together companies interested in promoting the development of solar energy.
• Chilean Association of Power Generation companies (https://generadoras.cl/), an Industry Association that represents the electricity generation companies operating in Chile. It is made up of a broad and diverse group of companies that develop, build, and operate energy projects in all the technologies present in Chile.
• Chilean Association of Energy Transmission (https://www.transmisoras.cl/), an Industry Association that promotes the rationalization, development, and protection of the common activity of its partners, which is the electricity transmission industry. Also, it supports building a long-term vision regarding the role of the transmission sector to contribute to the development of Chile, and its energy integration with the region.
• National Energy Commission (https://www.cne.cl/en/), a technical organization, under the Ministry of Energy, responsible for analyzing prices, tariffs, and technical norms with which energy production, generation, transport, and distribution companies must comply, to ensure sufficient, safe-, quality-service, compatible with most economic operations.
• Coordinador Eléctrico Nacional (National Electric Coordinator or CEN), Chile’s Independent System Operator (ISO) (https://www.coordinador.cl/), a technical and independent body responsible for the reliable, secure, and efficient operation of the national electric system.
• Superintendencia de Electricidad y Combustibles (Fuel and Electricity Superintendent, SEC): (https://www.facebook.com/SuperintendenciaSEC/), an office of the Ministry of Energy, responsible for monitoring the proper operation of the electricity, gas, and fuel services. It supervises the compliance to the laws, regulations, and technical norms in the electricity, liquid fuels, and gas fields, to ensure the quality and safety of the services rendered.

For more information about this sector contact U.S. Commercial Service Industry Specialist: Marcelo Orellana