Chile - Country Commercial Guide
Energy

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2022-01-25

Overview

Chile’s clean energy sector is a critical sector as the country seeks to meet ambitious clean energy goals set out in the National Energy Policy 2050. The top initiative under the plan is to achieve carbon neutrality by 2050. Other priorities include increasing the percentage of energy consumption from clean energy sources to 70 percent by 2030. As of 2020, 45 percent of energy consumption comes from clean energy. Solar photovoltaic (PV) and wind power grew by 27.7 percent and 17.7 percent, respectively. Chile also plans to phase out coal power generation by 2040. Green hydrogen is the latest government clean energy priority. The Ministry of Energy released the National Green Hydrogen Strategy in December 2020 with goal of making Chile the top exporter of hydrogen by 2050.

The Ministry of Energy is the main government energy policy agency. The National Energy Commission is a technical organization, responsible for analyzing prices, tariffs and technical norms with which energy production, generation, transport, and distribution companies must comply, in order to ensure sufficient, safe, quality service, compatible with the most economic operation. The National Electric Coordinator, an independent system operator, is a technical and independent body responsible for the reliable, secure, and efficient operation of the national electric system. The Fuel and Electricity Superintendency is an office of the Ministry of Energy, responsible for monitoring the proper operation of the electricity, gas and fuel services. The office also 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.

The energy sector is privately owned, including generation, transmission, and distribution, and is operated by both foreign and local companies. The leading generation companies are AES Andes, a subsidiary of AES Corp, Colbún S.A., Enel, and Engie. AES Andes is the second-largest power producer. In June 2021, EIG Global Energy Partners inaugurated Cerro Dominador, the first concentrated solar plant in Latin America. Colbún S.A. is developing the 208 MW PV Almagro Sur solar project in Atacama, northern Chile, and Mainstream, a European energy company, is developing the first phase of Parque Eólico Caman, a 146 MW wind farm located in Valdivia, southern Chile.

As of December 2020, the installed power capacity was 26,310 MW. The mining sector is the largest consumer of energy representing around 30 percent of total electricity energy consumption. During 2020, the average marginal cost of energy at the Quillota 220Kv node in the Northern Grid was $40 MW-h. Energy annual growth relative to 2019 was .07 percent, a decline caused by lower economic activity due to the pandemic.

The U.S. supplies over 10 percent of parts and equipment to the sector and has a reputation for quality and service. However, given the high number of trade agreements and the market openness, foreign competition is strong particularly from Asian suppliers. China is becoming a relevant player in the sector investing in generation via Pacific Hydro, in transmission via Transelec, and in distribution via CGE. In 2020, according to InvestChile, the value of investment in energy projects contributed $ 5.4 billion to the total value of investment of $8.5 billion. The U.S. is one of the top 3 investors in Chile together with Canada and China.

Total Market Size

 

2018

2019

2020

2021 est.

Total Chile Imports

1,497

1,674

2,876

3,000

Imports from the United States

123

144

95

90

U.S. Share of Imports

8%

9%

3%

3%

Source: Thomson Reuters-CHECKPOINT (Electrical Energy Equipment - HTS 8402, 8403, 8404, 8405, 8501, 8502, 8504, 8532, 8535, 8541, 8544, 9028)

Units: US$ million

Leading Sub-Sectors

Promising sub-sectors include:

· Wind Turbines

· PV Panels and Inverters

· HVAC & HVDC Transmission line cables and converter stations

· Transmission line monitoring equipment

· Hydrolysis plants, equipment, and parts

· Hydrogen storage and transportation equipment

· Carbon footprint reduction services and technology

· Coal Power plant decommissioning technologies and services

· Smart Grid technology and services

· Grid security and monitoring technologies and services

· Personal Safety Equipment

Opportunities                                                                                         

The National Electric Coordinator predicts that investment in transmission development projects will total $3.2 billion between 2021 and 2025. Approximately one third of this amount will go into the 1,500 Km HVDC Kimal – Lo Aguirre power transmission project.

There are an estimated $23 billion in renewable energy investment projects at different development stages: 2 percent are in the preliminary studies phase, 8 percent are in the under-evaluation phase; 43 percent have approved environmental permits, and 47 percent are under construction. Of the total projects, 40 percent are solar and 33 percent are wind. Wind farms projects are under development in both the north and south. The Chilean Association for Renewable Energy (ACERA) maintains a list of renewable energy projects.​

There are limited subsidies available for the sector, however, the Ministry of Energy has announced new subsidy programs for feasibility studies and to promote the development of the green hydrogen initiative. ​

Resources

· Solar Expo Chile, Dates TBA, Santiago Chile

Solar Expo Chile is a national and international event to exhibit, promote, market, and develop products, services, and innovation through the participation of the most important players in the solar energy industry. Dates for 2021 to be announced.

· EXPOENERGÍA, December 15, 2021, Santiago, Chile

ExpoEnergia is a local trade show featuring technological solutions for the supply, efficiency, quality, and safety of energy in the local industry.

· Expomin, October 25-29, 2021, Santiago, Chile

· EXPONOR, June 20-23, 2022, Antofagasta, Chile

EXPONOR is Chile’s second largest mining trade show also features an energy pavilion. The U.S Pavilion features about 70 exhibitors.

 

· American Chamber of Commerce

· Ministry of Energy

· National Energy Commission (CNE)

· National Electric Coordinator

· Fuel and Electricity Superintendence (SEC)

· Chilean Association for Renewable Energy (ACERA)

· Chilean Association for Solar Energy (ACESOL)

For more information about opportunities in this sector contact U.S. Commercial Service Industry Specialist: Marcelo Orellana, marcelo.orellana@trade.gov