Chile
Analysis

Chilean renewables: 2021 expected to break records

Bnamericas Published: Tuesday, April 06, 2021
Chilean renewables: 2021 expected to break records

Chile’s race to a 100% renewable grid is expected to continue this year as the addition of new projects to the country’s grid accelerates.

Starting in 2014, Chile has seen increasing participation of conventional and non-conventional renewable sources in its power matrix. In 2020, the change was more dramatic than ever, and renewable sources (including hydroelectric dams) reached 46.5% of total generation, the largest share in almost 15 years.

Source: BNamericas with data from Generadoras de Chile

When it comes to non-conventional renewable sources, wind and solar participation have grown consistently in the past half-decade, with NCRE generation growing every year since 2014 and comprising over 25% of the total by the end of 2020. According to grid coordinator CEN, at the end of 2020 solar and wind made up over 23% of Chile’s total generation capacity.

The surge in clean energy generation comes as the country aims to be carbon-neutral by 2050, which involves retiring all its coal-fired capacity by 2040 as well as becoming an international player in the hydrogen economy and implementing a series of strategies to increase power consumption efficiency. 

Data presented by energy commission CNE suggests Chile is about to see an explosion in new renewable additions starting this year. The regulator said at the beginning of the year that 5.9GW of new renewable capacity were under construction, with the majority expected to come online this year.

CNE data shows about 4GW of new projects are expected to start operations this year, compared with 2020 additions of 1.36GW, although the regulator’s forecasts depend on project deadlines not changing. In January 2020, CNE estimated 2.4GW of renewable projects would start operations last year, about 1GW more than the final figure.

Even accounting for possible delays, 2021 is poised to dwarf the capacity added in previous years, as shown in the graph below. The “corrected” forecast adjusts CNE’s predictions considering their deviation from previous years.

Source: BNamericas with CNE and Acera data

The speed of the grid’s transformation has led some observers and legislators to suggest Chile should increase the pace of its coal retirement plan. Last year, legislators proposed forbidding the operation or installation of coal-fired plants from 2026 amid criticism from several market players.

According to Carlos Finat, executive director of renewable trade group Acera, while an updated coal retirement plan that would ensure energy supply and grid stability is possible, full retirement by 2025 could jeopardize the grid.

“The idea to retire coal plants by 2025 lacks technical and economic justification and that, if forced through by law, could lead to a high risk of supply interruption and a rise in the marginal cost of the system,” Finat told BNamericas.

Meanwhile, small and medium distributed generation projects, known in Chile as PMGDs, are playing an increasing role in the country’s renewable growth.

A new report by CEN shows that 78 out of the 90 generators that started operations last year were PMGD projects, with combined capacity of 322MW.

As of the end of March, over 100 new PMGD projects had been filed for environmental approval with evaluation service SEA for combined investment totaling US$1bn.

PMGD projects have grown despite the fact that the sector faced changes to the stabilized price regime – a special incentive that shields PMGDs from sudden changes in spot market pricing.

The generation projects due to come online this year in Chile include the following, according to BNamericas' data.

Proyecto Hidroeléctrico Alto Maipo

Planta de Concentración Solar de Potencia Likana Solar

Planta Solar Cerro Dominador (ex Atacama 1)

Planta de Ciclo Combinado El Campesino

Parque Eólico Cerro Tigre

Parque Fotovoltaico Cielos de Tarapacá

Parque Eólico Caman

Proyecto Fotovoltaico PV Coya

Parque Eólico Entre Ríos

Parque Eólico Malleco

Parque Eólico Llanos del Viento

Proyecto Campos del Sol Sur

Parque Eólico Campo Lindo

Parque Eólico Mesamávida

Parque Fotovoltaico Aurora Solar

Parque Eólico Chiloé

Parque Solar Fotovoltaico Sol del Desierto

Central Hidroeléctrica Rucalhue

Parque Eólico Alena

Parque Eólico Tchamma

Parque Fotovoltaico Kimal Solar

Nueva Caldera de Cogeneración Eléctrica (Proyecto MAPA)

Parque Eólico Lomas de Duqueco

Parque Fotovoltaico Santa Isabel 

Parque Eólico Calama (Optimización y Ampliación del Proyecto Parque Eólico Calama B)

Parque Fotovoltaico Willka

Parque Solar Río Escondido (Proyecto Escondido Solar)

Parque Eólico Cabo Leones III

Parque Fotovoltaico Atacama Solar

Parque Eólico Ckani

Parque Eólico Puelche (Renaico II)

Modificación Proyecto Fotovoltaico Valle del Sol

Planta Fotovoltaica Meseta de Los Andes

Proyecto Fotovoltaico Domeyko Oeste (Ex Domeyko 2)

Proyecto Solar Valle Escondido

Parque Fotovoltaico Pampa Tigre

Proyecto Fotovoltaico Sol de Lila

Embalse Chironta

Parque Fotovoltaico Alcones

Parque Eólico Las Viñas (Renaico II)

Planta Fotovoltaica Malgarida II

Actualización Proyecto La Cruz Solar

Ampliación Parque Fotovoltaico Finis Terrae (Ex Crucero Este, Blue Sky)

Central Eléctrica Cala Morritos

Proyecto Fotovoltaico Sol de Los Andes

Parque Eólico Camarico

Parque Solar Don Sebastián

Planta Fotovoltaica Tamaya Solar

Parque Eólico Vergara

Parque Fotovoltaico Capricornio

Central Eléctrica Canelillo

Parque Fotovoltaico Lince Solar

Parque Eólico La Estrella

Proyecto Fotovoltaico Azabache

Planta Solar Fotovoltaica Malgarida

Parque Solar Quillagua (Fase II)

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