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Territorial planning, training seen vital to Chile’s green hydrogen push

Bnamericas Published: Tuesday, November 29, 2022

Skills training and construction of local supply chains – along with territorial planning – were outlined as challenges for Chile’s nascent green hydrogen sector.

Blessed with a wealth of renewable energy resources and available land for gigawatt-scale projects, Chile is well-positioned to ride the green hydrogen wave.

But as in other jurisdictions, multiple pieces of the planning, production and offtake jigsaw puzzle need slotting into place in a timely yet coordinated manner.

Opportunities exist to provide the requisite specialist skills training and build a local hydrogen supply chain and knowledge economy, British hydrogen expert Joe Howe told BNamericas.

Howe, an energy professor at University of Chester in the UK and chair of regional industry decarbonization body North West Hydrogen Alliance, said skills training and supply chain development was critical for Chile to squeeze out as much value as possible from sector investment.   

“We need in place those skills, those competences, we need to support those supply chains, acquire those skills locally,” said Howe, invited to Santiago by the British government to talk about the UK’s experience in the sphere of hydrogen.

“Chile could go about this by ensuring they have programs, courses in place that industry can buy into, that industry can say ‘we want that course or that course.’” He added that, both in Chile and the UK, training providers need to know what’s around the corner in terms of requirements. 

Apart from opportunities in technical areas, finance and component manufacturing, among others, demand may also exist for the likes of special purpose vehicles that can act as independent intermediaries between public and private sector stakeholders. 

Chilean energy minister Diego Pardow, in a recorded message shown Tuesday at conference World Hydrogen Latin America – which Howe participated in – cited the importance of early-stage community engagement and creating quality jobs.

Filippo Pellacani, a business development manager at Danish electrolyzer manufacturer Topsoe, told delegates that building the gigawatt-scale projects planned for Chile’s isolated Magallanes region would require filling a labor gap.

TERRITORIAL PLANNING

Multiple export-scale projects are targeting windswept Magallanes, where existing port infrastructure would need adapting and new infrastructure building to facilitate the delivery and installation of the thousands of wind turbines and other project elements planned.   

José Miguel Hernández, a partner at Chilean law firm Grupo Evans, told BNamericas that – apart from the technological aspects – a big part of the jigsaw was territorial planning.

To support economic competitiveness and meet demand, export-focused projects need to be big. Some 10 projects of gigawatt scale and together spanning some 1Mha are in the pipeline.

“Territorial regulation is very important, coexistence with communities,” Hernández said, citing the changes the hydrogen industry would bring to parts of the region, where farming, hydrocarbons extraction and tourism are key industries. 

Developing the clean energy projects in harmony with the environment is another consideration. “Having 1Mha of turbines has an environmental impact … I believe it is important to do territorial planning in advance, because when the technology is here … we can’t say we don’t have the territory,” he said on the sidelines of the event, organized by British firm Green Power Conferences. 

The energy ministry sought funds for territorial planning-related work in its draft budget proposal for 2023.

Chile is working on a green hydrogen roadmap to complement a strategy published by the previous administration. An associated public consultation is due to be launched in December. Key pillars of the future document – Plan de Acción 2020-30 – will be sustainable investment, regulations and institutions, and decarbonization and local development.

Chile has a portfolio of projects targeting the domestic offtake and export markets, leveraging wind resources in the south and solar in the north. Other challenges concern infrastructure adaption and tackling the “chicken and egg” problem of growing supply and demand in parallel. 

Howe, who contributed to the UK’s hydrogen strategy a chapter on realizing domestic economic benefits, said it was possible for Chile to adopt a dual-track approach of developing export-focused projects in tandem with plants designed to supply domestic offtakers.  

A pioneering e-fuels demonstration plant, Haru Oni, is being completed in Magallanes. 

In 2023, the government likely faces a year of key decisions concerning hydrogen development in a context of global competition for inward investment and electrolyzers.  

ALSO READ: Europe, Chile in talks on 217mn-euro green hydrogen infrastructure support package

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