lamina de huracan - columbia global centers...chile: leading the path on solar energy sustainable...
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LAMINA DE HURACAN
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Chilean Energy Overview
Chile: Leading the Path on Solar Energy
Sustainable Energy DivisionMinistry of Energy - Government of Chile
September 9, 2019
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Chilean Energy Context
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• 17.6 MM inhabitants
• GDP/capita of USD 22.7 M
• High dependency from imported fossil fuels
• Low level of electricity and gasinterconnection with the region
• High renewable potential
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4Source: National Energy Balance, Ministry of Energy, 2017
Primary Energy Offer and Final Consumption
29%
15%
24%
25%
5%
1% 1% 0% 0%
Oil Gas Coal Biomass - Firewood Hydro Wind Solar Biogas Geothermal
2%
39%
36%
23%
Self-consumptionIndustrial and MiningTransportCommercial, Public, Sanitary and Residencial
Primary Energy Offer Final Energy Consumption
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1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
USD/MWhGWh
Geothermal
Solar
Wind
Biomass
CHP
Hydro
Oil
Gas
Coal
Northen Chile Spot Price(R-axis)
Central Chile Spot Price(R-axis)
Evolution of Electric Generation in Chile
5Agreement on international
natural gas imports Consecutive
dry yearsNatural gas
cutbacks
Source: National Energy Commission
201846% of renewable generation
(18% of NCRE)
All new generation from renewables
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According to different studies, the futuredevelopment of the energy matrix isforecasted to remain renewable.
Chile ranked #1 on the 2018 Climatescope ranking of attractive emerging markets for clean energy investments.
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Renewable Future
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High Renewable Energy Potential
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Atacama DesertHighest level of solar radiation in the world
>3.500 KWh/m2/Year (DIN)
>3.000 Sun hours/Year
<2mm rainfall/Year
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Potential estimated by the Ministry of Energy for the last Long Term Energy Planning process.
High Renewable Energy Potential
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>72x Chile’s installed capacity
~1.7 times the installed capacity of USA
Over 30 GW undeveloped capacity with environmental approval
Technology Potential [GW]
Wind 37
Hydro 6
Solar-PV 1,194
Solar-CSP 510
Geothermal 2
Total 1,749
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10Felipe Cantillana - MarcaChile
Cost Driven Change
• The price of PV systems continues to decrease as results of technology innovations, economies of scale and manufacturing experience.
• Competitive offers in tender
Global average LCOEs and auction results for utility-scale PV by commissioning date
Source: IEA - Analysis from Renewables 2018 Source: National Energy Comision, Chile
Tender in Chile for Regulated Costumers
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María José Pedraza- MarcaChile
Solid Institucional FrameworkChile leads to an attractive country for clean energy investments.
• Controlled inflation.
• Responsible fiscal policy.
• Controlled fiscal deficit.
• Good risk rating (Moody’s A1, S&P A+, Fitch A).
Power Sector
• Liberalized, competitive and unsubsidized market.
• Generation: Spot market based on audited costs.
• Transmission: Centrally planned for national grid.
• Distribution: Regulated monopoly.
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Ave
rage
bp
s
Emerging Markets Bond Index Global Spread
Chile
LatAm
Global
Europe
Asia
Source: Central Bank of Chile
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There is wide agreement that Solar is important in Chile’s energy future
Path to 100% Renewables, Wärtsilä 2019
Solar Future
Decarbonization development and operation study,
Coordinador Electrico Nacional (ISO), 2018
PELP, Ministry of Energy 2018 Propuesta regulatoria sobre flexibilidad, Valgesta, 2019
Long term analysis for SEN,
Moray and PSR, 2018
Generation Mix
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Towards a sustainable energy transition
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• Allow development of flexibles systems that allow integration massive amount of renewables.
• High quality projects not only from technical point of view, but also solid involvements with comminutes.
• Allow development of new solutions (Storage, Electromobility, Demand Side Management, Energy Efficiency, Internet of Things, Smart Grids, etc.)
Information Systems
Forecast
Systems
Communication, Monitoring and Control Systems
Flexibility from the current facilities
Flexibility from the demand
Development of the Transmission
System
Flexibility from the future facilities
New alternatives of flexibility
Regional Integration
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Solar development is growing in all segmentsNot only Utility scale…
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Utility Scale
Al size of projects. Generators connect to the grid, accessing to the liberalizedmarket (PPAs or Merchant). Dispatched under command of the ISO.
# Projects: 33
Solar Installed Capacity: 2,108 MW
PMGD/PMG
Projects up to 9 MW, connected to distributions or transmission grid undersome special conditions. Can access spot market or an stabilized price scheme.
# Projects: 131
Solar Installed Capacity: 517 MW
Net-billing
Regulated clients can connect projects up to 300kW for self-consumption, butsurpluses feed to grid and are valued in your electricity bill.
# Projects: 5,874
Solar Installed Capacity: 38.5 MW
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Why are solar and other renewables important for Chile?
Solar and renewables have proven to be the most competitive option,
lower dependence on imported fuels,
opportunity to become energy exporter,
and also….
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Most CO2 emissions are from Energy Sector
Source: Inventario Nacional de GEI 1990-2016, Ministry of Environment Chile
GHG emissions in Chile:
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• Chile has committed (in June 2019) to reach carbon neutrality by 2050
• Phase out plan of coal power plants by 2040 (!)
(8 will be closed by 2023)
• Other actions in transport, heat, cooling, efficiency, etc.17
Energy: highest opportunities to lower emissions of GHG in Chile
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Thermal Use (Heating and Cooling)Renewables allow decarbonization in other uses further than electricity.
• Represents 36% of total energy consumption in 2017.
• Opportunities for solar energy (and other renewables)
in industrial and residential sector.
• Renewable Thermal National Strategy under development during 2019.
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Green Hydrogen & Power-to-X
• Competitiveness of green hydrogendepends on energy cost (+CAPEX and running
hours)
• Chile’s potential has been highlighted by several international publications.(IEA, IRENA, WEC, BNEF, Asia Pacific Energy Research Center, JülichResearch Institute, among others)
• Potential uses go beyond energy sector and is expected to be a 9 trillion USD industry by 2030.
A need for reaching worldwide carbon-neutralityHydrogen costs from hybrid solar PV and onshore wind systems in the long term
Source: “The Future of Hydrogen” IEA 2019
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Our vision for the future
Lead the energy transition, not only to adapt to the technological changes, but to accelerate its
development and become a leader of this process in the region.
Social and citizen stamp has to be part throughout the process
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Gabriel PrudencioHead of Sustainable Energies Divisiongprudencio@minenergía.cl
Thank you