Solar Power in Chile: A Brief Introduction
As a classic case of being a child that just wants all the toys, ever since starting this fellowship I have moaned about missing out on Africa and South America. You'd think 12 month in five countries would be enough, but after spending 10 weeks in Germany I realized that given the short amount of time in each place, the benefit of seeing a new country at the sacrifice of a few less weeks in a country seemed a sacrifice worth making. The plan so far is to take two weeks from my time in Australia and India, to spend a month in Chile.
There has been a lot of buzz around Latin America in the solar industry and Chile seems to be at the epicenter of this buzz. With the best solar irradiation in the world, a fairly open market, reasonably developed infrastructure, and a renewable energy support scheme, solar companies have come from across the globe to develop projects in Chile. I spoke with a person at Spanish solar company yesterday and when asked about the Spanish solar industry, they responded "There is nothing left of the Spanish solar industry. None." The company is trying to develop projects in Latin America, mainly Chile, Mexico, and Brazil. It seems many european solar developers have been forced to find other markets as the European market has declined.
In this blog I will offer just a brief description to the Chilean solar industry.
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| A map of solar irradiance across the globe. |
As can be seen from the solar irradiance map above, the west coast of South America were Chile is located has the greatest solar resource of all countries across the globe. Just on a funny note, look at the solar resource of Germany in the blue region. The past development of solar has been policy driven and thus especially vulnerable to the curtailment of those policies. However, as the price of solar has come down, companies are become less reliant on subsidies and in some case going without them.
First Solar, an Arizona based producers of CaTe thin film cells, has announced it will develop a 162 MW power plant in Chile subsidy free.[1] First Solar strategically acquired a Chilean development company called Solar Chile, which was originally funded as a public-private partnership between the government and a few mining industries. In addition to the 1.5 GW pipeline of early stage projects in northern Chile, the acquisition provided First Solar with a local knowledge base as well as a network of government officials and mining companies. This is especially important since mining companies will be the main customers for solar power plants as they seek to "green" their image as well as control their own power. Electricity is expensive in Chile with the cost per kWh reaching $0.25. By selling the power to mining companies, developers are able to by-pass a weak grid and a highly regulated electricity market. As an additional benefit, mining companies have already installed energy storage because of the weak grid.
In a similar move, SunEdison has signed an agreement with CAP, the largest iron ore mining, steel production, and steel processing company in Chile for a 100 MW power plant. This plant will be the largest solar plant in South America. [2]
On a final note we can look at the Chilean market as a whole as it compares to other countries in South America.
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| Solar power in Latin America. [1] |
The graph above shows the huge expansion of the Chilean solar market and shows just how recent that expansion occurred. Almost the entire stock of development is still under construction.
I was only planning on spending a month in Chile, but the more research I do, the more I think I need more time!
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