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Solar energy in Chile: challenges and opportunities

Solar energy in Chile: challenges and opportunities

Posted by José Peralta on August 08, 2014

Along with the rest of the world, Chile is facing rising energy consumption accompanied by more constrained resources.

However, where Chile’s energy challenge exceeds the international standard, is in its dependence on imported resources. Renewable energy can help Chile meet its energy demand while granting the nation the energy security it currently lacks.

While Chile is the fifth largest energy consumer in South America, it has almost no domestic energy resources. Oil and natural gas are heavily imported from foreign reserves and in 2012 Chile imported 97 percent of its coal consumption.

Although hydropower is their biggest energy source, supplying a third of the country’s power, plants are outdated and building new facilities is both expensive and unpopular among locals.

In addition, Chile’s mining industry is growing and expanding – which is good for the economy, but dramatically increases levels of energy consumption. Therefore  the growing need for energy, in combination with foreign dependency, makes Chile vulnerable to increases in energy costs completely outside of its control.

This is where renewables come in. “Renewable energy will solve a number of issues for Chile,” explains Kevin Smith, who specializes in solar energy.“It will promote foreign investments and create local jobs, it will provide a multitude of environmental benefits, diversify the energy sector, and allow for sustainable energy security in the long-term.”

Chile’s government also acknowledges the positive impact renewable energy could have on the country. With experts predicting a power shortage by 2017 if alternative forms of energy are not introduced, President Bachelet has proposed an ambitious energy agenda. She has set a target of 20 percent renewables by 2025, and with it 45 percent of newly built projects being renewable.

Kevin Smith is the CEO of SolarReserve, a solar energy company based in Santa Monica, California. SolarReserve is one of the many foreign renewable energy companies that have set up offices in Chile and are ready to invest in Chile right now.

Although Chile does not provide subsidies for any form of energy, incentive to invest stems from Chile’s current energy situation. Prices are high, demand is increasing, and international companies understand that.

Chile’s geography is also attracting energy companies, particularly solar. The Atacama Desert, located in Northern Chile, is the world’s highest desert, with most elevations reaching 8,000 feet. With such intense sunshine, Chile’s Atacama is the best quality solar resource in the world.

American solar companies with sites or proposed sites in Chile, in addition to SolarReserve, include First Solar and SunEdison. However, while both other companies are building Photovoltaic (PV) solar panel plants, which can only supply electricity during the day, SolarReserve’s plant involves new technology that can store solar energy, providing reliable electricity 24 hours per day.

SolarReserve’s solution utilizes proprietary rocket-science technology, developed in the U.S. to collect and store solar energy in order to provide reliable and non-intermittent electricity, day and night, just like a conventional fuel-burning plant but without the harmful emissions or hazardous wastes.

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