Energy profile: Chile
Fuel mix (fossil fuels vs renewables)
Chile derives roughly two thirds of its total energy supply from fossil fuels, with oil, coal and natural gas all playing key roles; biofuels, together with smaller amounts of hydro, wind and solar, account for the remainder.
In 2020, fossil fuels provided roughly half of Chile's installed electrical capacity and power generation; additional electricity was generated by hydro (26.5%), solar (9.8%, up from 8% in 2019), wind (7.1%, up from 6%) and other renewables including biomass and geothermal energy (roughly 5%).
Greenhouse gas emissions targets
As of 2020, Chlle's per capita CO2 emissions from fuel combustion (4.1 tons annually) were the highest in Latin America and the Caribbean, though still relatively small by international standards, ranking only 37th globally. Chile's NDC (Nationally Determined Contribution) target for 2030 calls for a 30% reduction in GHG emissions.
Government energy agencies & other key players
National energy agencies
Chile's Ministerio de Energía is the government ministry in charge of energy policy.
SMA (Superintendencia del Medio Ambiente) is Chile's environmental authority, responsible for granting licenses for new power generation projects.
State-owned CNE (Comisión Nacional de Energía) is the agency charged with regulating production, generation, transport, and distribution of energy in Chile.
Superintendencia de Electricidad y Combustibles the government regulator for Chile's oil, natural gas, and biofuels sector.
State-owned CNE (Comisión Nacional de Energía) is Chile's largest electric utility company.
National oil company
ENAP (Empresa Nacional del Petróleo) is Chile's national oil company, responsible for exploration and production of hydrocarbons and geothermal energy.
Leading energy companies
Major private energy companies operating in Chile include Enel, Colbún, Engie, and AES Gener.
Chile consumed 76 TWh of electricity in 2018, ranking 38th in the world.
Coal in Chile
Chile was Latin America's third largest consumer of coal in 2019, after Brazil and Mexico. Consumption totaled 13.4 million tonnes in 2019.
Coal consumption is expected to decrease as a result of Chile's national decarbonization plan, which calls for all of the nation's coal-fired power plants to shut down by 2040. At the time the plan was announced in 2019, roughly 40% of Chile’s electricity was supplied by 28 operating coal-fired units, which had a combined capacity of 5,541 megawatts (MW), mostly fueled by imported coal. The government’s original plan called for the shutdown of eight units totaling 1,069 MW by 2024, with the remainder to be decommissioned between 2025 and 2040. The shutdown schedule has since been accelerated, with 18 units and 3,585 MW slated for decommissioning by 2025. Enel has already retired its Patache (Tarapaca) and Bocamina 1 units, and will decommission its lone remaining coal unit, Bocamina 2, in 2022. Engie retired its Tocopilla units 12 and 13 in 2019, and will shut down units 14 and 15 in 2022, followed in 2024 by Mejillones units 1 and 2. In 2025, Engie will convert its Mejillones IEM and Andina-Hornitos units to run on gas and biomass, respectively. AES has committed to shutting down its Angamos units 1 and 2 and Ventanas units 2, 3 and 4 by 2025. Ten other coal-fired units with total generating capacity of 1956 MW are slated for shutdown between 2026 and 2040, including AES’s Norgener (Nueva Tocopilla) and Cochrane, Colbún’s Santa María and Capital Investments’ Guacolda units.
Chile is a founding member of the No New Coal Power Compact, launched in September 2021 by a coalition of seven governments that have agreed to cease permitting of new coal power plants and end new construction of unabated coal plants. Chile is also a signatory to the Global Coal to Clean Power Transition Statement, announced at the COP 26 conference in Glasgow in November 2021.
Imports & source countries
Oil & Natural Gas in Chile
Chile has large, undeveloped reserves of shale gas. However, the country is not a significant producer of fossil fuels and must import most of its oil and natural gas. Chile produced only 22,000 barrels per day of petroleum products in 2020, and 1.2 billion cubic meters of natural gas in 2018.
In 2018 Chile consumed 363,000 barrels per day of petroleum products and 5.4 billion cubic meters of natural gas.
Imports & source countries
Chile imported just over 2 billion tonnes of natural gas and nearly 11 billion tonnes of oil in 2019. Chile imports natural gas by pipeline from neighboring Argentina, and by sea from several other countries, including Trinidad and Tobago, Algeria, Qatar, Equatorial Guinea, the United States, and Mexico. The country's two main LNG import terminals are the Quintero LNG Terminal and the Mejillones LNG Terminal.
Four international pipelines - the Atacama Pipeline, the Nor Andino Pipeline, the GasAndes Pipeline, and the Gasoducto del Pacífico - cross the Andes between Chile and Argentina, allowing Chile to import Argentine natural gas. However, supplies are intermittent, and Argentina's export capacity was completely shut down for more than a decade before flow resumed in 2018.
Renewable Energy in Chile
In 2019, Chile announced its intention to achieve carbon neutrality by 2050. Between 2014 and 2020, the country steadily increased the renewables component of its energy mix from 3% to 25%, with solar and wind power combining to account for 23% of electricity generation by the end of 2020 and 23.5% in the first half of 2021. Companies such as Enel and Engie have shifted their Chilean investments away from coal power to alternate sources such as solar and wind. Chile has some of the highest levels of solar radiation on earth, making it a prime candidate for photovoltaic energy development, and the Magallanes region in southern Chile is being touted as a prime site for wind-powered green hydrogen projects. Chile is also a leading producer of lithium, a key element in electric vehicle batteries; the country held an estimated 55.5% of global lithium reserves as of 2019.
Iron & Steel in Chile
Dating to 1950, Chile's CAP Acero steel plant is one of South America's largest and longest established steelmakers, based on the older and more energy-intensive blast furnace/basic oxygen furnace technology. The plant uses iron ore from mines in northern Chile, which are concentrated in the three northern regions of Atacama, Antofagasta, and Coquimbo.
Community groups in Chile have long opposed coal on health, safety, and environmental grounds. Residents of Chile's five so-called 'sacrifice zones' - the communities of Mejillones, Tocopilla, Quintero-Puchuncaví, Coronel, and Huasco, where coal-fired power plants and other polluting industries are heavily concentrated -- are vulnerable to a variety of associated health and safety impacts, including higher risk of respiratory disease and cancer. Development of Chile's vast lithium reserves is already having negative impacts on the fragile Atacama desert ecosystems and indigenous communities of northern Chile, including severe depletion of local water resources.
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