How Gas Interests Hindered Chile’s Shift to Renewable Power

Chile positions itself as a worldwide climate change leader. Solar and wind projects generate about 22 percent of Chile’s electricity, greatly exceeding the global average of 10 percent. In 2008, it was one of the first governments to establish sustainability targets.

Despite the fact that solar panels have grown across the northern and central of the long, thin country, imported fossil fuels have been able to overshadow the green power they generate owing to a government backdoor agreement.

According to Marcelo Mena, a former Chilean environment minister, he grew frustrated after witnessing renewable energy being forced out by fossil energy in the country’s north, where sunlight is most abundant. Simultaneously, folks in Chile’s south are heating homes with firewood and suffocating over it.

The shock that triggered Chile’s energy transition occurred in the mid-2000s when Chileans were subjected to stringent power rationing and frequent outages. The nation sensed an opportunity after scurrying to find an alternative.

Chile has some of the world’s strongest and most continuous sunshine, particularly in the north. As a result, it was only reasonable for the government to seek funding for solar and wind power projects.

Investors responded, and developers erected hundreds of photovoltaic, turbine, and geothermal units across the country. However, the devil was always in the small details. The administration also massively invested in fossil fuel systems to provide electricity when the sunlight was not blazing.

Natural gas importers and owners of gas-fired power stations successfully argued that to win long-term gas contracts. They sought assurances that the Chilean distributed generation would accept their gas-fired energy even when alternative, cleaner generators were producing enough.

Colbun, a big user of natural gas in Chile, said foreign contracts requiring LNG buyers to pay for energy whether they want it or not, combined with a lack of options, make the sector susceptible.

In essence, the government enabled them to claim LNG import power as enforced gas, which meant that gas-fuelled energy was given precedence in the electricity markets, which otherwise benefits renewables.

Ana La Rojas, the CARES leader, warned that any condition in the electrical market that favors fossil fuels over renewable sources is a loss for the ecosystem and the emissions reduction.

Emissions from the combustion of gas, oil, and coal for power, commerce, and other purposes are the primary cause of climate change. Researchers projected last year that over 60% of the world’s energy resources, and 90% of coal stocks, must remain underneath by 2050 to accommodate the Paris Climate Agreement’s targets.

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