Chile Now (Arguably) World’s Top Renewable Energy Market

Owing to Chile’s great renewable energy potential, its current reliance on expensive fossil fuel imports, its energy-intensive mining operations, and its supportive government, the country is now considered by many to be the world’s “top” renewable energy market.

While that exact title may be something that could be argued against (the sizes of the China, US, and Japan markets are much bigger), there’s no denying that the country’s renewables market has a lot going for it — something heavily reflected in the great interest that many major players have been showing in it as of late.

On that note, it’s worth mentioning that the country’s President, Michelle Bachelet, has approved (as of the time of writing this) 76 renewable energy projects just since she took office back on March 11.

Impressive numbers. But ones that certainly make sense when you consider that, even without any subsidies, and without factoring in the environmental costs of fossil fuels or nuclear, solar energy is already cost competitive (at grid parity) there. It actually — apparently — comes in cheaper than the average price ($130 per MW-hour) on Chile’s spot market.

Part of this is down to the country’s reliance on imported fossil fuels (which are quite expensive), and part of it is down to the decreased hydroelectricity production of recent years there — owing to extreme drought.

Sustainnovate provides a bit more:

Mining companies that account for approximate one third of the country’s electricity use are increasingly powering their activities with the use of solar power.

In total, $7 billion is estimated to go into the dozens of renewable energy projects planned in La Roja.

“Chile is our most favorite nation,” stated Pattern Energy Chief Executive Officer Michael Garland in an interview with Bloomberg. “It’s got a good economy, a stable political environment and it’s a bit of an energy island with few indigenous energy resources.”

This was reiterated by the head of Ernst & Young’s renewable energy team, Ben Warren, who stated: “Chile is the market with the highest level of activity in the world.”

For the time being, almost all of the renewable energy development in Chile is solar and wind, but the country also possesses considerable potential for geothermal energy development (137 volcanos). So look to see some of that potential developed sometime within the near future.

For more on this hot renewable energy market, see our Chile archives.

Image Credit: EC-L