Data Insight: Chilean energy storage projects in environmental review phase

The BNamericas project database contains US$13.6bn in Chilean energy storage projects in the environmental review phase.

The sum – based on research conducted mid-October – corresponds to both standalone systems and renewables-storage hybrid projects, for a total of around 60.

Rising renewables penetration and curtailment, along with favorable spreads between evening and daytime power prices, has whipped up interest in energy shifting applications.

Scope is also seen for energy storage system usage in the ancillary services market, to help keep the grid stable as the country gradually closes or converts coal-fired power stations. Usage in the transmission system is also seen as a demand driver.

The regulatory framework is maturing, with capacity transfer rules introduced this year and coordination and operation regulations due for publication this quarter. Greater clarity surrounding ancillary services rules is seen needed to spur interest in this application.

Regarding coordination and operation regulations, energy and projects lawyer Teresita Vial from Chilean legal firm ACU Abogados told BNamericas: “According to the energy ministry, the objective of modifying the regulation related to storage is to simplify and harmonize the set of rules associated with storage systems to provide certainty to system actors, ensure certainty in the way storage systems will operate, and modernize the operation of the electrical system and market.”

For now, lithium-ion technology dominates but amid a growing industry focus on “decarbonizing the night” space should emerge for other technologies, particularly those well-suited to long duration applications, such as molten salt solutions, flow batteries or carbon dioxide batteries. 

In terms of decarbonization, through 2030 storage investment is forecast to support an increase of at least 14% in renewable energy injections into the grid and enable a reduction in thermoelectric output. This would also help address curtailment, which currently stands at around 15% of renewable energy production.

Central region Valparaíso – close to demand hubs – and northern region Atacama – closer to production hubs – are the top two jurisdictions in terms of number of planned systems. 

CREDIT: BNamericas

10 biggest storage project developers by capex, based on projects in environmental review phase. CREDIT: BNamericas

Chile is on track to hit a goal of having 2GW of storage built or in the construction phase in 2026, with the next headline goal 6GW by 2030.

In terms of standalone energy storage capacity, Chile has 54MW in operation and 1MW in the construction phase, according to data from local renewables and storage chamber Acera. Regarding systems incorporated into renewables plants 417MW is operating, 401MW is in the testing phase and 1.42GW is under construction.

10 biggest renewables-storage hybrid projects in environmental review phase  (CREDIT: BNamericas)

9 biggest standalone storage projects in environmental review phase (CREDIT: BNamericas)

Projects involving more than 9.0GW/32,000MWh of capacity have secured grid connection approval and around 30GW was under review, according to a presentation by grid coordinator CEN given earlier this half.

A risk seen by the industry is that the market becomes flooded, creating distortions.

Permitting, particularly for larger projects, is also another challenge. 

To help ease progress for some battery projects, the government is preparing a rule tweak that would mean those with associated power lines less than 2km or under 23kV in capacity would not need to enter the environmental review system.

The full set of data can be downloaded from the box at the top of the page