Chile awards electrolyzer production grants, partnering with suppliers among next steps

Chile's state development agency Corfo awarded grants totaling US$25.6mn for three local electrolyzer production projects.

The winning parties are from China, Spain and Chile, with overall investment in the plants estimated at more than US$50mn. 

The initiative is part of efforts to help build green hydrogen value chains and local know-how. Producing them in Chile would also help reduce logistics costs associated with shipping finished units. Ten parties had participated in the call.

During the first year of the contracts, work involves conducting studies, securing land and forming partnerships with local suppliers and providers, BNamericas has learned.   

Second-year work includes submitting electrolyzer specifications with the goal of building unit production capacity starting 2026.

Chile has around 70 publicly announced green hydrogen projects involving multiple gigawatts of electrolyzer capacity, some targeting the export market, some domestic offtakers, others both. The bulk, by capacity, are in Antofagasta and Magallanes regions, with Biobío region seen presenting opportunities given potential local industrial offtakers and existing midstream infrastructure. 

"The goal is to meet, in a narrower timeframe, the demand of new production plants of different scales that will be built in the country in the medium and long term; and in addition, it includes having qualified personnel for electrolyzer maintenance in the country," Corfo executive VP José Miguel Benavente said in a release.

"What makes this announcement so relevant is that it will allow Chile to play an important role in a top-tier engineering manufacturing area, generating local linkages associated with the green hydrogen industry. We are talking about high value-added production on Chilean soil, and that doesn't happen as frequently as we would like."

Chile sees green hydrogen playing a role in decarbonization efforts and derivative products e-fuels and green ammonia in particular as new export opportunities. 

Key challenges facing the nascent industry, developing slower than originally forecast, surround getting projects permitted, driving down the cost of production and securing offtakers. 

The winners

China's Beijing SinoHyEnergy put forward project Hygreen BioBío H2v, planned for Biobío region. Partners are Biobío industrial players Constructora Manuel Enríquez Talcahuano and Conmetal. The proposal involves assembling alkaline electrolyzers of 2.5-5MW in capacity. Structural components would be built locally and critical, or specialized, parts such as membranes and electronics imported. Behind the project is China's Hygreen Energy, the third biggest manufacturer of electrolyzers in the world.

Spanish consortium JoltechSolutions was the other foreign player to secure a subsidy. JoltechSolutions proposes assembling electrolyzers with capacity of between 100kW and 1MW in Biobío, in conjunction with Universidad de Concepción and Enertex Ingeniería y Desarrollo de Proyectos. The proposal includes the local manufacturing of alkaline electrodes and other components. 

Meanwhile Chile’s Fastpack has partnered with Mining3 Chile, L&A Ingeniería y Proyectos, Universidad Adolfo Ibáñez and the Brazilian unit of Chinese hydrogen value chain player GuofuHee. Their project, planned for Santiago's metropolitan region, involves assembly of alkaline electrolyzers of 100kW-1MW and PEM electrolyzers of 50kW-1MW, as well as local manufacturing of auxiliary systems. The project is branded Hypack Chile: Chilean electrolyzer assembly plant.