Key takeaways from Chile’s biggest annual solar power event

Regulations, territorial planning and energy storage were among the topics explored during Proyecta Solar 2023, Chile’s biggest annual solar power conference.

Chile has a goal of achieving carbon neutrality by 2050 and rapid deployment of renewables over the past decade has helped propel the country out of the starting gates. Nevertheless, there are multiple challenges – but also opportunities – on the road to net zero.      

Proyecta Solar was hosted by sector chamber Acesol. Along with short-term measures to mitigate the impact of dispatch congestion on generators and for a robust grid, Acesol cited the need for a modernization of distribution sector rules and called for a public-private working group to develop regulations in the sphere of distributed solar thermal generation.

Grid congestion fallout, which is impacting the finances of some renewables-only generators, in turn raising questions about possible M&As and impact on access to financing, was discussed but not a central topic. Various associated areas are addressed in a government energy transition agenda published recently.

Distribution sector reform and investment, meanwhile, are deemed necessary to help prepare the country for growth in the likes of electric vehicles and homes with solar installations that can inject power back into the grid.

SOLAR THERMAL

In terms of solar thermal, Acesol is calling for regulations that help spur penetration. The initial focus is rules geared to the residential segment, followed by industry.

Just over 20% of energy consumption in Chile corresponds to electricity, indicating the space for growth in electrification and also the need for the requisite regulations and investment to support this.   

Commercial operations that use hot water and heating, such as winemaking and greenhouse farming, are ripe for on-site solar thermal installations, delegates heard. In this space, tasks include liaising with companies and establishing their individual requirements, said Roxana Silva, chair of Chile’s association of energy efficiency firms Anesco. Regulation and market entry barriers were also underscored. Energy ministry coordinator Andrés Véliz said a central objective was ensuring robust installation rules are in place.

In the residential segment in Chile, particularly south of capital Santiago, wood is a widely used energy source.

Other highlights of the event:

– Energy minister Diego Pardow acknowledged structural power market reforms were needed but underscored the importance of paving the way by implementing smaller but nonetheless important rule changes in the meantime. Pardow cited as an example a bill being drafted that hands back to transmission firms responsibility for tendering processes corresponding to projects that expand existing grid infrastructure.  

– Renewables sector players are calling for transmission infrastructure to help ease congestion, while energy storage is seen as a way to reduce fallout faster. More transmission, however, was not a panacea, a sector official told the conference.

– Sara Larraín, director of NGO Chile Sustentable, an important figure in Chilean clean energy policy development and a former presidential candidate, argued that public-private collaboration and territorial planning are vital to support continued decarbonization. Citing the examples of a large clean energy plant or green hydrogen complex earmarked for a particular zone and its potential community impact, Larraín said it was critical to “maintain the legitimacy of renewables.” 

– During a discussion on solar power’s role in the energy transition, transmission association executive director Javier Tapia cited a need for better planning, investment in lines and storage, and action to tackle permitting bottlenecks, the latter a widely cited hurdle. 

– Francesca Milani, president of Chile’s association of nonregulated power consumers Acenor, called for more efficient use of existing grid infrastructure and for construction of generation plants close to where the power is actually consumed. Acenor is also exploring opportunities in the self-supply segment, the conference was told.  

– A grid infrastructure player – traditionally focused on power inverters – is diversifying into utility-scale energy storage systems.   

– Given the current injection duration of typical battery energy storage systems of around five hours, and the scope for obtaining favorable spot prices during non-solar hours, the segment focus may widen to include more projects that can pump power into networks for longer. Draft power supply auction rules, recently published, include incentives for energy storage projects. The power industry is awaiting secondary legislation that will guide the implementation of a 2022 law that opens the door for standalone storage systems.