Chile is by far South America’s most stable economy. As a growing economy, the country requires electricityA form of energy having magnetic, radiant and chemical effects. Electric current is created by a flow of electrons. to powerUseful energy can be mechanical energy, for example powering a fan. GDP growth, however Chile has been facing energyThe ability to perform work, mainly kinetic, potential, thermal energy, but also in forms of gravitational, sound, elastic and electromagnetic energy. supply problems since 2004 when Argentina began reducing natural gas supplies. Argentina’s cuts in natural gas (typically during the winter months of June, July and August) have a direct impact on electricity production. The country produces electricity via natural gas power plants and hydroelectric power plantsHydropower plants derive energy from the force of moving water and harness this energy for useful purposes. Traditional uses include watermills. In modern technology, hydropwer moves turbines that pass on their energy to a generator which then produces electric power. Hydropower is a type of ... (Italian utility Endesa is currently Chile’s largest energy producer).

Chile - ©istockphoto.com

During the Chilean winter of 2007, shortages of natural gas forced electricty generators to shift over to diesel. In 2007, diesel demand in Chile was about 1.2 million cubic meters per month, up sharply from about 500,000 cubic meters per month in 2006. State oil company ENAP produces about 350,000 cubic meters per month of diesel, meaning it has to import the remainder.

To make matters worse, droughts in 2007 and 2008 reduced reservoir levels at hydroelectric plants, further lowering electricity output. This caused the government to extend daylight savings time by 2 weeks in order to provide more natural light to households as an energy conservationAll the measures taken to lower the level of energy consumption. method.

Chile has been facing an energy security problem for the last three years. The country currently produces only 2.4% of their energy from renewable sources (hydroHydro power is electrical energy produced through the power of moving water.
Power obtained from the (typically gravitational) movement of water.) and the country only has one operating wind farmA group of wind turbines interconnected to a common power provider system through a system of transformers, distribution lines, and (usually) one substation. Operation, control, and maintenance functions are often centralized through a network of computerized monitoring systems, supplemented by ... (20MW owned by Endesa).

The country’s initial response to the energy crisis was to announce the development of a second liquid natural gas (LNG) reception port in Quintero at a cost of $1.2 billion. Chile also enacted renewable energyRenewable energy is power generated from infinite sources, such as wind or solar power. Conventional energy is generated from finite sources, such as natural gas or fossil oil. legislation in March 2008, requiring utilities to invest and produce electricity from non-conventional energyRenewable energy is power generated from infinite sources, such as wind or solar power. Conventional energy is generated from finite sources, such as natural gas or fossil oil. sources (renewablesRenewable energy is power generated from infinite sources, such as wind or solar power. Conventional energy is generated from finite sources, such as natural gas or fossil oil.). Currently there are no support subsidies, only a target of 5% by 2010 racheting up by 0.5% each year to 10% by 2020.

Meanwhile, Codelco, the country’s largest copper company, decided to take matters into their own hands holding a tender for the construction of a 20MW wind farm at their Gabriela Mistral mine. The project was awarded to the UK’s Seawind who have since ordered ten 2MW turbinesA turbine transforms kinetic energy into mechanical energy and provides the generator with rotation. from US wind turbineA wind turbine is a rotary engine that extracts energy from the flow of wind. The simplest turbines have one moving part, a rotor assembly, which is a shaft with blades attached. Wind energy acts on the blades, or the blades react to wind, so that they rotate and impart energy to the rotor. ... company DeWind.

Seawind state they are developing between 250-450MW of windWind occurs due to different temperature levels in the atmosphere (troposphere) which are heated up by the sun. A typical example are the trade winds at the equator where the sun is most powerful.. (based on press announcements by the company). Northern Chile’s region II environmental regulator Corema approved the EIA submitted for the 100MW Quillagua wind farm to be developed in Tocopill. And last month Seawind stated they are currently seeking a financial partner to assist them with 1.2GW of wind development in the country.

Since enactment of the renewable energy targets, wind powerWind power is the conversion of wind energy into a useful form, such as electricity, using wind turbines. By 2010, a single wind turbine can produce several MW of electric power. has accelerated in Chile’s Region IV, where a handful of companies have disclosed plans to build wind parksA group of wind turbines interconnected to a common power provider system through a system of transformers, distribution lines, and (usually) one substation. Operation, control, and maintenance functions are often centralized through a network of computerized monitoring systems, supplemented by .... The region is currently home to the country’s largest wind farm (20MW), Parque Monte Redondo. French utility SUEZ announced in March 2008 that they were investigating two thermoelectric plants and some wind. In July Spain’s Grupo Enhol announced 500MW of wind in conjunction with Chilean developer Haciendas Talinay.

However, it appears that Chile’s next wind farm (to be the country’s largest) will be built by the Norwegians. At the end of 2008, Norwegian developer SN Power announced 46MW in the region of Coquimbo. The Totoral Wind Farm received a $61.5 million project finance commitment from the IFC in March, making it the first ever project financed wind farm in Chile. The project developer is Norvind S.A., a special-purpose vehicle set up by the project sponsors, Statkraft Norfund Power Invest A.S, the Norwegian power developer, and its Chilean partner, Centinela.

It’s incredible what a bit of legislation can do for a country’s renewables market. Chile’s National Energy Commission is predicting 100MW installed by 2010. Projects under development currently exceed more than 2,000MW. Naturally the financial crisis is affecting the ability for wind projects to access debt financing, but developers are hoping that by the time projects are fully permitted in 2-3 years, that banks will be lending again.

In November 2008, Irish developers Mainstream signed a $1 billion joint venture deal with Chilean company Anders Energy to develop wind farmsA group of wind turbines interconnected to a common power provider system through a system of transformers, distribution lines, and (usually) one substation. Operation, control, and maintenance functions are often centralized through a network of computerized monitoring systems, supplemented by .... In May 2009 , Italian utility ENEL announced that 850MW of wind was under development.

So, there seems to be no shortage of wind farms under development in Chile, although a lack of wind resource maps are stated as a barrier to even more wind farms. Moving over to solar…

Last summer the Atacama Solar Platform Initiative was established by a consortium comprised of Fundacion Chile, State mining company Codelco and several government agencies. The plan is to develop solar zones over the next three years that would include both the manufacturing of solar panelsRegarding photovoltaic or solar panels with crystalline cells, the photoactive layer consists of serial and/or parallel interconnected solar cells which are embedded into two plastic films. A front glass protects the interior for mechanical damage. Regarding thin-film solar modules the ... and the construction of solar power plantsA photovoltaic plant is a power station that generates electrical power by using photovoltaic cells; usually such a power plant feeds electricity into the public grid.
Grid-connected photovoltaic systems are connected to the public grid through an inverter and feed-in electricity into the ....

In June 2008 Chilean president Michelle Bachelet and California governor Arnold Schwarzenegger signed a pact to “promote active collaboration in alternative energyRenewable energy is power generated from infinite sources, such as wind or solar power. Conventional energy is generated from finite sources, such as natural gas or fossil oil., higher education and innovation.” That month also saw the launch of Sistemas Automáticas, a consortium of 30 companies, who announced plans to submit an Environmental Impact Assessment (EIA) for the Atacama DesertA wide, open, comparatively barren tract of land with few forms of life and little rainfall. (MGH)’s first major solar energySolar energy is the light and radiant heat from the Sun that influences Earth's climate and weather and sustains life. For solar energy as a source for renewable energy, look up photovoltaics (solar power) or solar thermal energy. farm, Ícaro. Work on the project is expected to begin sometime in 2009.

In December 2008, Korean group Daekyeonsolar stated they would invest $1.3 billion for a 150MW solar farm in the Atacama Desert. An environmental permit for the project was submitted for approval in February. The first 10 MW of the Sun Rice project is expected to be built by the end of October and will require an estimated $90 million, including 600 hectares of land.

Daekyeonsolar is a private company focused on the production, distributionThe delivery of electricity to the retail customer's home or business through low voltage distribution lines. and installation of photovoltaic cellsA solar cell transforms sunlight directly into electrical energy.
A solar cell or photovoltaic cell is a wide area electronic device that converts solar energy into electricity by the photovoltaic effect. Photovoltaics is the field of technology and research related to the application of .... It currently has presence in Nigeria and Thailand, where several 30MW projects are already in operation.

Finally, a high profile group of investors (including Al Gore) are working on the Andean Solar 200 MW solar and wind project in the Chilean region of Antofagasta. The stated goal is to become “the first self-sustainable, financially viable plant without any kind of government subsidies.” The project wants to generate enough energy to provide electricity to three mining towns in Escondida (the largest private copper producer in the country), Chuquicamata (Codelco) y El Abra (Codelco and Freeport McMoran).

In 2005, Chile joined REEEP (Renewable Energy and Energy EfficiencyUsing less energy/electricity to perform the same function. Programs designed to use electricity more efficiently - doing the same with less. Partnership) and at the end of 2008 they joined IRENAMandated by governments worldwide, IRENA's (International Renewable Energy Agency) mission is to promote the widespread and increased adoption and sustainable use of all forms of renewable energy. IRENA's Member States pledge to advance renewables in their own national policies and programs, and ... (International Renewable Energy AgencyMandated by governments worldwide, IRENA's (International Renewable Energy Agency) mission is to promote the widespread and increased adoption and sustainable use of all forms of renewable energy. IRENA's Member States pledge to advance renewables in their own national policies and programs, and ...).  Germany pledged $126 million to fund Chilean research into renewable energy and energy efficiency, with Chile receiving a donation of $11.5 million for renewables research in remote areas of the country with the balance to be provided as a loan.