Chiles National Green Hydrogen Strategy

Solar power plant
This solar plant in the Atacama Desert generates clean electricity for the production of green hydrogen. Photo: GIZ

At the end of 2020, Chile announced its ambitious national strategy for green hydrogen, which was developed with the support of IKI.

In November 2020 President Sebastián Piñera and the Minister of Energy, Juan Carlos Jobet, announced the ambitious National Green Hydrogen Strategy, which will allow the development of a green hydrogen industry in the country.

A starting signal for ambitious goals, which are also laid down in Chile's NDCs. Chile's national green hydrogen strategy has three main objectives: to have five gigawatt of electrolysis capacity under development by 2025, to produce the most cost-efficient green hydrogen by 2030, and to be among the top three exporters by 2040.

To achieve these objectives, an action plan in order to create regulatory and normative framework, determine the local and international demand, create financial and fiscal incentives and suport local development, has been developed to accelerate the deployment of the national green hydrogen industry until 2025 and to be able to export green hydrogen and its derivatives from 2030 onwards.

In parallel, an operational task-force will establish transparent permitting procedures and develop pilot projects for green hydrogen and its derivatives. Minister Jobet details that "we will also create another task force to position Chile at an international level and form three international consortia in Chile for electrolysis capacities of at least one gigawatt each".

Green hydrogen value chain graphic

To increase the demand for this clean fuel, quota mechanisms will be explored for use in gas networks, an approach similar to that successfully applied earlier to foster renewable energies. In addition, a working group will be set up with companies to accelerate the use of green hydrogen in industry processes. It is intended that the hydrogen industry will be considered in political decisions on spatial planning and development, in particular in relation to the necessary infrastructure.

The Ministry of Energy seeks to resolve critical barriers and will establish the necessary safety standards to ensure planning certainty for the local and international investors which are presently developing green hydrogen projects.  More than five large scale projects for the prodution of green hydrogen and/or its derivates, some to satisfy the local demand, other for export, are already under development in Chile.

Other key actions contemplated in the strategy are capacity building and knowledge transfer to meet the workforce and labour needs that this new industry will demand. It also provides for the involvement of local communities and stakeholders to ensure early and ongoing participation. This aims to increase the value that can be captured by local suppliers.

All activities regarding the devolpment of a green hydrogen economy in Chile are suported by IKI project “Decarbonisation of Chilien Energy Sector”, implemented by the Gesellschaft für internationale Zusammenarbeit (GIZ) since 2014.

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