Green hydrogen

Chile set for first industrial-scale green hydrogen pilot plant in 2022.

Chile will have its first industrial-scale pilot plant for green hydrogen production, in Cabo Negro, Punta Arenas, by the second quarter of 2022. The plant, named Hari Oni, operated by the Highly Innovative Fuels consortium will produce carbon neutral fuels with a 3.4 MW turbine generating green hydrogen from water. Siemens Energy, Porsche, Enel GreenPower, ExxonMobil, Enap and Empresas Gasco will participate in the project.

“This is a very important project for Chile,” remarked an engineering professor at the Instituto de Ingenieros de Minas de Chile, “the estimates from the Ministry of Energy show that Chile could produce 13% of global green hydrogen! The USD 51 million investment in the project will also help the region of Magallanes, it’s already under construction and should be fully operational in 2022.”

“This is a very important project for Chile, the estimates from the Ministry of Energy show that Chile could produce 13% of global green hydrogen!”

Engineering professor at the Instituto de Ingenieros de Minas de Chile

The ground-breaking project will also be a centre for research, development and implementation of new technologies which could be expanded to other countries in the region. Mexico, Uruguay, Argentina and Cosa Rica have also been working on the development of similar plants over the last few years. Thus, Latin America has the capacity to become a global contributor to the production of low-carbon hydrogen if private investors back the region’s abundant renewable energy assets to produce green fuels. The professor warned, “It’s not difficult to imagine how the project could be replicated in other parts of Latin America, but geographical conditions are important as the plant requires strong winds, but there are plenty of places like that in Latin America.”

An energy developer in Chile was already looking to the future, “Chile benefits from strong winds and a skilled workforce but as the cost of renewables declines the geographic advantage will be lost and many neighbouring countries will be able to produce green hydrogen, such as Argentina and Bolivia. The main advantage of Chile over these countries is its institutional framework, an area which unfortunately presents risks.”

“Chile benefits from strong winds and a skilled workforce but as the cost of renewables declines the geographic advantage will be lost.”

Energy developer, Chile

In this context, the main challenge for the promotion of hydrogen production in Latin America is for policy-makers to design adapted measures to support the application of sustainable technologies as they reach the market. Additionally, carbon pricing policies can also be effective in supporting the long-term development and deployment of hydrogen production plants. An executive of a multinational energy company in Chile agreed, “Regulation presents a significant challenge and risk for all future energy projects. Chile is becoming a ‘bureaucratic obstacle course’ for the approval of permits for projects of all kinds. Furthermore, the redrafting of the Constitution could affect the possibilities for private participation in such strategic sectors.”

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