Engie to Develop 2 GW Renewable Energy in Chile by 2025

French multinational electric utility company Engie recently presented a comprehensive plan at the Presidential Palace of Chile for its operations in the country, including the development of 2 GW of renewable energy capacity and the end of its 1.5 GW of coal-fired power generation activities by 2025, both of which are part of the firm’s ambition to achieve carbon neutrality latest by 2050.

The President of Chile, Sebastian Piñera, sat down with Engie CEO Catherine MacGregor for an online meeting, post which the Group reiterated its intention of shutting down six units of 800 MW of coal capacity, including two facilities already closed in 2019, by 2025. Additionally, three new units of 700 MW would be converted to gas or biomass within the same deadline.

The firm’s new renewables deployment target is double the previous target of 1 GW renewable energy set for the year 2025. Of these, around 600 MW of clean energy projects are already underway in Chile, which had awarded Engie the development rights in the country’s solar auction, allocating 2.6 GW of capacity, held in 2020.

These projects, which will have absorbed investments worth EUR 1.5 billion by 2025, will help the company cut down 80% of CO2 emissions from its energy production activities in Chile by 2026. In addition to the above, the firm is also committed towards developing green hydrogen production in Chile, conforming to the nation’s decarbonisation strategy of producing the world’s cheapest green hydrogen by 2030 and having 5GW of electrolysis capacity under development by 2025. President Piñera has even spoken previously of the country’s potential to export the fuel. Engie considers itself a pioneer in hydrogen development, as evidenced by the fact that it has developed three pilot projects in the country: HyEx, in collaboration with Enaex to develop green ammonia; Hydra, to promote truck mobility in the mining sector; and an initiative with Walmart that will involve the use of 149 cranes powered by green hydrogen. The company’s expanding growth in the country follows its commissioning of 3 GW of new renewables globally in 2020, which is likely to help meet the target of increasing its clean energy capacity by 9 GW between 2019 and 2021.

MacGregor said, “We are committed to taking action to accelerate the transition to carbon neutrality. Our collaboration with the Chilean government puts us at the forefront of supporting the country’s decarbonization. The total exit from coal and the promotion of renewable energies, including green hydrogen, demonstrate our commitment to contribute to Chile’s sustainable development.”

Recently, Chile won the first position in research organisation Bloomberg’s annual survey of the energy transition in developing countries, BloombergNEF’s 2020 Climatescope, due its renewable energy-friendly policies which aim to increase clean energy’s stake in power production to 60% by 2035, and phase out coal-fired plants. Next month, the country will hold another renewables auction and the winning projects will have to sign 15-year power purchase agreements and begin supplying electricity 2026 onwards.