COP-bound Chile promotes green brand

Chile is dispatching a potent delegation to the COP26 meeting in Scotland next week, reinforcing its vanguard climate role in Latin America.

As a renewable energy powerhouse and a strategic minerals producer, Chile is forging a green brand to ensure that its export-oriented economy stays competitive abroad.

In a presentation today, the environment ministry issued a long-term climate strategy featuring sector-based emissions reduction targets to reach a 2050 carbon neutrality goal. The transport and energy sector account for the bulk of the carbon budget, with 29pc and 26pc, respectively, followed by mining, agriculture and others.

Among the strategy's pillars is climate change legislation recently passed by the senate that is designed as a framework for regulations. To finance the long-term plan, Chile will utilize sovereign green bonds, an increased carbon tax, a revised donations law, support from state development agency Corfo and a new Chilean nature fund. A national carbon market is slated to kick off in 2023.

Environment minister Carolina Schmidt will attend COP26 along with energy and mining minister Juan Carlos Jobet and science and technology minister Andrés Couve.

Jobet's portfolio figures large in Chile's climate drive. In June 2019, the country's main power generators agreed to phase out coal-fired capacity — a plan that was later accelerated but briefly set back this past winter because of a severe drought that eroded seasonal hydroelectric supply.

In late 2020, the ministry launched a green hydrogen strategy designed to leverage Chile's abundant renewable energy capacity. Since then, scores of green hydrogen projects have cropped up, encompassing a range of sectors including mining, fertilizers and gas distribution. In the deep southern Magallanes region, Chilean firm AME is currently building a pilot project to produce green hydrogen and convert it into methanol and renewable fuels like gasoline and LPG. Ten other projects are currently vying for $50mn in green hydrogen funds that Corfo will award in December.

Solar and wind energy already account for a combined 26pc of Chile's 26.5GW national power grid (SEN), and more is on the way , including 3,300MW of solar and 946MW of wind farms currently under construction, according to the National Energy Commission.

More recently the energy ministry introduced a draft long-term national energy strategy and, together with the transport ministry, launched a campaign to phase out internal combustion engine cars by 2035.

"This is not only the most important responsibility for future generations but also an enormous opportunity to clean up our productive identity, transform it, to make our economy more competitive in a world that is increasingly sensitive to the carbon footprints of the products it consumes," Jobet said at today's event.

Chile or bust He pledged that Chile would continue to produce climate-critical minerals but with cleaner processes. "Without Chilean mining, the world can't stop climate change, it's as simple as that," he said, noting that 30pc of the world's copper and 20pc of lithium comes from Chile. The minerals are used to make electric cars and batteries.

The embattled center-right administration of President Sebastian Piñera, who leaves office in March 2022, is pressing to ensure that its climate policies are cemented as state initiatives that will endure regardless of the next government's political stripes.

Chileans go to the polls on 21 November to elect a new president and members of congress. In an echo of polarized elections around the world, the two frontrunners, Gabriel Boric and Jose Antonio Kast, represent political extremes, departing from the country's three-decade-old moderate political tradition.

By Patricia Garip

Related News