Chile offers $30mn to support green H2 projects

Chile's government opened a tender for $30mn in funding to accelerate the development of green hydrogen projects.

Foreign and domestic participants vying for the funds must present pilot projects derived from at least 10MW of electrolysis that would start operating by December 2025. The renewable energy for the projects can be self-generated or injected from the national grid.

The financing will be awarded to one or more projects, Chile's development agency Corfo said.

Corfo will hold a period of consultations on the tender through July, followed by a September deadline for proposals.

Green hydrogen is hydrogen derived from using renewable energy sources, usually solar or wind. The energy is used to generate electrolysis to separate the hydrogen from oxygen in water. The hydrogen is then used as a clean-burning fuel.

Among the projects that will compete for the funds is HyEx, a green ammonia project spearheaded by France's Engie and Chilean explosives manufacturer Enaex. Engie is also working on a project to replace conventional diesel in heavy mining trucks in Chile's northern copper patch, in a project dubbed Hydra.

In the deep southern Magallanes region, local developer AME is leading a project to develop green methanol and e-fuels on the site of state-owned Enap's modest oil and gas installations.

Green hydrogen is a pillar of Chile's 2050 carbon neutrality goal. By that long-term target, the emerging hydrogen industry could generate $24bn in exports plus $9bn in the domestic market, rivaling the country's $30bn-40bn copper sector, the government says.

The government is currently drafting green hydrogen regulations with an eye toward becoming the world's lowest-cost producer.

Elsewhere in Latin America, Brazil is also starting to draft a regulatory framework for future green hydrogen projects.

By Patricia Garip