Chile explores green hydrogen investments in Europe

Kurka told AFP that Chile could achieve carbon neutrality by 2040 “if we have the resources”. This is 10 years ahead of the global net zero target set by the Paris Climate Agreement.

Speaking on the sidelines of the Hyvolution Energy trade show in Paris this month, Kurka said 24% of Chile’s emissions reductions will come from hydrogen and its derivatives.

Hydrogen, which emits only water vapor when consumed, is being touted for its potential use in highly polluting heavy industries such as steel, metals, cement, and chemicals, as well as in shipping.

However, costs remain high and infrastructure is currently lacking, making mass production a major challenge.

It is considered a “green” fuel if it is produced by splitting water molecules using electricity generated by renewable energy.

Hydrogen can also be produced through a more controversial method using natural gas, so-called “blue hydrogen.” To be considered climate-friendly, it must be combined with carbon capture equipment.

Last month, the International Energy Agency announced that only 7% of the projects announced to use renewable energy to produce hydrogen around the world in the past decade are expected to be operational by 2030.

But Mr Kurka said Chile “could become the cheapest hydrogen producer in the world”.

The country plans to close its coal-fired power plants and replace them with renewable energy sources by 2040, with the plants themselves set to be used to produce green hydrogen.

Chile is the world’s largest exporter of copper, a metal critical to the energy transition because it conducts electricity.

However, because mines rely on fossil fuels to operate, they are also emitters of greenhouse gases.

Mr Kurka said reducing copper’s carbon footprint could rely on solar power near copper mining areas in the north and wind power in the south.

He said Chile needs $60 billion in investments by 2050 for its green hydrogen program.

The low cost of renewable energy is attracting interest from Austrian Energy, French energy giant Engie, Total Energy and EDF, as well as companies from Germany, the Netherlands and Norway who want to import green hydrogen into Europe.

But for now, Chile has only 2 megawatts of installed green hydrogen capacity, with a goal of reaching 25 gigawatts by 2030, Kurka said.

According to the Hydrogen Council, the current global installed capacity is 1.1 GW.

Christian Segal, a Chilean diplomat and French investment commissioner, echoed the warnings of climate change activists that hydrogen alone is not enough for the energy transition.

He said it would be “irresponsible to say that green hydrogen can avoid climate-related disasters” such as the fires that have killed more than 130 people in Chile in recent weeks.

Chile’s green hydrogen plan is just “one possible answer” to “decarbonize[the country’s]economy and contribute to much-needed global emissions reductions”.

But Kurka argued that hydrogen is needed to reduce emissions from heavy mining trucks, explosives used in mines, shipping and the chemical industry.

He said 64 industrial projects related to green hydrogen have been announced, with a total investment of nearly $5 billion by 2025.

Chile plans to produce between 1 million and 3 million tons of hydrogen over the next six years.

Chile is overhauling its port infrastructure, converting oil and gas facilities currently used for imports to allow exports of ammonia, which can be converted into hydrogen.

“We are moving quickly. There is a lot of infrastructure to build,” Gloria Maldonado, director of Chile’s state oil company ENAP, told AFP.

As Chile negotiates with the EU, 100 human rights and environmental organizations have issued a joint statement warning EU lawmakers against signing new trade and investment deals.

Mathilde Dupré, co-director of the Veblen Research Group, which signed the document, said the document was “strategic for the EU to access Chilean raw materials, but must not be implemented at all costs.” .

Regarding the obligation to respect human and social rights in Chile and the environment of the country, he said: “This project offers very favorable standards of protection without imposing any burden on foreign investors.”