Engie to develop 2GW renewable energy portfolio in Chile by 2025


Engie currently has 600MW of renewables under construction in Chile. Image: Engie.

Engie has doubled its renewables deployment targets in Chile as part of plans to end its coal-fired generation activities in the country by 2025.

With 600MW of clean energy projects already under construction in the country, the French utility said it will develop a total of 2GW renewables by 2025, double its previous target of 1GW. The company was among the winners of development rights in Chile’s solar auction last year, which allocated 2.6GW of capacity.

Following a virtual meeting between Chilean President Sebastian Piñera and Engie CEO Catherine MacGregor, the company said it is closing six coal units with a combined capacity of 800MW and converting three coal plants (totalling 700MW) to gas or biomass.

The plan involves an investment of €1.5 billion (US$1.82 billion), enabling the company to reduce CO2 emissions by 80% from its energy production activities in Chile by 2026, as it aims to achieve global carbon neutrality by 2050.

MacGregor said the firm’s collaboration with the Chilean government puts it “at the forefront” of supporting the country’s decarbonisation: “The total exit from coal and the promotion of renewable energies, including green hydrogen, demonstrate our commitment to contribute to Chile’s sustainable development.”

Chile’s is aiming to produce the world’s cheapest green hydrogen by 2030 and have 5GW of electrolysis capacity under development by 2025, with Piñera previously touting the country’s potential to export the fuel.

Engie has developed three green hydrogen pilot projects in Chile: HyEx, 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.

Chile’s favourable renewables policies, including a target of increasing its share of clean energy to at least 60% by 2035, and commitment to phasing out coal generation saw it claim the top spot in BloombergNEF’s 2020 Climatescope – the research organisation’s annual survey of the energy transition in developing countries.

Another renewables auction is set to take place in Chile next month, with selected projects required to start delivering power from 2026 and sign up to 15-year power purchase agreements.

Engie’s growth in Chile comes after it commissioned 3GW of new renewables globally last year, putting it on track to meet its target of adding 9GW of clean energy capacity between 2019 and 2021. The company last week announced the sale of a majority stake in stationary storage and e-mobility solutions company Engie EPS as part of efforts to simplify its operations.

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