csp today guide: chile 2013

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CSP Today guide: Chile

As part of the launch of CSP Today LATAM 2013 (July 2013, Chile), CSP Today is providing you with an exclu-sive guide on the opportunities for CSP in Chile, in order to prepare your business to take maximum advantage.

CSP Today LATAM 2013 is the only event in Latin Amer-ica where the CSP industry meets the mining industry in order to collaborate on solar thermal development. Over 2 days, the conference will address the key topics to progress in the Chilean market.

CSP Today LATAM 2013 will provide you with all the rel-evant information to develop, build, finance and main-tain a CSP plant. One of the most important aspects is to promote the dialogue between mining companies and CSP developers.

Chile, July

www.csptoday.com/chile

Table of contents.1. The potential for CSP in Chile

2. CSP projects in Chile a. Minera el Tesoro b. María Elena c. Pedro de Valdivia d. Mejillones3. Interviews a. Carlos Finat, ACERA b. Diego Lizana Rojas, Collahuasi c. Rodrigo Escobar, PUCC y DICTUC d. José Manuel Ramos, Ibereólica

1st Latin America Concentrated Solar Thermal Power Conference & Exhibition

To get more information about the CSP Today LATAM conference, visit: www.csptoday.com/chile

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CSP Today LATAM 2013

Download the full guidefor free at www.csptoday.com/latam/en-content2.php

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B U S I N E S S I N T E L L I G E N C ECSP Today guide: Chile

The potential for CSP in Chile

There has been a lot of discussion about the potential for concentrated solar power in Chile. The motiving factor being that Chile is a country with high energy costs and a rapidly growing demand for energy. To continue Chile’s economic growth it has become necessary to secure energy generation from more sources and CSP is the perfect fit. The Great North region in Chile possesses one of the highest solar radiations of the world along with a strong mining industry that requires substantial energy 24 hours a day. In this guide, you will learn about the possibilities of establishing a CSP industry in Chile, get analysis on the current status of the industry as well as its demand for energy, understand recent legislative changes, and Chile’s interconnected systems..

Chile’s Energy Conundrum “Our primary sources of energy are 44 % crude oil, 10% natural gas, 17% carbon-based fuels, 8% hydroelectricity, 20% wood biomass and an additional 1% of other combustibles like biogas and renewable energy sources,” Sebastian Piñera, President of Chile.

During the Presidential election race in 2010 the current President Sebastian Piñera knew that for Chile to realize true prosperity, there was a serious energy issue needed to be resolved. Currently the majority of energy is imported, which means Chile has one of the highest costs of electricity in the world.

In 1982 Chile privatized its energy markets and has a growing demand for energy and a substantial copper mining industry. Today more than 73% of Chile’s energy comes from fossil fuels, 97% of which are imported. Also due to a high percentage of imported energy, Chile has become very vulnerable to changes in its supply chain and fluctuating energy costs.

CSP opportunities, in depth analysis

Electricity consumption by origin Electricity consumption by sector

Historic energy consumption in Chile

2010 Electricity consumption in Chile by origin and sector

Hydroelectricity 33%

Residential 16.3%

Mining 34.9%

Agriculture 2.2%

Industrial 23.9%

Others 10.4%

450

400

350

300

250

200

150

100

50

0

1978

1988

1998

1999

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Commercial 12.3%

Natural gas 23%

Coal 35%

Oil 7%Biomas 1% Wind 1%

n Biomasn Hydroelectricityn Coaln Natural gasn OilSample



exceeding 3800 kWh/m2 in the region. In addition to being a great resource of solar

energy, Northern Chile and the Atacama Desert have several characteristics which are favourable towards CSP technology, including:

�n Large and extended desert lands which are necessary for thermal solar plants, providing that these lands are not being used for other purposes such as real estate development or agriculture.�n The close proximity to energy consumption

centres.�n High demand for electricity and thermal energy,

which is currently being produced in carbon and diesel plants. The development of CSP plants for mining companies would help reduce their carbon footprint and improve the competitiveness of Chilean mines in the international market.�n The demand for a stable and constant energy

supply. Especially in the Great North where the consumption curve for big mines is steady 24/7, making CSP’s ability to store and dispatch power an ideal match for energy demands in the region.

Nevertheless, there are difficulties in developing CSP plants:

�n Despite having great stretches of land which are appropriate for CSP plants, the heat generating

projects for mining processes need to be located in close proximity to the mines. However this same land is being exploited for mining opportunities. This poses a difficult question as to where CSP plants can be located and requires extensive analysis on the cost-benefit ratio. �n Interconnection with the grid (CDIC-SING which

controls the northern region) cannot be reserved in advance and it is granted on a first come, first served basis. CSP plants generally require a longer project development process compared to that of wind and PV plants, which makes current interconnection conditions unfavourable for CSP.�n There are limited water resources therefore dry

cooling is essential for CSP plants in this area, increasing the price of electricity generated by CSP. �n As mines consume the majority of energy, CSP must

present energy costs comparable to what mining companies are paying for their current energy to make a CSP project financially feasible.

CSP Plants in Chile�n The El Tesoro Plant: This is a heat-producing plant

that Abengoa built and started operating at the end of 2012. It uses parabolic trough technology which has a potential of 14MWt and produces heat for the mining industry.�n The Pedro de Valdivia Plant: This plant being

developed by Ibereólica Group has a total capacity of 360 megawatts (MW). It has four power stages each with 90MW of parabolic trough technology and several hours of molten salt storage.�n The María Elena plant: This ambitious mega

project lead by Ibereólica Group, has a total capacity of 400MW consisting of 4 towers of concentrated overheated steam of 100 MW with 13.5 hours of storage.�n The Mejillones Plant: Little is known about this

plant since its launch by energy giant GDF Suez in partnership with the Solar Power Group. It contains a solar power field alongside a coal plant which was already owned by the developer of Mejillones. We are waiting for developments on the status of the project.

Belén GallegoFounder & DirectorCSP Today

Chile solar radiation map. Source: GeoModel SolarSample



Mejillones

Pedro de Valdivia

María Elena

Minera El Tesoro

CSP Projects in Chile

For more information have a look at the plant profiles in the next section.

Planning

Construction

Operational

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1. In terms of energy, what are the major obstacles for a mining company?The main challenge for mining companies is assuring clean, safe and reasonably-priced energy over the decades. The traditional sources of generation used in Northern Chile, has been based on coal, diesel and gas. These sources are now being strongly questioned, given that they are fossil fuels, and the gases produced is part of the Greenhouse problem and increasing global warming.

In the present environment, the use of the latest technology related to coal or to the development of non-conventional renewable energy (ERNC) is being considered as an important solution to environmental problems.

2. It is said that the mines are resistant to change, because of the problems they’ve had in the past with new energies. Why is the mining industry resistant to change and how can CSP adapt itself to the needs of the mines?When the mines experienced the gas cut years ago, imposed by Argentina, they came face-to-face with their extreme dependence on energy, which forced them to use electricity more intensively. They turned conservative because they didn’t want to have to submit to rationing and to have continuing problems with supply.

In this respect, mature technologies in developed countries such as thermal solar energy become a viable alternative because this energy can be stored during periods when there is no solar radiation.

In addition, the heat that remains in a thermal solar

plant could be utilized in mining processes which requires a high demand for heat (currently being generated by diesel and gas) similar to the process of Electrowinning, Heating and Sanitary Hot Water (also known as Domestic Hot Water) on large mining camps (which could reach 10,000 people).

3. What are the mining companies looking for with renewable energy projects and, particularly, with CSP?Mining companies are looking to see the advantages of the non-conventional renewable energies (ERNC) that conventional energies don’t have. This will be

mainly in the low production of greenhouse gases and a more favourable acceptance of using the alternative energy with the authorities and local communities.

Given this, CSP has advantages from the point of view of its capacity to store and generate heat for use in industrial processes. This makes it very attractive and can turn into an excellent energy alternative in

Diego Lizana Rojas, Head of the Energy Efficiency and Renewable Energy Unit, Compañía Minera Doña Inés de Collahuasi

Diego Lizana is a Forestry Engineer, graduated at the University of Chile and studied a Masters of Renewable Energies at the Research Center for Resources and Energy Consumption at the University of Zaragoza in Spain.

Diego started working at the Mine of Doña Inés de Collahuasi as a Specialist in Energy- Efficient Management, ERNC and Climate Change. In this role he monitored and visited important CSP plants such as Andasol 1 in Granada, Spain, PS 10 in Seville, Spain, Nevada Solar One in Nevada, USA, and research centers such as the Solar Platform in Almeria, Spain, and ENED in Freiburg, Germany. Diego also acted as Vice-President of the Energy Efficient Mesa Mining Company.

Diego’s personally believes CSP is an important alternative within the range of non-conventional renewable energies capable of stabilizing the electrical system of the Great North, particularly with storage of solar energy.

“CSP has advantages from the point of view of its capacity to store and generate heat for use in industrial processes. This makes it very attractive and can turn into an excellent energy alternative in comparison with conventional energies.”

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csp today guide: chile 2013

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