Home » Chile Tipped to be ‘Most Promising’ Hydrogen Export Market by 2030
Chile Energy Global News Government News

Chile Tipped to be ‘Most Promising’ Hydrogen Export Market by 2030

Chile is emerging as the most promising hydrogen export market by 2030, according to a new Hydrogen Export Markets report.

Chile aims to have 5GW of electrolysis capacity operating and under development by 2025 and by the end of the decade, its green hydrogen production capacity should have reached 25GW.

As of February 2023, Chile was actively carrying out 41 projects focused on green hydrogen with HIF Global’s Haru Oni demonstration plant in the south of the country already in operation.

The pilot, featuring a single 3.4-MW Siemens Gamesa wind turbine and a 1.2-MW Siemens Energy electrolyser, produced the first litres of synthetic gasoline at the end of 2022, marking the beginning of fuel production using renewable energy, green hydrogen and recycled carbon dioxide. German sports car maker Porsche is the offtaker.

In the short term, the green gas will be used primarily to replace grey hydrogen and ammonia used in domestic markets but export activities are planned to begin before the decade is over. Overall, exports of green hydrogen and its derivatives from Chile are projected to total about $3bn by 2030 and grow rapidly to $16bn by 2040 and $24bn by 2050.

In the first years, exports will be focused on green ammonia. The estimated market size for Chile’s green ammonia supply abroad is $2.5bn in 2030 and $5bn in both 2040 and 2050. The main offtake destination is planned to be Europe, with prospects to account for more than half of projected revenues.

Further potential markets for Chile’s green ammonia are considered to be China, Japan and South Korea and to a lesser extent, the US and rest of Latin America.

Investments will be promoted through a $150m loan from the World Bank, approved in June 2023, which has the potential to generate investments of at least $280m.

However IRENA estimates suggest that in the long run, China is expected to surpass Chile as the green hydrogen producer with the lowest levelised cost by 2050.

While the hydrogen sector is advancing dynamically, and governments are making progress toward their ambitious goals, the countries aspiring to become top exporters must confront significant challenges.

These include the persistent absence of firm off-takers, inadequate infrastructure, and obstacles related to hydrogen transport.

“In certain regions, like the Middle East, the lack of certification and standards, alongside the absence of efficient government mechanisms and insufficient technology and skilled human capital, present further hurdles to overcome,” the report concludes.

Source : h2view