In 1982, Fundación Chile created Salmones Antártica, starting with the high-scale salmon farming in our country. This company was subsequently purchased by Japanese investors in 1988, allowing the private sector becoming a driving force for the industry. In 31 years, this industry grew and reached US$ 3,500 million in exports in 2013, almost twice of what the wine industry exported the same year, almost the same the fresh fruit market did, and more than three times of what Argentina exported in beef.
After 28 years, Fundación Chile created along a group of private investors Solar Chile, with the dream of building in our country the first competitive and un-subsidized solar plant in our country. In 2012, this company was acquired by First Solar, the largest solar energy company in the world, measured by market capitalization, thus thrusting our goals forward.
In June 2014, President Obama announced that OPIC (Overseas Private Investment Corporation) would be funding the Luz del Norte (Northern Light) Project, located in the vicinity of Copiapó. Luz del Norte will be the first merchant solar energy plant (i.e. that injects the spot market), and the largest competitive of the world and without subsidies of any type. Luz del Norte is a Project carried out by Solar Chile, firstly, launched by the founding partners of this venture and, later, impelled by the strength and experience of First Solar. Just like Salmones Antártica was, the success of Solar Chile represents a big milestone for the development of solar energy all over the world, and, for our country, the beginning of a path that will have much larger potential than the one reached by the salmon industry.
Chile has outstanding conditions for the development of solar energy. Our Atacama Desert has the highest solar radiation of the planet; a solar panel placed in Atacama generates 45% more energy than the same panel placed in Seville, one of the most important solar energy poles in the world. Not only we have the highest solar radiation, virtuously, the high radiation is combined with the fact the Atacama Desert is cold compared with other high radiation areas such as the Mojave Desert or the Middle East. This improves the efficiency of the panels located in Chile given high temperatures undermine panels efficiency. These “endemic” conditions of our country, are combined with good land availability (albeit there are in this context a series of administrative and legal hurdles to improve), high costs of alternative energy, very high carbonization of the matrix in the great north area, and most importantly still, the presence of electric demand near the source (i.e. mining). Additionally, the costs and efficiency of photovoltaic technology has improved exponentially in the last years, and it is expected to keep growing in the future. The accuracy of this opportunity made Fundación Chile explore diverse forms to seize it more than eight years ago. Among the diverse options generated, one was the creation of Solar Chile, head of strategic moves, but supported by a group of enabling initiatives that paved the road for it.
In short, the possibilities of solar energy in our country are enormous, pushed forward by three vectors that converge virtuously: unparalleled natural conditions (radiation and lands), growing demand near the source (mining industry), and technology at competitive prices (photovoltaic panels). Therefore, what is the potential?
The road that opens up with the Luz del Norte plant is very promising. It allows the country an early start into the learning curve –leading globally – with no cost for the State, which will enable it to capitalize the advances made in the technology field.
Let us focus on the vector of technological advance. The photovoltaic technology follows the same road as Information Technologies. To illustrate this, the cost of the world’s most powerful computer in 1975 was US$ 5 million. In 2013, an iphone 4 had the same power as that computer, but its cost was only US$ 400. The cost of one photovoltaic watt decreased 80% from 2000 to 2013 (and it is currently decreasing). In addition, storage technologies will keep improving (lithium batteries, hydrogen production, using energy generated by the sun, pumped storage). If we observe how the salmon industry grew in 31 years, can you imagine where Chile will be in solar energy matters in the same time period? This takes us to look beyond (electric) energy contingency that the country lives nowadays. In fact, if we take in consideration the advances in storage technologies, the potential is extended beyond the US$ 6.5 million of the national electric sector, covering also the US$ 5.5 thousand million of the market of transportation fuel. The former is just thinking in our national market.
Let us focus on the vector of the natural conditions. With 0.3% of the public lands in Atacama Desert, we could generate all the energy Chile consumes in a year. This energy comes from and endemic Chilean resource, that diminishes the dependence on importing fossil fuels besides making more predictable the generation and cost of our matrix. Then, why can we not turn ourselves not only in an energetically independent country, but also a net energy exporter?
The two aforementioned vectors are activated by the force of energy demand that our country will face in the future: not only more, but also better. Better, from the point of view of costs, of respect for the environment, safety, and predictability.
These three forces are combined powerfully today in Luz del Norte, just as in the case of salmons. Our country gets in a timely manner into a wave that will open great options in development for the future. Congratulations.