Analysis of the incorporation of Non-Conventional Renewable Energies to the national energy matrix.

Hugh Rudnick, UC academic and director of the consulting firm Systep: “Today we have an overinvestment in renewable energies”.

In 2013, Law 20/25 was enacted, doubling the goal of an energy matrix from non-conventional renewable sources from 10% by 2024, as stated in the previous law, to 20% by 2025. According to Hugh Rudnick, UC academic and director of the consulting firm Systep, these regulations have been more successful than one might think. “Attracted by this law and by the political and economic conditions of the country that make it an attractive market, an almost excessive number of investors have arrived and practically with the plants under construction and those that signed contracts in the last bidding process in December, we have already met the 2025 target.”

Hugh Rudnick says that there is an overinvestment in renewable energies that is noticeable, for example, in the Norte Chico, where there has been so much investment in renewables in a sector where there is a transmission problem (Third and Fourth Regions) that prices are going down. “Despite the barriers that exist in transmission, labor or financing, these energies have developed very well.”

Are these barriers surmountable?

Existing in practice, the barriers are not relevant to what has happened in the country. Even technological barriers. At some point we thought that, because solar and wind power are intermittent, it was going to be too difficult to accommodate them in a permanent load system. But even the technological mechanisms are already in place to address them. My impression is that, in practice, the barriers are not relevant.

And in the transmission system, the barriers will be overcome. For example, today we have many bottlenecks and one of them is precisely the one that connects the central zone with the Third and Fourth Regions. But the ministry and Minister Pacheco in particular have been gambling so that electric roads can be developed and to find the routes that least impact citizens and society as a whole.

In this scenario, why not set more ambitious goals?

At some point, renewable energy investors told us that Chile should be more aggressive and aim for 30/30 (30% of the energy matrix coming from renewable sources by 2030). I believe that goals should not be set because, as they have proven to be competitive, there is no point in getting too ambitious. The goal was precisely to raise the barriers to entry. Let the market respond and let renewable energies demonstrate that they can earn their place. Countries such as Germany and Spain have shown that promoting these energies beyond economic conditions can be detrimental.

Does the current scenario seem auspicious to you?

It was a good decision that in Chile we chose to set limited quotas and not subsidy tariffs, as other countries did, because that has made renewable energies have to compete and those that have managed to do so have been well inserted in the market.