PART 2: CSP Today Guide: Chile 2013

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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/en

1st Latin America Concentrated Solar Thermal Power Conference & Exhibition

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

B U S I N E S S I N T E L L I G E N C E

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CSP Today LATAM 2013

CSP Today guide: ChilePart 2

Table of contents1. Chile launches its first CSP

tendering process

2. Interviewsn Carlos Arenas (Energy

Ministry for the North Zone) n Rodrigo Palma (SERC Chile)n Christoph Tagwerker (BID)

3. Mining, CSP and emerging markets: what is the potential?

Download the full guidefor free at www.csptoday.com/latam/en-content3.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 of CSP in Chile

The launch took place one year after the announce-ment by the president Sebastián Piñera of the Na-tional Energy Strategy Plan 2012 -2030.

Bunster said that the CSP plant “will allow us to use of natural [solar] resources, diversify our energy mix and will provide us with greater energy independ-ence whilst reducing carbon emissions”

To ensure the CSP project is financially viable, Chile´s Ministry of Energy operating through Corfo will pro-vide a subsidy of up to $20 million, as well as to op-tionally facilitate the access to land for the plant.

FinancingAdditionally, the government has negotiated a con-sortium of sources of financing mounting up to over US $350 million in soft loans.�n A direct subsidy from the European Union of up

to US$ 18,6 million�n The Inter American Development Bank (IADB) will

provide loans for at least US$66 million and up to 25% of the total project costs�n The German Development Bank (KfW) will provide

loans worth €100 million, channeled through CORFO and local banks

Key Take AwaysThe tender was revealed through a tendering docu-ment that can be downloaded from Corfo´s website in Spanish.

The project will be of any scale upwards of a mini-mum of 10MWe, and it will be connected to either SIC or SING (the Centre and Great North grid respectively)

Technical characteristics�n The plant can be of any CSP technology, including

parabolic trough, tower, fresnel and dish. The plant must also have a mínimum of 3 hours of storage at

The Chilean government launched the first tender for a project marketplace CSPSantiago de Chile: Jorge Bunster, Minister of Energy, together with Hernán Cheyre, Executive VP of Corfo, yesterday presented the first international CSP tender process in LATAM.

85% load, in order to guarantee the ability to dispatch. In the case of a tie the resolution of the tender, with all other metrics been equal, the committee will choose the plant with the largest amount of storage.�n Back up fuel is not allowed, other than to maintain

thermal fluids and/or molten salts at the right temperature to avoid freezing. In any case the amount of back up fuel cannot be higher than 6% of the annual electricity generated by the plant.

DNIEach project being considered for the tender must in-clude a year´s worth of meteorological data, includ-ing solar radiation data, wind speed and temperature at the location of the plant. The company must also undertake at least 6 months’ worth of DNI on-ground measurements after the project has been approved.

Land & WaterThe solar developer can either put their own loca-tion/land forwards in their proposal or use the land which the government has available for this project at Maria Elena.

Regarding water issues, the developer has to declare the amount that will be required for operation and maintenance of the plant.

Track RecordThe proposing company must present a summary of track record in CSP (either direct experience or experi-ence through a subcontracted company) including infor-mation about the degree of participating in engineering, construction, design and O+M of another CSP plant with a minimum of 10MW in size. The data to be submitted includes detailed information of project´s metrics.

PPADevelopers will have to demonstrate they have ar-ranged either a PPA or a MoU for the purchase of

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Christoph Tagwerker, Specialist in Energy Efficiency, Banco Interamericano de Desarrollo

Christoph Tagwerker works in renewable energy and energy efficiency division Sustainability Climate Change and Inter-American Development Bank. Its activities focus on project design, implementation, monitoring and evaluation of projects including technical advice and support for the IDB official investment and its customers.

Tell me about the role of the Banco Interamericano de Desarrollo in the bidding process for CSP in Chile? BID adopted a key role when it decided to back the Chilean government so that it could obtain funds from the Clean Technology Fund (CTF), particularly in designing the bid. In addition to this, BID is inter-ested in offering financial backing to the company that wins the bid. Part of the process requires that before getting the concessional funds from CTF, the company that participates in the bidding must take out a loan from BID’s private sector department.

What are your expectations for CSP in Chile? In our opinion, we consider that this bid will result in a CSP plant of at least 50MW, and that, obviously, it will give rise to the construction of future plants.

What are the major difficulties in getting financial backing from private banks?The main reason for the difficulty in obtaining financ-ing for this type of project is the lack of experience with CSP technology, and the risks that it brings are unknown for the initial stages of development.

Why have you chosen to back CSP in Latin America? (in other words, what future do you see for this technology in Latin America)The scenario for CSP technology in Latin America and, more specifically, in Chile, is extremely favo-rable. Firstly, we are located in the geographical area with the best conditions in the world for con-centrated thermal solar energy. If you add to this the increasing demand for energy, high energy prices (in some countries) and the necessity to diversify the energy portfolio, you can see why we believe in CSP. For these reasons, we believe that CSP should be part of the energy mix. In addition, one of our goals in respect to climate change is to reduce the carbon footprint in energy production.

What other projects of a similar nature do you have planned for the future? Firstly we want to see how the project develops in Chile. We currently don’t have a definite strategy in regards to expansion, but we would like to be able to spread our experience to other countries with simi-lar conditions as Chile.

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The potential of CSP in Chile

Mining is fast becoming an area of interest for CSP de-velopment – particularly CSP with storage. This is not surprising: currently the mining industry is present in more than 100 countries around the world. To sup-port the burgeoning demand for mined goods, a large, continuous, supply of energy is needed for extraction purposes and to power equipment. Whilst mines are increasing their production to meet the growing de-mand, at the same time they are receiving pressure to introduce sustainable, ‘green’, initiatives into their processes.

With many mining markets located in areas with good DNI conditions (see figures 1 and 2) at a glance it seems that the pairing makes perfect sense: CSP could pro-vide a green and potentially cost-competitive source of energy for mining activities, particularly those in emerging markets where access to the electricity grid

Mining, CSP and emerging markets: what is the potential?

or gas network may pose a challenge.

CSP Today examines the markets which are best suited to CSP and mining hybridization.

Markets for CSP and Mining HybridisationThe most important mining countries in terms of min-eral production are shown in Figure 1. Many of them are emerging economies that are located south of the equator, such as Chile, South Africa, Peru and Australia.

In the last years, the mining sector in Latin America, Africa and parts of Asia has seen huge investments that are expected to continue growing in the coming years. The increasing investment in new mining facilities will in turn increase the amount that mines need to produce thereby increasing their energy consumption. CSP, par-ticularly CSP with storage, is a definite solution that has

Global over view of mining-active industries in 2011

Source: Raw Materials Group. Stockholm, Sweden

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PART 2: CSP Today Guide: Chile 2013

Technology

Transcript of PART 2: CSP Today Guide: Chile 2013