The sustained and auspicious growth of solar energy in Chile
December 13, 2023
Cost Reduction and Efficiency Improvements Make Solar Energy a Key Player in Global Energy Sustainability
In 2016, American politician and environmentalist Al Gore expressed excitement about Chile’s solar market growth. Felipe Larraín, an academic and researcher at the Energy Transition Center of Universidad Adolfo Ibáñez (CENTRA UAI) and a Ph.D. in Electrical and Computer Engineering from Georgia Institute of Technology, Atlanta, recalls this moment:
“By late 2013, Chile had 11 MW of approved or under-construction photovoltaic solar projects. By the end of 2014, this had risen to 402 MW; in 2015, to 848 MW; and in 2016, to 13,300 MW. Since then, the story has become even more exciting.”
Larraín continues: “Five years later, Chile had more than doubled the figures highlighted by Al Gore. By the end of 2021, Chile had 31,300 MW of approved or under-construction solar projects. By October 2023, the country had exceeded 9,000 MW of installed capacity. Undoubtedly, Chile is aligned with industry growth and can be considered a pioneer with a success story. However, this growth brings new technical, economic, social, and environmental challenges.”
Because of this, Larraín believes Chile has a unique opportunity to create value in the photovoltaic sector, leveraging its infrastructure, human capital, and academic contributions through research and innovation.
Additionally, solar panel prices have dropped more than 500 times over the past 47 years, leading to massive global market expansion.
“Early solar plants had an installed capacity of around one megawatt and used approximately 4,000 panels. Today, a typical solar farm uses modules with at least double that capacity. Previously, 4,000 modules were needed to generate one megawatt, with each panel producing around 250 watts. Today, panels have about 500 watts of capacity and cost 20 times less than before. We are now in a more sustained growth phase, which is expected to reach market saturation in the next 10 to 15 years,” explains Larraín.
A New Paradigm
Solar energy is integrated into nearly every economic sector, though most panel installations are for large-scale electricity production within interconnected power systems.
What are the main environmental, economic, social, and technical benefits?
“Every photovoltaic solar plant connected to the national grid helps reduce Chile’s carbon footprint, significantly cutting greenhouse gas emissions—mainly CO₂. Additionally, solar energy is one of the cheapest sources of electricity, thanks to the dramatic drop in solar panel prices. This has made photovoltaic power more competitive than traditional sources like gas or coal-fired plants.”
From an environmental and social perspective, solar energy also makes decarbonization more feasible and reduces the need for massive hydroelectric projects, such as HidroAysén, which faced strong environmental opposition.
On a technical level, Larraín highlights a unique characteristic of solar energy: modularity.
“A solar panel is modular, meaning it can be used for both small residential and large-scale utility projects. Unlike wind energy, where dividing a wind turbine into 6,000 parts wouldn’t make sense, solar panels enable the rise of distributed generation, allowing consumers to produce and inject energy into the grid, shifting the traditional energy paradigm.”
Does Chile Have a Unique Opportunity to Create Value in the Solar Sector?
Chile started earlier than most Latin American countries, gaining experience its neighbors lack.
Additionally, Chile has exceptional climatic conditions, particularly in the Atacama Desert, which has the highest solar irradiance on the planet.
“Starting early means facing some challenges before other nations. Currently, Chile has more than 9 GW of installed solar capacity, equivalent to over 18 million panels. By 2030, this number will at least quintuple, meaning that recycling and second-life solutions for panels will soon become necessary,” Larraín warns.
What Does It Mean That Chile Has the Highest Solar Irradiance on the Planet?
In specific regions, particularly the Atacama Desert, Chile receives an average of over 7 kWh/m²/day of solar radiation, exceeding 10 kWh/m²/day in some areas.
However, Chile’s national electrical grid lacks sufficient transmission capacity to fully utilize this solar potential.
“While transmission planning accounts for some energy losses, it is clear that Chile needs grid expansion and energy storage solutions to eliminate bottlenecks. There are still technical, regulatory, and market challenges that must be resolved to fully harness our solar energy potential.”
Floating Solar Plants: A Rising Trend
In 2014, Horacio Melo and José Luis Carvallo founded Solarity, a photovoltaic energy company now owned by Brookfield Renewable. The company designs, builds, and operates solar plants, offering a cost-effective and sustainable alternative for businesses.
“Our goal was to create a sustainable, cheaper energy option where clients don’t have to invest or worry about operations. Today, we have over 139 solar plants for self-consumption across Chile, with more than 50 MWp in operation, construction, and development,” explains Carvallo.
Solarity also operates five floating solar plants, including facilities in drought-stressed regions like Putaendo and San Felipe.
The latest floating solar plants, installed for Verfrut, were custom-designed for agricultural operations:
- Quilamuta Farm (1,090 kWp) – Located in Las Cabras, O’Higgins Region
- La Cabaña Farm (510 kWp) – Located in San Pedro, Metropolitan Region
The Quilamuta solar plant is the largest floating photovoltaic plant in the Southern Cone, covering 8,500 m², with 2,000 panels and 2,500 floating structures, supplying 40% of the farm’s energy demand.
Unlike rooftop or ground-mounted solar plants, floating solar installations are built on reservoirs or ponds, anchored to the water body to prevent movement caused by waves or wind.
“Floating solar is ideal for agricultural businesses with irrigation reservoirs,” Carvallo adds.
Advantages of Floating Solar vs. Traditional Solar Plants
- Reduces water evaporation by up to 60%
- Boosts energy efficiency by up to 20% (cooler panel temperatures near water improve performance)
The Next Step: Energy Storage
“The natural next step is integrating energy storage systems to enhance solar plant capacity and give customers greater flexibility—allowing them to use their self-generated electricity at any time, day or night, 365 days a year. This would further decarbonize operations,” Carvallo explains.
How Has Chile Progressed in Solar Energy Development?
- Large-scale solar adoption has significantly contributed to Chile’s national energy capacity.
- Transmission and distribution limitations remain major obstacles.
“Chile still faces big challenges in delivering a reliable, environmentally friendly, stable, and high-quality energy service to the end consumer. This is where self-consumption solar and storage solutions for homes and businesses play a crucial role and have immense growth potential.”
Source: El Mercurio