April 17, 2022

Recently established, the Center for Energy Transition (CENTRA) at Universidad Adolfo Ibáñez aims to bridge the gap between scientific research and the development of innovative solutions for the global energy transition. The center focuses heavily on Chile’s unique energy sector challenges and works closely with local industry and the public sector.

To learn more about the need for an energy transition and how to achieve it, we spoke with Daniel Olivares, Executive Director of the Center for Energy Transition (CENTRA) at Universidad Adolfo Ibáñez.


Every day, the need for a more resilient and sustainable energy matrix becomes more evident. Are we doing enough to achieve this goal?

Chile and the rest of the world are navigating uncharted territory regarding the impacts of climate change on the infrastructure that provides essential goods such as water and energy. In this context, it is difficult to assess whether the measures taken so far have been sufficient and cost-effective in terms of resilience and sustainability.

However, one aspect that can be evaluated is the ability of governments to respond to crises in the energy sector through rigorous technical analysis and consensus-building around the necessary measures to overcome them. In my opinion, this capacity has been inadequate in recent years, as evidenced by long regulatory discussions that fail to meet expectations.

That said, there have been notable government efforts in energy transition, such as the development of long-term strategies in power system flexibility, electromobility, and the hydrogen industry. These initiatives are moving in the right direction, promoting the efficient integration of renewable energy, the conversion of industrial processes to clean electricity and fuels, and Chile’s potential as a major exporter of clean energy.

Additionally, the current administration has signaled a focus on energy security, though we are yet to see the specific measures associated with this priority.


What are the main challenges in achieving the energy transition?

One of the biggest challenges in managing the climate crisis in the energy sector is reaching a consensus on the right balance between present and future costs to society. Given the high uncertainty about future costs, technological advancements, and global policy decisions, this is a complex issue.

It is difficult to believe that Chile’s energy market alone can efficiently and sustainably shape the future energy supply landscape under such uncertainty. Thus, it is crucial for the State to take a far more active role than it has in recent decades. Hopefully, the new institutional framework established by the Climate Change Framework Law will equip the Ministries of Environment and Energy with more effective tools to implement a long-term sectoral vision aligned with emission reduction goals and supply resilience.

Regarding specific barriers and challenges, the successful implementation of Chile’s National Electromobility and Green Hydrogen Strategies will be crucial. These policies have the potential to significantly reduce fossil fuel demand while boosting the country’s clean energy export capacity.

Additionally, structural barriers to the development of distributed energy resources (DERs)—such as rooftop solar, distributed storage, and small-scale generation projects (PMGD)—must be eliminated. Recent studies highlight the immense potential of these technologies for efficient, sustainable, and resilient energy development in Chile. However, this potential cannot be fully realized until the long-awaited comprehensive reform of Chile’s electricity distribution system is implemented.


How can technology help “accelerate” the energy transition?

The speed of the energy transition will depend heavily on our ability to lower costs or increase the benefits of a carbon-neutral energy system.

In this context, there is enormous technological potential in smart energy resource management, which can:

  • Enhance demand flexibility to enable the efficient integration of variable renewable energy.
  • Improve local grid resilience by better managing distributed resources in the event of natural disasters or system-wide blackouts.
  • Facilitate the cost-effective conversion of fossil-fuel-based processes to electricity, green hydrogen, or its derivatives.

These and many other opportunities require investment in R&D and can be developed in Chile, where a critical mass of researchers is already available.


What role do renewable energy and battery energy storage systems (BESS) play in the energy transition?

Chile’s abundant renewable energy potential has been the driving force behind the energy transition in the electricity sector for decades.

For a long time, this potential benefited from the flexibility of the country’s existing hydro and gas-fired power plants, which allowed for the integration of renewable energy without major operational constraints. However, as renewable generation capacity continues to grow, the share of flexible generation technologies has declined, while transmission system limitations have become more pronounced. These constraints have started to hinder renewable energy operations and slow investment in new projects.

In this context, BESS (Battery Energy Storage Systems)—which have experienced significant cost reductions over the last five years—are the ideal solution to unlock further renewable energy development. These systems:

  • Maximize the use of transmission corridors.
  • Enable renewable energy to be stored and used during periods when it is not available.

How is CENTRA working with the industry to implement more sustainable and resilient energy sources?

Developing sustainable and resilient energy supply systems is one of the four interdisciplinary challenges defined by CENTRA.

As such, we continuously monitor opportunities for collaborative research and development projects with industry and the public sector to address both theoretical and practical challenges.

Our main mechanism for industry collaboration is the CENTRA Industrial Research Program (IRC), which promotes applied research to answer key questions of interest to the local energy industry.

For instance, with the sponsorship of ACESOL, we have launched a research program focused on distributed energy integration in Chile. This initiative aims to:

  • Develop knowledge and tools for sustainable and resilient energy supply systems.
  • Facilitate investment and operational decision-making in the energy market.
  • Inform regulatory and policy reforms.

Finally, what does the “ideal” energy matrix for Chile look like?

The “ideal” energy matrix is something of a mirage—not only does it move further away as we advance, but its shape also changes based on new scientific discoveries, technological developments, and geopolitical shifts.

That said, we can identify certain key characteristics that will gain importance in the future, beyond economic efficiency, security, and sustainability. These include:

  • Primary energy self-sufficiency.
  • Supply system resilience against extreme climate events and disasters.
  • The democratization of energy supply.

Regardless of what form our future energy vision takes, one thing is essential: having a flexible institutional framework that allows for regulatory adaptation to meet long-term goals. Additionally, decision-making must be grounded in sound technical analysis to ensure a successful transition.