Global Courant
The story of the meteoric rise of renewable energy in Latin America often focuses on Chinese influence, and rightly so.
The Chinese government, banks and companies have accelerated the continent’s energy transition by approx 90% of all wind and solar technologies installed there produced by Chinese companies. from China State network arranges now more than half of Chile regulated energy distribution, enough to cause concern to the Chilean government.
China has also become a major investor in Latin America’s critical minerals sector, a wealth of lithium, nickel, cobalt And rare earth elements which are crucial for the development of electric vehicles, wind turbines and defense technologies.
In 2018, Chinese company Tianqi Lithium bought a 23% share in one of Chile’s largest lithium producers, Sociedad Química y Minera. More recently, in 2022, Ganfeng Lithium purchased a major vaporization lithium project in Argentina for $962 million.
The Lithium Triangle of South America. Map: Researchgate
In April 2023, Brazilian President Luiz Inacio Lula da Silva and Chinese President Xi Jinping signed about 20 agreements to strengthen the already close relations between their countriesin areas such as trade, climate change and the energy transition.
China’s growing influence on global clean energy supply chains and its influence on countries’ energy systems have international concerns. But the relationship between China and Latin America is also becoming increasingly complicated as Latin American countries try to secure their resources and their own clean energy future.
In addition to international investment, Latin American countries nurture energy innovation cultures that are homegrown, dynamic, creative, often grassroots and often overlooked. These range from advanced innovations with high-tech materials to a phenomenon known as ‘frugal innovation’.
Chile looks to the future
Chile is an example of how Latin America is embracing renewable energy as it tries to plan for a more self-sufficient future.
New geothermal, solar and wind force projects – some built with Chinese support, but not everything – have pushed Chile well past its 2025 renewable energy target. About a third of the country is now powered by clean energy.
But the grand prize, and much of China’s interest, lies buried in Chile’s Atacama Desert, home to the world’s largest lithium reserves. Lithium, a silvery-white metal, is essential for the production of lithium-ion batteries that power most electric vehicles and utility-scale energy storage.
Countries around the world are struggling to secure lithium resources and the Chilean government is determined to maintain control over its reserves, currently about half of the planet’s known supply .
The Atacama Desert is located about 300 kilometers northeast of the Chilean city of Antofagasta at an elevation of 2,300 meters; 25% of the world’s lithium reserves are here. The SQM and Albemarle companies are currently mining the alkali metal. Photo: Condor
In April 2023, the President of Chile announced a national lithium strategy to ensure that the state has partial ownership of some future lithium developments. The move, which has yet to be approved, has signed complaints that it could slow down production.
However, the government is striving for it increase profits from lithium production while strengthening environmental protections and sharing more wealth with the country’s citizens, including local communities affected by lithium projects.
Latin America has seen its resources sold out below earlier, and Chile this time has no intention of losing its natural value.
Learning from foreign investors
Developing its own renewable energy industry has been a priority in Chile for more than a decade, but it has been a difficult road at times.
In 2009, the government started to set up national and international centers of excellence – Centros de Excelencia Internacional – for research in strategic areas such as solar energy, geothermal energy and climate resilience.
It invited and co-funded foreign research institutes, such as Europe’s influential ones Fraunhofer Institute and that of France ENGIE lab, to establish branches in Chile and conduct applied research. The last one is one center for the production of lithium using solar energy.
The government expected the centers to collaborate with local businesses and research centers and transfer knowledge to feed a local innovation ecosystem. The reality, however, has not yet lived up to expectations. The foreign institutions brought their own trained personnel.
And aside from the recently established lithium institute, officials tell us that low funding has been a major problem.
Startup incubator and thrifty innovation
While big projects make headlines, more is happening under the radar.
Chile is home to one of the largest public incubators and seed accelerators in Latin America, Start Chile. It has helped several local startups providing key innovations in food, energy, social media, biotech and other sectors.
In South America, this kind of innovation is often born and developed in a context of scarce resources and under technological, financial and material constraints. This ‘frugal innovation’ emphasizes sustainability with substantially lower costs.
Reborn Electric Motors converts old fossil fuel buses into fully electric versions. They are used in urban areas and also by the mining industry. Video: YouTube
For example, the independent Chilean startup Reborn electric motors has developed a company that converts old diesel bus fleets into fully electric buses. Reborn was founded in 2016 when Chile’s national electromobility market was still in its infancy, before China’s BYD ramped up the use of electric buses in local cities.
Reborn’s retrofitted buses are both technologically advanced and significantly less expensive than their Chinese counterparts. While BYD’s new electric bus costs about $320,000, a modified equivalent from Reborn costs about half that, about $170,000. The company has also secured funding to develop a prototype for it to run mining vehicles on green hydrogen.
‘Super cheap’ EV
Quantum Motors, a startup in Bolivia, launched its affordable mini vehicles in 2019. Photo: Xataka Mexico
Bolivia’s “little super-cheap EV” developed by homegrown startup Industrial quantum engines is another example of fuel-efficient innovation in the field of electric vehicles. The startup aims to bring electric mobility to the Latin American population at scale. It offers the smallest EV car possible, one that plugs into a standard electrical outlet. The car costs about $6,000 and has a range of about 55 miles per charge.
Phineal is another promising Chilean company offering clean energy solutions focused on solar energy projects. The projects include the installation of solar systems, electromobility technology and technology that uses blockchain to improve renewable energy management in Latin America. Many of these projects are highly advanced and technologically advanced projects that have found overseas markets, including in Germany.
Looking ahead to green hydrogen
Chile is also diving into another advanced area of clean energy. Using the abundant solar and wind energy to produce green hydrogen for export as a substitute for fossil fuels has become a government priority.
The government is developing one public-private cooperation of an unprecedented scale in Chile for hydrogen production and has pledged to cover 30% of an expected $193 million public and private investmentfinanced in part by its lithium and copper production.
There are some questions about the partnership, including Chile’s lack of experience in managing such a large project and concerns about the impact on the environment. The government claims that green energy production in Chile could ultimately rival its mining.
With abundant hydropower and sunshine, Latin America already meets one quarter of its energy needs with renewable energy – almost twice the global average. Chile and its neighbors expect those numbers to only increase.
Zdenka Myslikova is a postdoctoral researcher in clean energy innovation at Tufts University And Nathaniel Dolton-Thornton is assistant researcher climate policy at Tufts University.
This article has been republished from The conversation under a Creative Commons license. Read the original article.
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