VZCZCXYZ0014
RR RUEHWEB

DE RUEHSG #1118/01 3241610
ZNR UUUUU ZZH
R 201609Z NOV 09
FM AMEMBASSY SANTIAGO
TO RUEHC/SECSTATE WASHDC 0301
INFO MERCOSUR COLLECTIVE
RHEBAAA/DEPT OF ENERGY WASHINGTON DC

UNCLAS SANTIAGO 001118 
 
SIPDIS 
STATE FOR WHA/BSC, WHA/EPSC AND EEB/ESC 
 
E.O. 12958: N/A 
TAGS: ENRG ECON EINT TRGY DOE CI
SUBJECT: CHILE'S RENEWABLE ENERGY WEEK INCLUDES U.S. EXPERTS IN SOLAR 
AND BIOFUELS 
 
REF: MONTEVIDEO 616; SANTIAGO 641; SANTIAGO 496 
 
¶1.  SUMMARY:  Chile, which is looking to boost its use of renewable 
energy as a means to improve energy security and combat the effects 
of climate change, hosted a week of renewable energy events October 
5-9 focused on two areas where Chile appears to have comparative 
natural advantages:  solar and algae-based biofuels.  The prominent 
participation of U.S. energy experts -- including two sponsored by 
the USG -- reflects robust U.S.-Chile energy cooperation.  END 
SUMMARY. 
 
 
 
¶2.  Background:  Chile is a country abundant in renewable energy 
possibilities, unrivaled solar resources in the northern Atacama 
desert, over 4,200 kms of coastline with large tidal differentials, 
as well as wind and geothermal potential.  In March 2008, Chile 
passed a law requiring electricity generators to produce at least 
five percent of their energy from non-conventional renewable energy 
sources (this excludes  large-scale hydroelectric projects over 20 
MW) by 2014 and 10 percent by 2024.  Over the last year and a half, 
Chile's Economic Development Agency (CORFO) and its National Energy 
Commission (Commission Nacional de Energia - CNE) have been working 
to create favorable conditions for renewable energy development, 
including a transmission fee exemption for small scale generators 
and developing financial instruments, loan guarantees, grants for 
electricity transmission lines to connect renewable energy projects 
to the grid, grants for geothermal drilling, etc. 
 
 
 
¶3.  Along with CNE, CORFO is developing two solar pilot plants, one 
using photovoltaic (PV) technology and another using concentrating 
solar power (CSP), and launched a renewable energy center (REC) in 
October to act as an antenna for new renewable technologies and 
provide assistance to project developers (refs b and c).  During 
President Bachelet's visit to Washington in June 2009, Chile's CNE 
and the U.S. Department of Energy (DOE) signed a Memorandum of 
Understanding (MOU) on Clean Energy Technology Cooperation to 
facilitate collaboration on energy efficiency and renewable energy, 
including technical assistance for Chile's new REC and CSP pilot 
project. 
 
 
 
¶4.  To promote investment in Chile's renewable energy sector, CORFO 
has also sponsored a number of workshops and seminars.  The largest 
was the Fourth International Conference on Renewable Energy 
Investments in Santiago, September 7-8. The international event 
brought together over 1,000 private investors, carbon market 
intermediaries, national project developers, service suppliers, 
banks, public agents and experts in the renewable energy and CDM 
sectors.  Although smaller in scale, Chile's "Renewable Energy 
Week" in October featured two major seminars on technologies the 
country may have a natural advantage in developing:  solar and 
algae-based biofuels.  End background. 
 
 
 
Launch Features Nobel-Prize Winning Nuclear Physicist Touting 
Renewables 
 
--------------------------------------------- ---------------------- 
--------------------------- 
 
 
 
¶5.  Energy Minister Marcelo Tokman kicked off Chile's 2009 
Renewable Energy Week with a comprehensive overview of Chile's 
energy challenges and efforts to secure its energy supply.  Tokman 
described how high energy prices combined with drought and reduced 
supplies of natural gas from Argentina to create the "perfect 
storm" in 2008, which forced Chile to work to strengthen its 
institutions, increase energy efficiency and begin to develop the 
country's vast renewable energy potential.  He highlighted pending 
government solicitations for two solar pilot plants.  The launch 
concluded with the Energy Minister and other luminaries cutting a 
ribbon to open "Energiza Chile," an exhibition of the country's 
renewable energy associations, projects and technology providers. 
 
 
 
¶6.  Opening remarks by Nobel-prize winning physicist Carlo Rubbia 
focused on the potential of solar energy as a source of 
 
 
hydrogen-based power.  Rubbia also participated in a panel with 
three Chilean parliamentarians, who spoke about how Chile's move 
from petroleum-based sources to renewables is hampered by a lack of 
institutions, human resources and incentives. 
 
 
 
Solar Seminar Highlights Dueling Technologies; Overcoming Technical 
Challenges 
 
--------------------------------------------- ---------------------- 
----------------------------------- 
 
 
 
¶7.  An international solar seminar co-hosted by CNE and the U.N.'s 
Economic Commission on Latin America and the Caribbean (ECLAC) 
featured keynote speakers Stanford Ovshinsky, a U.S. inventor, and 
Dr. Rubbia.  The speakers emphasized competing visions for 
harnessing solar power.  Rubbia focused on concentrating solar 
power (CSP), and Ovshinsky's presentation highlighted his lifelong 
efforts to develop efficient photovoltaics (PV), including 
mass-production of thin solar films, and developing the 
rechargeable nickel-metal hydride (NiMH) batteries used in hybrid 
vehicles and many consumer electronics. 
 
 
 
¶8.  The solar seminar also featured developments in solar 
technologies by international experts from Germany and Spain, as 
well as various solar companies presenting on large-scale 
commercial projects.  U.S. expert Craig Turchi, Director of a 
project to transform the CSP market at the U.S. Department of 
Energy's National Renewable Energy Lab (NREL), provided a 
pre-recorded presentation on various solar technologies and the 
challenges of storage, costs, environmental impacts and 
transmission. 
 
 
 
International Perspectives on Biofuels from Algae - Chile's 
Potential 
 
--------------------------------------------- ---------------------- 
----------------- 
 
 
 
¶9.  A seminar on innovations in algae-based biofuels followed the 
solar seminar.  A central theme for the event was the potential for 
Chile to produce biofuels from algae given its rich marine 
resources, high levels of solar radiation (required for rapid 
growth of these organisms), and the fact that the country does not 
grow many of the food crops (e.g., sugarcane) generally associated 
with second generation biofuels.  The seminar covered both micro- 
and macro-algae technologies and featured studies of the many 
different factors that impact biofuel production from these 
sources. 
 
 
 
¶10.  Two U.S. biofuels experts, Bryan Willson from Colorado State 
University (CSU), and Richard Simmons, a science and technology 
fellow at the U.S. Department of State, joined a panel on the 
"International Vision of Second Generation Biofuels" with 
representatives from the International Energy Agency (IEA), the 
European Commission and the Interamerican Development Bank. 
Simmons, an engineer who has worked on reducing internal combustion 
engines' emissions and fuel consumption, provided the U.S. and 
regional policy context by tracing the stages of first generation 
biofuels.  He noted that ethanol and biodiesel products are 
commercially viable because certain countries, i.e., the U.S. and 
Brazil, committed to innovation and invested resources into 
biofuels research and development (R&D).  He opined that second 
generation biofuels will require increased levels of international 
cooperation. Willson, Director of CSU's Engines and Energy 
Conversion Laboratory and owner of his own company, Solix Biofuels, 
provided insights from his university and private sector 
experiences developing micro algae-based biofuels and delved into 
the technical innovations needed to make algae-based products 
commercially viable. 
 
 
 
¶11.  InnovaChile, a program supported by CORFO, highlighted that it 
has provided approximately $6 million to create several 
 
 
public-private consortiums to study/develop second generation algae 
derived biofuels.  CORFO plans to assign 85% of its FY2010 funds to 
energy projects, including biofuels development. 
 
 
 
U.S. Experts Make the Rounds 
 
-------------------------------------- 
 
 
 
¶12.  The Embassy helped program the U.S. biofuels experts in 
addition to their participation in the renewable energy seminars in 
Antofagasta.  Willson gave a presentation on low-cost biofuels 
production from micro algae to the University of Santiago de Chile. 
He also met with representatives of the CNE, CORFO, and other 
government officials, along with university and industry 
representatives of several petroleum companies to exchange 
experiences and discuss development of a biofuels cluster in Chile. 
In addition to outreach with industry and academic representatives, 
Simmons held in-depth discussions with Fundacion Chile, a 
non-profit innovation incubator and think tank, and spoke at a 
roundtable discussion on "Bridging the Biofuel Generation Gap" 
hosted by post's Green Committee. 
 
 
 
¶13.  Ambassador Simons hosted Ovshinsky and a group of educators 
and innovators for a breakfast discussion on October 8.  Ovshinsky 
noted that Chile has a natural resource in the sun that is much 
more powerful than oil and plenty of room in its northern desert 
for solar collectors.  Citing the two solar pilot projects, he 
praised Chile for having the vision to make this happen, and toted 
the value of investing in education to promote innovation. 
Following the breakfast, Ovshinsky and the Ambassador participated 
in a panel on climate change at the Democracy and Development 
Foundation of former Chilean President Ricardo Lagos. 
 
 
 
Public-Private Association to Develop Renewable Energy Capacities 
in Antofagasta 
 
--------------------------------------------- ---------------------- 
----------------------------------- 
 
 
 
¶14.  On the margins of the solar conference, ESTH Officer and EPOL 
Specialist met with the Chilean Chamber of Construction - 
Antofagasta (CChC-A) chapter's president, Carlos Arenas, along with 
CChC-A staff and associated members.  The group outlined efforts to 
organize business sector representatives and academics into a 
public/private consortium to promote R&D in non-conventional 
renewable energy in the region.  They requested U.S. assistance in 
facilitating access to updated research and technology related to 
renewable energy (e.g., net metering, concentrated solar panel 
systems), as well as establishing ties with U.S. agencies, research 
laboratories (including NREL), and universities to identify 
academic, technical, and student exchange programs. 
 
 
 
¶15.  COMMENT:  Since 2008, Chile has made progress on promoting 
renewable energy and has been somewhat successful in developing 
commercial wind and run-of-river hydroelectric projects.  However, 
Chile is nowhere close to realizing the full energy potential of 
its rich array of natural resources and clearly recognizes the need 
to build international relationships to attract investment and 
innovation in renewable energy technologies in which it may have a 
comparative advantage.  The four U.S. experts who participated in 
the week-long series of events in Antofagasta did an impressive job 
of showcasing U.S. innovation, policy and technologies in both 
solar and biofuels.  The strong U.S.-presence reflects on-going 
collaborative efforts under both the new U.S.-Chile Clean Energy 
MOU and our long-standing Science and Technology agreement.  These 
types of exchanges are critical as Chile continues to develop the 
policy framework needed to foster its renewable energy sector.  END 
COMMENT. 
SIMONS