Concentrated Solar Power for Chile’s mining industry

German bank KfW will provide funds to help build Chile’s first solar-thermal power plant, primarily to supply power to mines. The Concentrated Solar Power (CSP) plant is expected to cost $1.2 billion in total, and KfW will advance a $123-million loan for the 110-MW plant being built by a unit of Spain’s Abengoa SA (ABG), Germany’s environment ministry will back the project by providing interest subsidy and consulting services, it said separately.

“This project will help prove the economic operation of concentrated solar power technology in the earth’s sunbelt,” German Environment Minister Barbara Hendricks said. “Because it can store energy, this technology is also suited for basic electricity supply and therefore highly innovative.”

At the same time, the EU Commission will provide an investment grant of €15 million with funds from the Latin America Investment Facility.

“The construction of the first CSP plant in Chile is an important step on the way towards Chile’s energy turnaround, which should also make a significant contribution towards introducing this innovative technology in Chile and the surrounding region. Promoting the expansion of solar energy in Chile should help the country achieve an independent and sustainable energy supply, as well as to global protection”, stated Dr Norbert Kloppenburg, Member of the Executive Board of KfW Group.

Chile is facing the challenge of meeting the steady increase in demand for electricity in the course of its economic growth. The country has no known significant fossil fuel deposits and is therefore very dependent on energy imports from abroad (more than 60% of the primary energy requirements), despite its considerable installed hydropower. This has led to significant supply shortages and price surges in the electricity sector. To avoid this and set up its energy supply in an environmental and climate friendly manner, the country is now focusing on the significant expansion of renewable energies.

It was determined in the energy agenda agreed by the Chilean government in May 2014 that renewable energies have to make up 45% of the country’s new output between 2014 and 2025.

The rapidly growing mining industry in Northern Chile is the driver of the Chilean economy. It consumes some 80% of the electricity currently available, which is produced largely using coal, oil and gas. At the same time, solar radiation conditions in the Atacama desert are optimal for CSP technology.

The innovative facilities concentrate the sun’s rays using mirrors. A suitable heat transfer medium is heated up and channelled via pipelines into a thermal store or directly into a steam power plant. A steam turbine is driven in the latter, which then generates electricity through a generator.