Chilean mines are turning to renewable energy: CSP, PV and wind power

The mining industry requires a lot of energy to keep moving, and bottom lines depend on keeping the price of that energy as low as possible. To maintain efficiency, the mining industry seems to be increasingly looking to the renewable sector to supply its power, an action that is especially prevalent in Latin America regions like Chile.


According to a recent Wall Street Journal profile, it is estimated by Ernst & Young that mines in Latin America will invest upwards of US $1 billion in renewable energy projects by 2022, a sharp upswing from the $37 million invested in 2013—but with the benefits renewable are providing, it’s not hard to see why.

In its profile, the WSJ zeroes in on this trend in Chile, particularly at Codelco’s Gabriela Mistral mine. Once powered by 67,000 barrels of diesel a year, the mine now sources approximately 80 percent of its power from around 3,000 solar panels at a thermosolar plant run jointly by Chile’s Energia Llaima SpA and Denmark’s Arcon-Sunmark.

According to the report, the trend in Chile has been spurred on by some of the world’s highest conventional energy costs due to Chile’s reliance on energy imports. At a rate of closer to $80 per megawatt hour, the price of renewable energy like solar and wind power makes perfect economic sense for Chile’s mining sector, to a much higher degree compared to countries with more access to domestic conventional energy sources. Not only is it being looked at favorably, but the Chilean government is actively encouraging renewable energy, with plans to make the country at least 20 percent reliant on renewables by 2025:

“Unlike in developed countries where the main driver of renewable energy development has been the reduction of greenhouse-gas emissions, that isn’t the principal driver here, but rather energy security and competitive prices,” said Fernando Hentzschel, the director of development and technology at Cifes.


But where Chile lacks in traditional energy, strong winds and high solar radiation levels set the country up perfectly o reap the benefits of solar power, leading to a unique situation where the mining industry is experimenting with several ways to source energy—the report notes that in contrast to Codelco’s solar farm, Antofagasta is sourcing 20 percent of its power from wind turbines at its Los Pelambres mine.

In addition to driving costs down, the development of renewable energy infrastructure is also helping Chile to become energy self-reliant, which is always valuable. While the mining industry asserts that the renewable energy industry isn’t strong enough to be Chile’s sole energy source yet, it’s still a strong help:

“If you are producing [energy] eight hours, that is an issue,” said Carlos Barrera, the Latin American vice president for SunEdison Inc., a U.S.-based firm that supplies solar power to Chilean iron-ore company Compañía de Acero del Pacífico. “With those eight hours, you can still reduce the cost of mining in a big way, but obviously that is not the full solution required.”

But while solar and wind only provide energy part of the day, they are performing an essential service that could see significant further growth in the years to come.