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Here are some key discussion topics ahead of the Chile Energy Transition 2025 Summit, hosted by sustainability and green energy organization Net-Zero Circle in Santiago, Chile, on August 27-28.
There’s a growing synergy between Chile’s renewable energy development and its strategic role as a global supplier of critical minerals, such as lithium and copper. The consumption of energy from mines is very high, but at the same time companies around the world are fighting to be greener.
In an article on its website, miner Rio Tinto highlighted that Chile’s deposits of minerals like copper and lithium could fuel the renewable energy transition.
“Today, Chile is the world’s largest copper producer, accounting for 22% of global copper production. The country is also the second largest producer of lithium globally, with around 24% of global production. The production of copper and lithium can often be energy-intensive, and as demand increases, so too does the need for producing the minerals in a more sustainable way,” the company stated.
“At our Rincon site in Argentina, we are using Direct Lithium Extraction (DLE), a technology that allows for the processing of brine without the requirement of pre-concentration ponds. We’ve also spent 30 years testing and developing a solution for producing copper in a more responsible way,” Rio Tinto added.
According to William Adams, head of base metals and battery research at Fastmarkets, miners around the world are trying to reduce their carbon footprints, and their environmental footprints too.
“In places like the Atacama in Chile, there is every opportunity to build solar power generation plants, as it is one of the driest places on Earth, suggesting blue skies, which would be good for solar power generation. When lithium is produced in Chile, it is then often sent to China for processing and turned into batteries in either China, Japan or South Korea, before being sent back around the world again in battery cells to North America or Europe. The lithium’s carbon footprint in terms of where it is shipped is high, so anything that can be done to reduce that, i.e. by using solar power in upstream production, helps reduce its overall footprint,” Adams said.
Jose Hofer, consultant and advisor of lithium at SC Insights, told Fastmarkets that Salar de Atacama in Chile has a formal advantage “because it has the best operation rate, highest concentration of lithium, lowest energy use and limited use of water.”
Claudia Cook, senior analyst for lithium at Fastmarkets, also highlighted that the hot and arid salt flats, called salars, in Chile result in high evaporation rates and provide large open spaces, both critical components of lithium extraction from traditional evaporation ponds.
“As well as lithium production the large wide open, sun drenched salars, in particular the Atacama, have lent themselves to being a hub for solar panel and wind farms, as well as plans for a battery storage project — enabling Chile to grow its energy mix from renewable sources and toward its climate goals,” Cook said.
Data from the International Energy Agency (IEA) shows the scenario for electricity generation sources in Chile in 2023: 26% of total generation is hydro; 20.3% is solar photo-voltaic (PV) and 18.6% is natural gas. On the other hand, coal is 16.1%; oil 1.8%; biofuels 6.3% and wind 10.4%.
According to a report by the association of electricity generators Generadoras de Chile in December 2024, Chile achieved a remarkable milestone, with around 79% of its electricity generation coming from renewable sources.
The World Economic Forum highlighted in an article that Chile had set an ambitious goal of converting 70% of its total energy consumption to renewables by 2030 and pledged to become carbon neutral by 2050.
“The country’s energy transition strategy has evolved in recent years due to a combination of broad-based political support and innovative green technologies. Despite its historic ties to fossil fuels and copper mining, Chile in recent years has accelerated its energy transition through broad-based political support, private-public partnerships and innovative green technologies,” the Forum stated.
The Forum also mentioned that green hydrogen sits at the heart of Chile’s energy transition.
“Chile’s National Green Hydrogen Strategy calls for incorporating green hydrogen into the country’s mining and commodity sectors, as well as other carbon-reliant local supply chains. The strategy estimates that Chilean green hydrogen could be among the most affordable in the world due to its favorable renewable energy environment,” the Forum stated.
The Green Hydrogen Fund for Chile — a Team Europe initiative by the European Investment Bank (EIB), the German development bank KfW and the EU delegation in Chile — will support a wide range of hydrogen projects, from water desalination and renewable power generation to storage and transport. As part of this initiative, the EIB is providing a €100 million ($117.14 million) loan to Chile to support private sector projects, according to the EIB website.
“As the world’s largest copper exporter and a key lithium producer, Chile plays a central role in the global green transition. The financing will increase investment in green technology while cutting emissions in crucial supply chains, benefiting not only mines but other resources,” the EIB stated.
According to Fastmarkets’ research team, in 2023, 71% of operational lithium producers that have an ESG report used renewable energy, with 18% being the average ratio of renewable energy use/total energy use. Half of the renewable energy use was generated onsite,15% purchased and 15% a combination of onsite generation and purchased.
Half of ESG-reporting lithium producers have set renewable energy goals. Albemarle, for example, committed to 100% renewable electricity for facilities in Chile and Kings Mountain, with additional renewable energy acquired for Silver Peak. SQM also aimed to significantly increase the share of renewable energy in the global energy mix by 2030.
Still, reported data for 2023 indicates a high dependency on the use of fossil fuels, with diesel, natural gas and coal accounting for approximately 92% of total fuel consumption in the case of lithium operations.
In pursuit of carbon neutrality in specific target years, lithium producers committed to a range of carbon reducing measures that Fastmarkets’ research team is monitoring.
Sources told Fastmarkets that there’s an urgency in expanding Chile’s transmission grid to accommodate increasing renewable energy projects and growing demand, by exploring strategies to reduce transmission bottlenecks and enhance renewable integration.
Chile’s 2025 Energy Transition Law brings new obligations for transmission companies. According to the Chilean government’s website, the new law offers huge opportunities for regions throughout Chile that are facing production problems due to limited electricity transmission.
“The Energy Transition Law has been designed to address a series of challenges that are facing the sector. It seeks to provide a global solution to problems in the field of generation, and for electricity transmission to help the decarbonization process. One of the main benefits of the new Energy Transition Law is the correction of delays to transmission,” the government said.
Mining companies have to align high energy consumption with decarbonization commitments and evolving permitting standards, as they have a strategic role in supporting Chile’s energy infrastructure and supply needs. At the same time, some strategies must ensure a stable and affordable energy supply for mining operations without bottlenecks, Fastmarkets heard.
“The DLE projects [from] SQM and Albemarle in Chile, for example, will increase 15 times the energy consumption in Salar do Atacama. Another additional transmission line will be necessary to supply both projects,” Hofer said, adding that Chile is also facing a crisis in terms of permitting, which influences renewable sources development.
Cook highlighted that, as the sun and climate do much of the work to extract the lithium, energy consumption for traditional brine projects is much less on average, when compared with lithium from hardrock or sedimentary sources. This therefore often results in brine projects being lower cost and producing lower emissions compared with other deposit types.
“Both companies operating in Chile are seen as being among the most sustainable in the world; this is in large part due to the fact that they are brine projects. They are seen as being one of the most sustainable due to their measuring and reporting of emissions, as well as joining the [Initiative for Responsible Mining Assurance’s] IRMA Standard for Responsible Mining — a voluntary [program] that measures social and environmental performance,” Cook said.
For the analyst, the majority of the sustainability efforts are not as a result of Chilean policy or permitting, but rather the policy and sentiment in potential buyers’ countries.
“Currently there is no known permitting that limits or directs energy use or source. Energy is not a topic that is often brought up when thinking of brine projects and their environmental impact,” Cook said.
The countries that comprise the Lithium Triangle — Argentina, Chile and Bolivia — currently control more than 50% of global lithium resources, with production concentrated in the countries’ salt flats regions, where there are lithium brine deposits
Fastmarkets expects Chile’s lithium carbonate equivalent (LCE) production to increase to 434,000 tonnes of LCE in 2035, rising at a compound annual growth rate (CAGR) of about 4% from 296,700 tonnes of LCE in 2025.
Chile currently has 21 projects in different stages, with two operations working.