The Net-Zero Circle

‍Low Carbon Chile’s Decade of Innovation: A Conversation with Dr. E. Plett

Low Carbon Chile has pioneered sustainable energy solutions for nearly a decade, combining energy efficiency with renewable technology. In this exclusive interview, Erwin Plett, CEO and Director of Low Carbon Chile, shares insights on the company’s achievements, the future of renewable energy in Chile, and the challenges and opportunities that lie ahead for the industry.

Low Carbon Chile has been providing innovative energy solutions for nearly 10 years. What do you consider your company’s most impactful achievement in terms of energy efficiency and sustainability during this time?

Dr Erwin: “Initially, our core business focused on promoting Energy Efficiency, specifically through products aimed at reducing CO₂ emissions and lowering energy consumption in vehicles. These technologies improve emissions without requiring modifications to internal combustion engines. However, we found that training drivers and encouraging habit changes could double the efficiency gains of technical solutions alone.”

“We've also conducted extensive training courses for clients, covering principles of Energy Efficiency across heating, cooling, lighting, and other uses. Over the last five years, our focus expanded to projects in Green Hydrogen and its derivatives, which hold great potential for building a sustainable industry from scratch in Chile.”

How do you see the future of photovoltaic self-consumption in Chilean industries and homes? What trends or regulations might affect this market?

“Since 2018, Chile has had legislation governing photovoltaic self-generation. However, solar power generation during the day doesn’t always align with peak usage times. The solution is to send excess energy to the grid during the day and retrieve it at night, though this often requires utilities to use fossil fuels for nighttime generation.”

“To avoid this dependency, consumers can invest in behind-the-meter storage systems, though this can be costly. Chile's net billing system offsets electricity costs, which has become more appealing due to recent rate hikes after a period of political tariff freezes.”

Given your expertise in various energy sectors, what do you see as the key drivers for expanding renewable energy adoption in Chile over the next five years?

“It’s essential to differentiate ‘energy’ from ‘electricity.’ In Chile, electricity makes up only 23% of final energy consumption, while 64% is fossil fuels, with 98% imported. While non-conventional renewable sources make up 37.9% of our electricity mix, we've over-expanded our variable electricity sources without enough transmission capacity, leading to wasted green electricity at midday. Large-scale energy storage solutions are crucial to managing this variability.”

“In addition to electricity, renewable fuels are essential for applications that cannot be electrified. The updated National Green Hydrogen Strategy aims to replace fossil fuels in thermoelectricity production and reduce fossil fuel imports. Within five years, we hope to see gigawatt-scale projects materialize, despite significant investment and permitting challenges.”

As the CEO and Director of Low Carbon Chile for almost a decade, what are the key lessons you’ve learned about leadership in the renewable energy and energy efficiency sectors?

“It’s important to remember that Energy Efficiency is distinct from Renewable Energy, and maximizing energy efficiency should always be prioritized before adopting renewable sources. Unfortunately, Energy Efficiency often receives less attention, leading to avoidable waste, such as leaving lights on in empty rooms or choosing cheaper, inefficient motors.”

“True leadership requires clear concepts and a commitment to educate all audiences, from policymakers to schoolchildren, about decarbonization. Partnering with professional associations amplifies these efforts, creating united fronts for both Energy Efficiency and Renewable Energy.”

How has your outlook on the global energy transition evolved over the years, and what role do you see yourself playing in this shift?

“The current transition to renewables is unprecedented in speed and scale, aiming for 70% renewable energy by 2050. Unlike previous transitions, this one requires not only technological shifts but also significant changes in behavior and mindset. Societies tend to resist change, making this a challenging endeavour.”

“As an engineer, I have embraced a public role to collaborate with both public and private sectors, supporting decision-makers in accelerating this transition and engaging with audiences to consider our finite world and the future of coming generations.”

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What has been the biggest challenge in promoting energy efficiency and renewable projects like thermosolar and photovoltaic plants in Chile? How is Low Carbon Chile addressing these challenges?

“Globally, fossil fuel subsidies average USD 500 billion annually, creating an uphill battle for renewables. Additionally, fossil fuel prices often don’t reflect their hidden social costs. Chile’s Carbon Neutrality Plan for 2050 anticipates 50% of reductions coming from CO₂ absorption and the rest from initiatives like Energy Efficiency and renewable energy expansion.”

“Chile’s Energy Efficiency Law currently applies to the largest consumers, and carbon taxes remain low at USD 5 per ton of CO₂, with 94.5% of this tax revenue paid by the electricity sector. While a single company can’t tackle these challenges alone, collaboration across sectors is essential. Low Carbon Chile partners with organisations like AEE, H2Chile, and the International Lithium Chamber to collectively advance solutions.”

Through the insights of Dr Plett, it’s clear that Low Carbon Chile is not only a leader in energy efficiency and renewable energy but also a committed advocate for sustainable transformation. With continued dedication to innovation and collaboration, Low Carbon Chile aims to drive significant progress in Chile’s journey toward a cleaner, more efficient energy future.

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November 13, 2024

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