Renewable and Sustainable Energy Reviews 81 (2018) 937–945

Contents lists available at ScienceDirect

Renewable and Sustainable Energy Reviews

journal homepage: www.elsevier.com/locate/rser

Electricity generation in Chile using non-conventional renewable energy MARK

sources – A focus on biomass
⁎
Carlos Rodríguez-Monroya, , Gloria Mármol-Acitoresb, Gabriel Nilsson-Cifuentesc,d
a
Universidad Politécnica de Madrid, Madrid, Spain
b
Spanish Authority for Markets and Competition, Madrid, Spain
c
Universidad Politécnica de Madrid, Madrid, Spain
d
RESITER, Santiago, Chile

A R T I C L E I N F O A BS T RAC T

Keywords: This article presents the development of biomass for electricity generation in Chile within the country's complex
Chile energy framework which is still unable to strengthen and encourage renewable energy development and relies
Renewable energy heavily on fossil fuels, increasing the latent risk of suffering an energy crisis in the medium term, due to the slow
Electric power incorporation of new energy power plants to meet the growing energy demand forecast. This article provides a
Biomass
background of the power generation status in Chile, along with an analysis of the country's electricity market
Environment
and its regulations, focusing on non-conventional renewable energy (NCRE), ending with the description of the
Sustainability
current development status of biomass for electricity generation in its three physical states, its features,
applications, conversion processes, advantages and disadvantages. Chile presents a low proportion of renewable
energy technologies within its energy mix, in which solid and gaseous biofuels are mainly used for low power
energy generation, through cogeneration and biogas extraction and use, while liquid biofuels are under research
through the development of pilot plants managed by several entities for industrial production and the
transportation industry.

1. Introduction generate tensions among the different pillars of sustainability. NCRE

Power generation in Chile using non-conventional renewable
energy (NCRE) represents an economic and environmental alternative
that is feasible for the provision of energy to remote communities (rural
areas) and for the expansion of the installed electrical capacity, either
through isolated systems or through projects connected to the grid [1].
Chile is endowed with the resources that are required to develop
hydraulic, solar, geothermal, wind and biomass systems, and therefore
to facilitate the diversification of the country's energy mix. Additionally,
electricity generation from renewable sources is environmentally
beneficial, as it decreases greenhouse gas emissions, produced as a
result of the combustion of fossil fuels.
However, Chile presents a complex energy situation, given the
important growth in electricity demand, the target goal for installed
capacity by 2020 outlined by the Government, the lack of technological
development, the high dependence on fossil fuels, and the low
diversification of its energy mix [1]. In this sense, the country is very
dependent on coal and natural gas, which represent a significant share
in power production, about 16% and 30%, respectively [2]. No matter
what is the route chosen for energy development in a country, it will
has become one of the main trends in sustainable energy growth in
developed countries and it represents major challenges for emerging
countries and more specifically for Chile [3]. The reforms in the
electricity industry implemented in Chile in the 1980's was based on
the private investments in the generation, transmission and distribu-
tion assets and led to a significant expansion of installed capacity.
However, the regulatory framework showed important weaknesses
when it faced adverse conjunctures such as the severe drought which
caused rationing of the electricity supply at the end of the 1990's, the
restrictions on the natural gas imports from Argentina and the reduced
hydrology which has affected Chile in recent years. For these reasons,
Chile underwent a transition towards coal and diesel oil power plants.
The complex energy situation does not respond to a long term strategic
planning. After more than three decades of unplanned growth, the
vulnerability of the electricity sector is evident [3].
In this context, NCRE can play a significant role in diversifying the
energy mix, improving the environmental impact of energy use,
improving the decisions to localize energy projects and granting greater
legal coverage in the process of approving new power plants. The
complexity of electricity systems with the growing need to incorporate

⁎
Corresponding author.
E-mail addresses: crmonroy@etsii.upm.es (C. Rodríguez-Monroy), gloria.marmol@gmail.com (G. Mármol-Acitores), gnilssonc@gmail.com (G. Nilsson-Cifuentes).

http://dx.doi.org/10.1016/j.rser.2017.08.059
Received 5 September 2016; Received in revised form 8 June 2017; Accepted 13 August 2017
Available online 31 August 2017
1364-0321/ © 2017 Elsevier Ltd. All rights reserved.
C. Rodríguez-Monroy et al.
Nomenclature
CDEC Centro de Despacho Económico de Carga
CDM Clean Development Mechanism
LNG Liquefied Natural Gas
MGS Generation means with installed capacity ≤ 9 MW
MSW Municipal Solid Waste
NCRE Non-Conventional Renewable Energy
the variables of competition, transparency, greater security of supply
and reliability in order enhance the development of clean and efficient
energy resources require the revision of the structures, functions and
roles of the different institutions involved [3]. Chile can face these
challenges successfully if it implements a strategy based on NCRE.
Taking into account that biomass represents 28.9% of the primary
energy matrix it can play a relevant role in achieving Chile's strategic
objectives considering the potential it offers as an abundant and
autochthonous resource [4,5].
Biomass is considered an NCRE, as it presents both renewable
characteristics due to its low environmental impact and non-conven-
tional characteristics given its relation with new technologies that are
still under development. The potential of this type of energy in Chile is
favored by the existing technical level in its forestry sector, the land
extensions that could be used for energy crops, as well as the large
amount of waste from forestry activities, lumber companies, agricul-
tural waste and solid municipal waste, among others. However, the use
of this type of energy through energy crops should be strategically
managed and regulated, in prudent and sustainable ways, considering
its potential impact on the production of food crops [6,7].
2. Background
2.1. Power generation status and demand coverage in Chile
In 2012, more than 65% of the primary energy and more than 55%
of the final energy in Chile were based on fossil fuels and oil products,
respectively. However, Chile only produces small quantities of fossil
fuels and oil products, importing more than 90% of the oil, natural gas
and coal it uses, as well as more than 45% of the oil-derived products
the country consumes [4].
The most important sectors in terms of final energy consumption in
the country are industry and mining (36.0%), transportation (30.7%),
and commercial and residential sectors (25.8%), while the sectors with
Fig. 1. National production and imports of fossil fuels (period 2001–2011).
938
Renewable and Sustainable Energy Reviews 81 (2018) 937–945
NEC National Energy Commission
NSWP National Solid Waste Program
SEIA System of Environmental Impact Assessment
SIC Central Interconnected System
SING Northern Interconnected System
UGM Unconventional Generation Means with installed capacity
< 20 MW
a higher electricity consumption correspond to industry and mining
(63.8%), and commercial and residential sectors (29.4%) [4]. In 2012,
the average contribution of domestic production for local consumption
of oil, coal and natural gas was 3.7%, 5.6% and 25.2%, respectively [4].
It is relevant to mention that a decline in the imports of natural gas
started in 2004 due to the crisis with Argentina, with import levels
reaching their lowest levels in 2008 [8]. However, with the liquefied
natural gas (LNG) regasification plants that were put into operation in
2009, the import levels of natural gas began to increase again (Fig. 1)
[8].
The countries that supplied Chile with fossil fuels and their
participation in 2011 were the following [9]:
a) Coal: Colombia (47%), USA (40%), Indonesia (7%) and Australia
(6%).
b) Oil: Brazil (43%), Colombia (18%), Ecuador (17%), Argentina
(10%), United Kingdom (8%) and Peru (4%).
c) Natural gas: Argentina (100%).
d) LNG: Guinea (34%), Trinidad and Tobago (31%), Qatar (16%),
Egypt (3%), USA (2%), Indonesia (2%), Yemen (1%) and others
(11%).
Although Chile still has a strong dependence from Argentina in
relation to the provision of natural gas, generating a country risk as it
happened in 2004, it should be taken into consideration that in 2011
imports of natural gas from Argentina represented just 7% of the total
amount of imported natural gas, where the remaining 93% was
obtained in the form of LNG from several countries, reducing, there-
fore, the geopolitical risk significantly. With respect to Chile's other
neighboring countries, such as Peru and Bolivia, it must be mentioned
that there is no infrastructure built or specific energy agreements with
them for fossil fuel imports to Chile, and international relations with
Peru and Bolivia are currently marked by natural boundary issues and
definitions of access to the sea. In December 2015, the country's net
C. Rodríguez-Monroy et al.
installed power by fuel type reached 19,586 MW, distributed by types
of technologies as detailed in Fig. 2 [10].
According to the figures presented by the Government of Chile [11],
the country's electricity demand between 1987 and 2006 doubled every
10 years. Due to this reason, the Government set the objective of
increasing the installed capacity by more than 8000 MW in 2020 [11],
in order to be able to meet the long-term demand, as well as
diversifying the country's power supply. In relation to this, the average
annual growth in installed capacity between 1998 and 2011 was 6%,
while the average annual increase in electricity demand was 5%.
During 2015 electricity demand was mainly covered by thermo-
electric plants powered by coal, natural gas or oil products (58.5%), and
conventional hydroelectric power plants (17.8%). NCRE covered the
remaining 23.7% of the annual demand, from which 15.4% corre-
sponds to NCRE hydroelectric power plants. The national gross energy
generation in the national interconnected systems, Northern
Interconnected System (SING), Central Interconnected System (SIC),
Magallanes, Aysén and Los Lagos, by NCRE in 2015 amounted to
16,962.11 GWh, as detailed in Table 1 [10,12].
Nowadays, Chile has the necessity of introducing changes, either
through the approval of new energy projects or through the introduc-
tion of regulations and subsidies, in order to promote renewable
energies and decrease the country's dependence on fossil fuels.
2.2. The electricity sector in Chile
Since 1982, as a result of the approval of the General Law of
Electrical Services - DFL Number 1, the Chilean electricity market has
introduced liberalization in the three main segments of its electricity
sector (generation, transmission and distribution), allowing the entry
of private companies in these activities, as well as establishing a
competitive market for generation, and defining a regulated market
for transmission and distribution. Later in 2004, Law Number 19,940
(Short Law I) was enacted with the aim of regulating the activity of
electricity transmission, ensuring power supply and improving the
interconnection between SING and SIC systems. In 2005 Law Number
20,018 (Short Law II) was approved in order to stimulate investment in
generation, through the introduction of a competitive tendering system
that ensured a price for a specified time period [13].
The power generation market in Chile operates under a system of
marginal economic dispatch, in which private companies maintain the
control over the type of technology used, the power plants’ capacities,
and their geographical location, among others, while the State is
responsible for regulating and supervising the sector. This market
ensures open access to the transmission network under non-discrimi-
natory conditions, allowing generating companies to access both the
energy sales contract market and the spot market [13]. Geographically,
the Chilean electricity sector is distributed in four independent systems
[10], as represented in Fig. 3:
1. SING, which supplies the mining industry, and is mainly based on
thermal energy. In late 2015 this system showed a net installed
power of 3953 MW and its extension includes regions XV, I and II.
2. SIC, which supplies 90% of the population and is mainly based on
hydro and thermal energy sources. In December 2015 this system
reached a net installed capacity of 15,468 MW, whose extension
spans from region III to region X. It should be mentioned that the
SING and SIC regions together comprise 99% of the country's total
installed capacity.
3. Aysén and Magallanes, which correspond to two smaller and
isolated systems in southern Chile, based on thermal, hydro and
wind energies. In late 2015, Aysen presented a net installed capacity
of 52.3 MW, while Magallanes showed a net installed power of
101.7 MW.
Additionally, it should be mentioned that Chile has two smaller
939
Renewable and Sustainable Energy Reviews 81 (2018) 937–945
systems, which correspond to the island of Pascua (4.3 MW) and Los
Lagos (6.9 MW). The major companies in each segment of the
electricity sector are structured as follows:
• Power generation: the sector is composed of various companies,
international holdings and its subsidiaries, whose market share in
December 2011 based on their net installed capacity was Endesa
(36.4%), AES Gener (19.4%), Colbún (15, 8%), and Suez Energy
(12.6%).
• Power transmission: the market share in December 2011
corresponding to the main companies considering its subsidiaries
based on the lengths of their transmission infrastructure with
voltage exceeding 33 kV in the SING and SIC regions was
TRANSELEC (31.6%), CGE transmission (16.7%), E-Cl (12.3%),
and AES Gener (8.8%).
• Power distribution: the market shares in December 2010
corresponding to the main companies considering their subsidiaries
based on the number of regulated customers were CGE (42.4%),
Chilectra (30.2%), Saesa (13.1%), and Chilquinta (11.1%).
Fig. 3 shows the administrative regions comprised in each of the
independent interconnected electricity systems.
In addition, the Chilean electricity market has one of the highest
energy prices in Latin America. The price for residential customers in
2010 was around 0.14 USD/kWh, which from late 2007 is higher than
the average price of OECD countries, as shown in the graph in Fig. 4
[14].
Based on the above and considering the objective of the State of
Chile of becoming a country which aims to overcome poverty and
underdevelopment, it becomes necessary to increase the capacity of
power generation during the next decade by using safe, clean and
economical energy sources, which would be coherent with a long-term
energy planning, according to the future needs of a country which
projects a sustainable annual growth of approximately 5%.
3. Main regulations in chile associated to NCRE
Regarding the legal aspects related to the development and
exploitation of NCRE, Law Number 19,940/04 (Short Law I) ensured
small generators whose installed power is lower than 9 MW the right to
connect to distribution networks, increasing, therefore, the options for
selling the power produced by these plants. Besides, the law introduced
an exemption from payment for use of the transmission system to non-
conventional generation means (UGM), with a differential treatment
for units with less than 9 MW and for units with an installed capacity of
9–20 MW.
Fig. 2. Net installed power in Chile (December 2015) [10].
C. Rodríguez-Monroy et al. Renewable and Sustainable Energy Reviews 81 (2018) 937–945

Table 1
Gross energy generated by the electricity system in 2015 – NCRE (GWh).

Non-conventional energy sources SING SIC Magallanes Ayseén Los Lagos Total

Hydro (< 20 MW) 77.83 10,951.21 0.00 94.51 2.91 11,126.46

Wind 232.22 1847.68 0.00 5.78 0.00 2085.67
Biomass 0.00 2389.88 0.00 0.00 0.00 2389.88
Solar 372.90 987.21 0.00 0.00 0.00 1360.10
TOTAL 682.94 16,175.97 0.00 100.29 2.91 16,962.11

Law Number 20,018/05 (Short Law II) allowed electricity distri-
buting companies to make contracts with generating companies for
power supply, based on open and transparent public tenders that led to
competitive prices, which were monitored by the National Energy
Commission (NEC) in order to ensure that the lowest energy price was
achieved. This law aimed at ensuring the power supply by distributing
companies, together with the establishment of a reference price band
and a regulation for retail prices. Complementary to this law, the State
approved the Regulation setting the conditions for connection and
operation of UGM and MGS (Decree Number 244/06), determining the
right for these generating plants to sell their energy at the marginal cost
(MC), and its power at the nodal price (Pnode), operating under an auto-
dispatch procedure and exempting UGM owners from full or partial
payment of the transmission charges.
While the above laws intended somehow to indirectly favor NCRE,
it was not until Law Number 20,257/08 that the State of Chile formally
demanded the use of this type of energies and the establishment of
long-term commitments with companies of the renewable sector
[15,16]. Therefore, Law Number 20,257/08 introduces amendments
to the General Law on Electricity Services with regard to electricity
generation from non-conventional renewable sources, requiring every
electricity company with an installed capacity higher than 200 MW to

Fig. 3. National electricity systems [10].

940
C. Rodríguez-Monroy et al. Renewable and Sustainable Energy Reviews 81 (2018) 937–945

Fig. 4. Evolution of electricity prices in the residential sector (period 2000–2010).

conduct withdrawals of electrical energy from the grid, in order to
supply it to distributing companies or end consumers, being these
subject to price regulation or not. This way generating companies must
prove to the “Dirección de Peajes del Centro de Despacho Económico
de Carga” (CDEC) that a certain percentage of the amount of energy
that has been injected into any electrical system in Chile during each
calendar year comes from non-conventional renewable sources. That
percentage increases progressively over time, being 5% for the years
2010–2014, and increasing by 0.5% annually, starting in 2015 with the
goal of reaching 10% by the year 2024. The law allows any utility that
exceeds the percentage previously described to transfer its generation
surplus to another utility, which can even operate in a different
electrical system within the country.
In order to comply with the previously described obligation,
companies may use any means of non-conventional renewable genera-
tion, which are a primary energy source, such as biomass, small hydro,
geothermal, solar, wind, marine and other generation means that use
renewable technologies for electricity generation, help to diversify the
power supply sources of the different electrical systems in Chile and
cause a low environmental impact. Intermittent NCRE generation will
increase rapidly in the future since a high proportion of the approved
NCRE projects are based on solar photovoltaic and wind technologies
[17]. Integration of these intermittent sources may represent a
challenge for the management of the electricity system.
According to Law Number 20,257/08 and its Exempt Resolution
Number 1248, the transfer procedure of energy surplus is assimilated
to a green certificate scheme (green certificates), since there is not a
predetermined price for the energy produced by renewable means
(feed-in tariffs), and because no prior bidding process is conducted in
relation to the production obligations with renewable resources.
Injections into the system with power coming from renewable
resources can be performed through self-generation, production pur-
chased from third parties or by buying certificates corresponding to the
amounts of required energy [15,18]. Law Number 20,698/13 (also
known as Law 20/25) modified Law number 20,257 and established
that starting in the year 2025, 20% of the power withdrawals by electric
price criteria.
With respect to liquid biofuels, Decree Number 11 of the Ministry
of Economy, Development and Reconstruction establishes the quality
specifications that this type of biofuels (bioethanol and biodiesel), as
well as their mixtures with conventional fuels (gasoline and diesel oil,
respectively), must comply with. Regarding gaseous biofuels and their
respective processes and uses, these are governed by different regula-
tions related to solid waste management, health codes, agricultural
protection, land use, gas services, transport and distribution conces-
sions for gas, electrical services and NCRE. In the case of projects that
manage municipal solid waste (MSW) in landfills, they must be subject
to the System of Environmental Impact Assessment (SEIA), and
additionally they shall comply with the legal requirements established
in the Constitutional Organic Law of Municipalities (Law Number
18,695), along with the regulations on health and basic safety condi-
tions in landfills [20].
Additionally, Chile has several development tools, aimed at sup-
porting the development of NCRE projects, among which 35 potential
development instruments stand out, corresponding to loans, grants
and funds, delivered by government and international agencies, as well
as tax benefits [19]. Moreover, renewable energy projects can be part of
the Clean Development Mechanism (CDM), associated with the Kyoto
Protocol, in case they are related to investments that reduce green-
house gas emissions in developing countries (countries not included in
Annex 1 of the Kyoto Protocol). Currently, there are several project
laws pending to be approved by the Chilean Congress [20,21]:
a) A change in Law Number 19,300, requiring projects of exploration
and exploitation of geothermal energy to be subject to the system of
environmental impact assessment.
b) A procedure to compensate energy withdrawals with energy pro-
Table 2
Percentage of NCRE required by laws 20,257 and 20,698 [3].
Year Law 20,257% increase Law 20,698% increase

utilities should come from renewable sources. Originally, the bill aimed 2014 5.0 6.0
at reaching that 20% by the year 2020, but due to the opposition of 2015 5.5 7.0
several sectors (among them the generating companies) the period was 2016 6.0 8.0
extended to the year 2025. The obligation to generate from NCRE 2017 6.5 9.0
2018 7.0 10.0
would increase stepwise annually as shown in Table 2 starting in the
2019 7.5 11.0
year 2015. The second modification that Law 20/25 introduced was a 2020 8.0 12.0
public tendering mechanism which would be activated in those cases in 2021 8.5 13.5
which it was anticipated that the NCRE projects under development in 2022 9.0 15.0
2023 9.5 16.5
a given year were not sufficient to meet the requirements of injected
2024 10.0 18.0
NCRE for that year. This public tendering would be neutral from the 2025 10.0 20.0
point of view of technology and would be awarded based strictly on

941
C. Rodríguez-Monroy et al.
duced by non-conventional renewable energy sources.
c) An amendment to Law Number 19,657 on geothermal energy
concessions.
d) An increase in the percentage of electricity generation through
NCRE.
e) A promotion of the development of NCRE.
f) The establishment of the payment of a special municipal tax when a
new generating power plant is installed.
g) The obligation for concession-holding companies to install and
connect net metering systems that facilitate domestic or residential
generation with NCRE by electricity consumers.
h) The creation of a national fund for the research and development of
biofuels.
i) The introduction of a scheme of wind energy rights.
4. Biomass. Advantages and drawbacks of biomass for
electricity generation
Biomass can be classified according to the product supplied and the
physical state in which this final product is presented:
1. Solid biofuels: Biomass products used in thermal applications (heat
and electricity).
2. Liquid biofuels: Biofuels used in the automotive industry, such as
bioethanol and biodiesel.
3. Gaseous biofuels: Products of the anaerobic fermentation of bio-
mass, forming biogas, which have CH4 and CO2, as their main
components.
The main features that are needed to evaluate the technical and
economic feasibility of an energy conversion process through biomass
are the following: type of biomass, chemical and physical character-
istics, moisture content, percentage of ashes, calorific power, density,
and harvesting, transportation and handling [1].
The fundamental processes related to biomass conversion are direct
combustion processes (direct burning of biomass for power generation,
gas and steam), thermochemical processes (transformation of biomass
into a higher value product, with a higher density and calorific power),
and biochemical processes (processes using both the biochemical
characteristics of biomass and the metabolic action of microorganisms
for the production of gaseous and liquid fuels, such as anaerobic
digestion and the production of alcohol fuels, liquid biofuels and
landfill gas) [1]. The main forms of energy obtained from biomass
are heat and steam, gaseous biofuels (biogas), liquid biofuels (bioetha-
nol and biodiesel), electricity, and cogeneration.
Electricity production from biomass presents several advantages
[13]:
1. It is a renewable source of energy that does not contribute to global
warming.
2. It mitigates the greenhouse effect by capturing methane gas from
landfills and agricultural waste.
3. Its combustion produces fewer ashes compared to natural coal
combustion, low levels of sulfides and can be used as well as an
organic fertilizer in soils.
4. Its power generation reduces significantly the problems of waste
management in forestry, agriculture and urban areas.
5. It is a local resource which is not subject to price fluctuations in
international fuel markets, thus reducing dependence and pressure
on the oil price.
6. Its use can stimulate rural economies, creating new jobs and income
options, as well as reducing economic pressures on agricultural
production and forestry.
On the other hand, power generation from biomass presents some
disadvantages as well [13]:
942
Renewable and Sustainable Energy Reviews 81 (2018) 937–945
1. It presents a low energy density, requiring high volumes of fuel to
generate power levels comparable with those produced by fossil
fuels.
2. An incomplete combustion produces organic matter, CO and other
harmful gases.
3. The combustion at high temperatures produces NOx, which con-
tributes to the production of acid rain.
4. Its caloric potential depends on the weather, moisture level and
density of the feedstock.
5. It is less efficient than energy produced from fossil fuels since it
presents lower heat capacities.
5. Biomass in Chile
Although the proportion is small, biomass is used in Chile for power
generation [2]. In December 2015 the net installed power associated
with biomass amounted to 346.9 MW [10], which generated 2.2% of
the gross energy generated in thermoelectric plants. Biomass in Chile is
presented in the three physical states: solid biofuels, liquid biofuels and
gaseous biofuels.
5.1. Solid biofuels
The development of solid biofuels in Chile is concentrated in the
south-central region of the country, due to the weather conditions,
forest plantations, the existence of native forests, high agroforestry
activity, characteristics of forest industrial area, and the need for
heating that the population has. Currently, power plants using biomass
as a primary fuel or using a mixture of biomass and oil products (black
liquor) have a net installed power of 218.5 MW [10]. These plants
belong mostly to companies associated with the forest and timber
sector producing their own electricity through cogeneration processes
and injecting their excess energy into the SIC electrical system because
of their geographical location.
Another aspect that favours this type of power generation is the
acquisition of biofuels from their production processes and waste,
achieving this way a reduction or exemption of their costs associated to
waste treatment, fuel transportation, and taxes on fuel purchases,
among others, and additionally with the possibility of issuing carbon
credits, which are associated with the Kyoto protocol. In this sense, the
rise in Chiles's industrial production and consumption has resulted in a
problem due to the increasing amount of solid waste produced. Even
though the use of the energy content of waste for power generation
through incineration represents a way of handling this growing
problem, the many impurities in the fuel make it difficult to generate
electricity from it [22]. Nonetheless, although the share in power
generation is not very significant, some power plants are fueled by
waste for electricity production [2]. Besides, in Chile, there is no
market for forest residues for power generation, which translates into a
limited energy market, where the activity of power generation does not
belong to the core business of most companies with this type of plants.
With regard to power generation projects using solid biofuels, in
August 2012 there existed three projects under construction, three
other projects that had already been environmentally approved, one
project under environmental evaluation, and one more project had
been rejected due to environmental reasons. These projects represent a
total of 284 MW and entail a total investment of 688 million US dollars
[21]. However, it should be mentioned that the power generated by
them will not be fully injected into the SIC electrical system, given that
the majority of companies are associated with the forestry sector so
that only the surplus energy will be injected into the system according
to their industrial processes. The potential for power generation using
waste biomass from the forests of Radiata pine and eucalyptus can be
estimated between 310 and 470 MW of installed electric power,
considering a utilization rate of 50% and 75% of the available biomass,
respectively. This potential is mainly concentrated in Regions VII, VIII
C. Rodríguez-Monroy et al.
and IX, where the forest industry is being developed and where the
largest areas of forest plantations are located [22].
Additionally, when considering the costs of availability and the
expenditures for the acquisition of feedstock, the variable cost of the
biomass used in the generation plant is estimated to be between
15.7 USD/ton to 20.9 USD/ton for average transportation distances
between 30 km and 60 km. Based on the above values, the equilibrium
energy prices for forest biomass projects would be between 65.8 USD/
MWh and 83.6 USD/MWh for plant sizes of 20 and 10 MW, respec-
tively, not considering any revenue from the sale of carbon credits.
Therefore, on the basis of the effects resulting from economies of scale,
power generation plants using forest biomass could be economically
viable for power levels equal to or above 10 MW [22].
5.2. Liquid biofuels
Liquid biofuels present a low level of development since the focus is
currently on research and on the execution of projects through which
new industrial pilot power plants have been gradually implemented.
Chilean agriculture has high yields for some crops that are susceptible
for the production of biofuels, such as rapeseed (Brassica napus L.)
and sugar beet [23]. However, the land surface suitable for biofuel
production is scarce considering the competition for food production
[7,24].
Law Number 20,339/2009 regulates the use of biofuels. Decree
number 11/2008 allows blending of biodiesel and ethanol with diesel
and gasoline respectively up to 2–5% and a previous regulation
(Circular Number 30) establishes that biofuels are tax-exempt [25].
However, Chile's climate is not adequate for the production of
sugarcane which is considered the main feedstock for the production
of ethanol and hence other crops, such as sugar beet, corn or wheat
have to be considered for this purpose [26]. The production of biodiesel
using sunflower and rapeseed as feedstock offers better possibilities
than the ethanol case [27]. Some low-cost feedstocks which can be
adapted to the soil and weather conditions of Chile offer a good
potential as an energy crop. This is the case of camelina which has been
studied for south central Chile [28].
While Chile is endowed with a suitable technical and professional
expertise within the agricultural sector, it has at the same time a major
limitation associated with the relative scarcity of arable farmland for
this type of biofuel, and this is the reason why it seeks the production of
second-generation liquid biofuels, such as those obtained from algae
and forest resources, in order to avoid competition for agricultural land
between food and energy crops [20,29,30]. The country also has
business technological pools dedicated to the activity of research and
development in the field of liquid biofuels, which are constituted by
public and private companies, universities, foundations and research
centers, and are currently working on the production of liquid biofuels
from lignocellulose, microalgae and macroalgae. These consortia
correspond to Biocomsa (lignocellulose), Bioenercel (lignocellulose),
Algaefuel (microalgae), Desert Bioenergy (microalgae) and Bal Biofuels
(macroalgae) [30].
Private initiatives based on first-generation liquid biofuels are still
waiting for subsidies and more favorable scenarios for investment. It is
expected that in a first stage, mixtures with imported liquid biofuels
will take place, whose position will depend on the level of the
international prices associated with these biofuels, as well as on the
local costs to produce them. In 2016, biodiesel and gasoline were
locally produced, both from pyrolysis and Fischer-Tropsch technolo-
gies, whose feedstock corresponds to forest residues [24]. Chile is
studying possibilities of producing second generation biofuel crops
such as wastes from eucalyptus and Radiata pine [28]. Other studies
and developments in the country are the ones performed by the Mayor
University, through a project associated with the production of
bioenergy from nopal farming. The University of Chile and the
University of Tarapacá separately are developing a way of obtaining
943
Renewable and Sustainable Energy Reviews 81 (2018) 937–945
biodiesel, on the basis of jatropha cultivation in non-qualified food
production lands located in the northern regions of the country.
Finally, the University of Chile, through its Domeyko Energy
Program, aims at optimizing the treatment of lignocellulose, in order
to obtain bioethanol [31]. New R & D projects on biomass conversion
technologies have to be promoted [24].
Regarding the production or industrial use of liquid biofuels, the
following four plants currently produce this type of biofuels [32,33]:
i) The FAME Plant of the Pullman Bus company, located in the
metropolitan area, with a production capacity of biodiesel of
100,000 l/month, an amount that is used exclusively by the
company.
ii) The research pilot plant for the production of biodiesel from
rapeseed developed by the University of La Frontera and several
private companies, which is located in the IX region and develops
the whole production chain for the elaboration of biofuel.
iii) The Ingras company plant, located in the metropolitan region and
responsible for the production, storage and marketing of biodiesel,
which is generated from recovered oil and grease, having a
production capacity of 1,000,000 l/month.
iv) Experimental pilot operated by the Clean Energy Company, which
captures CO2 and NOx for biodiesel generation through the
cultivation of microalgae. This plant is located in the V region
and its inputs come from the Ventanas smelter and refinery.
5.3. Gaseous biofuels
The development of gaseous biofuels in Chile is focused on the
extraction and use of biogas, concentrated in areas with a large
population that generates high volumes of household and industrial
waste, and in areas with significant agricultural activity [34]. In this
sense, among Latin American countries, Chile is the leader in terms of
end-disposal of waste by landfill, with a national coverage of 83%
[35,36]. However, nowadays most of this waste is deposited in sanitary
landfills and is not treated further. Just a few landfills have landfill gas
collection where the gas is flared directly [2] and, even though a
substantial improvement in design, construction and exploitations of
landfills has taken place, Chile's landfills continue to present consider-
able functional problems, with cases of pollution related to design and
exploitation [2,35,36]. Since the need for landfills is going to continue
in the future, measures need to be taken in order to improve the design
of new facilities [37]. In 2010 biogas plants both in operation and
under development were owned by agricultural, agribusiness, sewage
and landfill companies [38]. However, according to the information
available at the National Energy Commission in December 2011 just
the KDM company, which belongs to the sector of management and
disposal of municipal solid waste (MSW) in landfills, would be
generating electricity with its Loma Los Colorados power plant [10],
that aims at having an installed capacity of 28 MW by the year 2024
[39].
Regarding the power generation projects using biogas, in late 2011
the only project associated with biogas from landfills was approved.
This project presents an installed power of 14 MW, expandable to
20 MW in the period of maximum biogas generation. It required a total
investment of 36 million US dollars and started operation during the
year 2013 [21,40]. Furthermore, the owner of this generating plant
owns landfills for biogas extraction among its assets. By 2009 the
potential of biogas generation from municipal solid waste in Chile
increased to 217.3 million m3/year, while it is estimated at 236.9 mil-
lion m3/year by the year 2019, as a result of the increase in the
country's population [19]. This potential would be obtained from
dumps and landfills mainly located in the central-south region of the
country, due to the demographic, climatic and social characteristics of
this area [33]. On the basis of such potential, it could be possible to
generate between 332 GWh/year and 362 GWh/year. Moreover, the
C. Rodríguez-Monroy et al.
potential of biogas in the country considering substrates, such as pig
manure, cattle manure, poultry manure, forest wastes, sludge farming,
crop waste and agro-industrial waste, amounts to 4190.4 GWh/year,
with the highest concentration of the potential being located in the
central-south region of the country as well, and more specifically in the
Metropolitan, VI and X regions [34,38].
However, even though there are different feasible possibilities for
biogas generation and use, due to the high agricultural activity, the
country's population growth rate, and the National Solid Waste
Program (NSWP), among others, biogas has not registered a substan-
tial increase in its development yet, particularly because of the
existence of a low level of uptake and production in relation to the
high potential available, where a high proportion of the captured biogas
is burned without being employed for energy generation due to both a
lack of knowledge and technical expertise [20,39]. In Chile, anaerobic
technology has been introduced recently and only on a very small scale
although the potential for this energy source derived from the digestion
of manure and crop residues is considerable. Estimates indicate that
less than 2% of the current potential is achieved [41]. On the other
hand, the use of crop residue for power generation through the
production of biogas is an adequate approach which also entails
environmental benefits. However, as already indicated, the constraints
on suitable arable land in Chile make it difficult to shift from food
production to energy crops [42].
6. Conclusions and recommendations
Even though Chile presents a high potential for the development
and production of energy using both solid and gaseous biofuels, there is
a low share of power generation from these types of biomass, as well as
a shortage of future projects, both in magnitude and in number.
Regarding liquid biofuels, their R & D & I must continue being devel-
oped in order to improve second-generation products, as well as the
specific processes for their industrial development, with the aim of
enabling the production of these fuels at massive levels and their stable
incorporation into the country's transportation system.
Chile has a strong need for the diversification of its energy mix,
through the incorporation of NCRE sources, in order to reduce its
dependence on fossil fuels and their externalities, and from the climate
risk related to hydroelectric power production (dry and wet years).
With the diversification of its power generation mix, Chile could reduce
future risks and costs, which might be detrimental to the country's
development, being in a good position for achieving the target goal of
installed capacity set by the State for the year 2020.
Furthermore, while the State of Chile is undergoing legislative
changes aimed at promoting and supporting the development of NCRE
sources, it should continue encouraging and fostering energy genera-
tion from renewable and sustainable energy sources which could
compete with conventional energy sources, by means of incorporating
regulations, subsidies, restrictions and funds, among others, in order to
attract new investment in the sector. The dynamics presented by the
Chilean electricity sector due to the growing incorporation of NCRE
projects translates into the challenge of implementing new mechanisms
to adapt to the new situation. The goal should be to obtain the low
prices and the environmental advantages of NCRE while avoiding the
risk transfers to conventional energy sources.
Given the characteristics, as well as the safety and technical
conditions that are present in Chile, the country should seek greater
incentives to stimulate foreign investment and specialised technical
expertise, in order to enable a substantial leap in the field of electricity
generation using NCRE sources and the sustainable use of the country's
natural resources, including new investments in the electricity sector,
technical training, innovative and efficient projects, new renewable
energy-generating companies and environmental institutions.
944
Renewable and Sustainable Energy Reviews 81 (2018) 937–945
References
[1] Biomass User Network (BUN-CA) y Programa de Naciones Unidas para el
Desarrollo (PNUD), Manuales sobre energías renovables – Biomasa, 1ª edición,
Costa Rica; 2002.
[2] Gebremedhin A, Karlsson B, Björnfot K. Sustainable energy system – A case study
from Chile. Renew Energy 2009;34:1241–4.
[3] García-Pizarro R. La generación eléctrica a partir de energías renovables no
convencionales en Chile. In: Altomonte H, editor. Las energías renovables no
convencionales en la matriz de generación eléctrica: tres estudios de caso. Santiago
d Chile: CEPAL; 2017. p. 83–100.
[4] Official website Ministry of Energy. Balance Energético 2012. Retrieved February
from (〈http://antiguo.minenergia.cl/minwww/opencms/14_portal_informacion/
06_Estadisticas/Balances_Energ.html〉.
[5] Román-Figueroa C, Montenegro N, Paneque M. Bioenergy potential from crop
residue biomass in Araucania Region of Chile. Renew Energy 2017 31;102:170–7.
[6] IEA, International Energy Agency. World energy outlook; 2016.
[7] Román-Figueroa C, Paneque M. Ethics and biofuel production in Chile. J Agric
Environ Ethics 2015 1;28(2):293–312.
[8] Official website Ministry of Energy. Balance Energético 2008. Retrieved February
from (〈http://antiguo.minenergia.cl/minwww/opencms/14_portal_informacion/
06_Estadisticas/Balances_Energ.html〉).
[9] Comisión Nacional de Energía (CNE). Importaciones de Hidrocarburos. Retrieved
August 2012 from (〈http://www.cne.cl/estadisticas/energia/hidrocarburos〉).
[10] Comisión Nacional de Energía (CNE). Estadísticas de Electricidad 2015. Retrieved
February from (〈http://www.cne.cl/estadisticas/energia/electricidad〉).
[11] Álvarez R. Presentación al Senado Chile y los dilemas de su política energética,
September 2011, Ministry of Energy; 2011.
[12] Central Energía. Generación SING y SIC. Retrieved February from (〈http://www.
centralenergia.cl/generacion/〉).
[13] Saldías H, Ulloa H. Evaluación comparativa de centrales de generación de energías
renovables mediante la aplicación de la nueva ley de energías renovables
recientemente aprobada en Chile. Chile: Pontificia Universidad Católica de Chile;
2008.
[14] Álvarez R. Presentación a Sofofa La encrucijada energética de Chile: Los desafíos
del desarrollo, October 2011, Ministry of Energy; 2011b.
[15] Urzúa IA, Olmedo JC, Sauma EE. Impact of intermittent non-conventional
renewable generation in the costs of the Chilean main power system. Renew
Sustain Energy Rev 2016;60:810–21.
[16] Marambio R, Rudnick H. A novel inclusion of intermittent generation resources in
long term energy auctions. Energy Policy 2017 31;100:29–40.
[17] Grágeda M, Escudero M, Alavia W, Ushak S, Fthenakis V. Review and multi-criteria
assessment of solar energy projects in Chile. Renew Sustain Energy Rev 2016
30;59:583–96.
[18] Fuentes F. Energías Renovables: Políticas de Fomento en Chile, 15/11/2011;
2011. 〈http://fen.uahurtado.cl/wp-content/uploads/2010/07/I-267.pdf〉.
[19] Gamma Ingenieros SA. Estudio para la Comisión Nacional de Energía Análisis
estratégico de elementos de política para biogases combustibles en Chile, No. 610-
48-LE09, Chile; 2010.
[20] Cámara de Diputados de Chile, Proyectos de Ley de Energía. 〈http://www.camara.
cl/pley/pley_buscador.aspx〉.
[21] Central Energía, Proyectos de Generación en Chile. 〈http://centralenergia.cl/
proyectos/〉.
[22] Bertran J, Morales E. Potencial Biomasa Forestal. Chile: Comisión Nacional de
Energía and Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH;
2008.
[23] Iriarte A, Rieradevall J, Gabarrell X. Transition towards a more environmentally
sustainable biodiesel in South America: the case of Chile. Appl Energy 2012
31;91(1):263–73.
[24] García AE, Carmona RJ, Lienqueo ME, Salazar O. The current status of liquid
biofuels in Chile. Energy 2011 30;36(4):2077–84.
[25] Cremonez PA, Feroldi M, Feiden A, Teleken JG, Gris DJ, Dieter J, de Rossi E,
Antonelli J. scenario and prospects of use of liquid biofuels in South America. Curr
Renew Sustain Energy Rev 2015 31;43:352–62.
[26] National Institute of Statistics . Results of the national agricultural survey. Santiago
de Chile: Oficina de Estudios y Políticas Agrarias and Centro de Información de
Recursos Naturales; 2008.
[27] CATA – Centro Avanzado de Tecnologías Agrícolas . Evaluation of the productive
potential of biofuels in Chile based on traditional agricultural crops. Valparaiso:
Departamento de Industrias, Universidad Técnica Federico Santa María; 2007.
[28] Avinash A, Subramaniam D, Murugesan A. Bio-diesel—A global scenario. Renew
Sustain Energy Rev 2014 31;29:517–27.
[29] Gabinete Ministerial y Unidad de Bioenergía de la Oficina de Estudios y Políticas
Agrarias (ODEPA) del Ministerio de Agricultura, Contribución de la política
agraria al desarrollo de los Biocombustibles en Chile, Chile; 2007.
[30] Arriaza J, Presentación Estado actual de los biocombustibles en Chile, Ministerio
de Energía, División de Energías Renovables no Convencionales; 2010.
[31] Boza S. Políticas y capacidades de I & D e innovación, para el desarrollo de los
biocombustibles en Colombia y Chile. Comisión Económica para América Latina y
el Caribe (CEPAL) y Oficina Regional para América Latina y el Caribe de la
Organización de las Naciones Unidas para la Agricultura y la Alimentación (FAO);
2011.
[32] Colegio de Ingenieros Agrónomos de Chile, Plantas de biocombustibles líquidos.
Retrieved from (〈http://www.ingenierosagronomos.cl〉).
[33] Nilsson G. Trabajo fin de máster “Factibilidad de generación de energía eléctrica
C. Rodríguez-Monroy et al.
en Chile a partir de biogás de residuos sólidos domiciliarios (RSM)”. España:
Universidad Politécnica de Madrid; 2012.
[34] Bidart C, Fröling M, Schultmann F. Livestock manure and crop residue for energy
generation: macro-assessment at a national scale. Renew Sustain Energy Rev
2014;38:537–50.
[35] Calvo F, Moreno B, Ramos A, Zamorano M. Implementation of a new environ-
mental impact assessment for municipal waste landfills as tool for planning and
decision-making process. Renew Sustain Energy Rev 2007;11:98–115.
[36] Calvo F, Szanto M, Muñoz J. Situacion del manejo de residuos sólidos urbanos en
América Latina y el Caribe. Residuos Rev Técnica 1998;43:70–6.
[37] Taulis . H.E.L.P. for landfill design in Chile. DevNet NZ Research: Lincoln
University: Resource Studies; 2002. p. 2000–4.
[38] Gamma Ingeniería, Estudio para la Comisión Nacional de Energía Modelo de
945
Renewable and Sustainable Energy Reviews 81 (2018) 937–945
negocios que rentabilicen aplicaciones de biogás en Chile y su fomento, No.
584105-8-LE10; 2011.
[39] Servicio de Evaluación Ambiental, Proyecto Central Loma Los Colorados.
Retrieved February from (〈http://seia.sea.gob.cl/documentos/documento.php?
IdDocumento=3997977〉).
[40] Servicio de Evaluación Ambiental, Proyecto Central ERNC Santa Marta. Retrieved
February from (〈http://seia.sea.gob.cl/documentos/documento.php?
IdDocumento=5705387〉).
[41] Chamy R, Vivanco E. Identification and classification of different sort of biomass
available in Chile for biogas generation. Santiago, Chile: National Commission of
Energy; 2007, [in Spanish].
[42] Chile Ramirez N. Evolution of biofuels in Chile. USDA Foreign Agricultural Service.
Global Agricultural Information Network; 2012.