German firm bets on Chile’s potential for SAF from renewables

opinion

by Fayaz Hussain

July 10, 2024

From the scorching sun of the Atacama Desert to the windswept plains of Patagonia, Chile there is a goldmine of clean energy potential. Beyond the powerful winds, Chile can tap into the power of surging ocean currents, hidden geothermal pockets and the rushing rivers that carve through its central and southern regions.

The country already produces 58% of its electricity from renewable sources. It has committed to carbon neutrality by 2050. With a National Hydrogen Strategy in place, the South American country wants to be a frontrunner in green hydrogen production and export.

According to GH2, a Swiss non-profit green hydrogen foundation, Chile could produce up to 1.6m tonnes per year of green hydrogen.

With these ambitious renewable energy plans, the parent company of Chile’s leading fuel distributor Copec invested in German power-to-fuels technology firm Ineratec earlier this year.

The plan was to tap into the developing hydrogen industry and use renewable energy sources to develop e-fuels. Last month, the two companies announced their plans to develop a 3,500t e-fuel plant in Chile, with potential to develop a lot more sites.

Ineratec is a German power-to-liquid firm developing modular technology to produce e-fuels using power-to-liquid pathways. It spun out of a university project by founder Tom Boeltken, who thinks it is possible to scale e-fuel production needed to meet the upcoming demand by strategic investment in regions where these challenges can be addressed at a low cost.

Boeltken thinks that Chile has all the right ingredients to scale e-fuels production. “As an e-fuel producer, you are actively looking for sweet spots where you have access to cheap green hydrogen and green electricity. And Chile has both,” he tells SAF Investor.

“And so with our strategic partnership with Copec, we are now aiming to, roll out our technology in Chile in the next two years.”

Ineratec has developed and deployed modular fuel synthesis technology which efficiently converts green hydrogen, renewable electricity and CO2 into e-fuels. But the company said it is partnering with Copec on the project to expedite the development.

“Ineratec itself can be both. We can be a classical OEM, like a technology provider, but we also look for opportunities to develop our own build,” says Boeltken. “We have seen that when you enter in a project, you can accelerate it, because you can actually determine the speed, but it cannot be done without local partners.”

Moreover, he says that working as co-developers, they can de-risk the projects very fast and quickly deploy technology.

“And what differentiates us from our competitors is that we are not betting on standalone, large-scale plant only. But our technology is very compatible with the upstream technology, namely electrolyzers or carbon capture technologies. And this brings us into position to roll out our technology very fast,” adds Boeltken.

He says that this project can become a blueprint to scale eSAF production across Chile. A study carried out by H2Upp, International Hydrogen Ramp-up Programme run by German government in partnership with the private sector, found that the country has potential to develop 10 sites which can meet domestic and global e-fuel demand.

Maybe, Patagonia might just be the wind in the sails of e-fuel producers feeling a bit deflated and not just a fancy vest for their investors.