Decarbonizing the Chilean Electric Power System: A Prospective Analysis of Alternative Carbon Emissions Policies

Abstract

In this paper, we investigate potential pathways for achieving deep reductions in CO2 emissions by 2050 in the Chilean electric power system. We simulate the evolution of the power system using a long-term planning model for policy analysis that identifies investments and operation strategies to meet demand and CO2 emissions reductions at the lowest possible cost. The model considers a simplified representation of the main transmission network and representative days to simulate operations considering the variability of demand and renewable resources at different geographical locations. We perform a scenario analysis assuming different ambitious renewable energy and emission reduction targets by 2050. As observed in other studies, we show that the incremental cost of reducing CO2 emissions without carbon capture or offset alternatives increases significantly as the system approaches zero emissions. Indeed, the carbon tax is multiplied by a factor of 4 to eliminate the last Mt of CO2 emissions, i.e., from 2000 to almost 8500 USD/tCO2 in 2050. This result highlights the importance of implementing technology-neutral mechanisms that help investors identify the most cost-efficient actions to reduce CO2 emissions. Our analysis shows that Carbon Capture and Storage could permit to divide by more than two the total system cost of a 100% renewable scenario. Furthermore, it also illustrates the importance of implementing economy-wide carbon emissions policies that ensure that the incremental costs to reduce CO2 emissions are roughly similar across different sectors of the economy.

Commentary and critical discussion on ‘Decarbonizing the Chilean Electric Power System: A Prospective Analysis of Alternative Carbon Emissions Policies’

“…Comparing the findings of Babonneau et al [1] to this existing body of literature would have been essential to show whether the obtained results were in line to the published ones, or if they shed light on new findings that might have not been previously reported.…”

“…In general, a comprehensive and critical literature review of available methods and case studies in the field is fundamental not only for providing an appropriate background to the readers but also to have a solid foundation on which to discuss and build new knowledge. Babonneau et al [1] did include several articles on 100% RE system models applied to different parts of the world, namely Europe [2], France [3], Germany [4], Canary Islands [5], Japan [6], and Columbia [7]. However, they failed to identify all previously published articles on 100% RE analyses for Chile, which we count to be at least seven.…”

“…However, they failed to identify all previously published articles on 100% RE analyses for Chile, which we count to be at least seven. Refer for example, to the planning exercises on Chile's electricity system [8][9][10][11][12] and the work that also addressed the power, heat, transport, and desalination sectors [13,14], while an even more comprehensive study investigating different scenario options and utilising sector coupling features [15] has been published in the same month that Babonneau et al [1].…”

“…We would like to thank the authors Babonneau et al [1] of "Decarbonizing the Chilean Electric Power System: A Prospective Analysis of Alternative Carbon Emissions Policies" for their efforts into understanding alternatives to decarbonize and reach a 100% renewable-based electricity system in Chile, which is essential for mitigating climate change. In summary, Babonneau et al [1] simulate the evolution of the power system using a long-term planning model that identifies investments and operation strategies to meet demand and CO 2 emissions reductions at minimum cost. The used model considers representative days to simulate operations and analyse scenarios with different renewable energy (RE) and emission reduction targets by 2050, including carbon capture and storage (CCS) technologies.…”

Editorial - International Journal of Sustainable Energy Planning and Management Vol 36

“…A 2021 paper on the Chilean electricity system [5] is the starting point for Osorio-Aravena and co-authors' commentary [6] in this issue of the International Journal for Sustainable Energy Planning and Management. Osorio-Aravena and co-authors point to a lack of consideration for previous work in the commented paper, and that due to methodological limitations and age of data, e.g., the contribution of photovoltaics is "2.7 to 16 times less than other existing studies for the region".…”