Up to 60% for each awarded project with a cap of 10 million dollars will be borne by the Corporation to install electrolysis capacity, while the Technology Center will seek to contribute to knowledge transfer, human capital development, and the industry's local value chain in the Magallanes region and the country as a whole.

Following the presentation of the Green Hydrogen Action Plan (H2V) weeks ago, Chile's Production Promotion Corporation (Corfo) announced two initiatives that seek to give new impetus to the sustainable development of this industry in Chile .

First, the launching of requests for proposals (RFP) for the manufacturing and/or assembly of electrolyzers and their components in Chile. And, second, the opening next June of the tender to create the Technological Center for Innovation in Green Hydrogen of Magallanes, the first of its kind in the country, which aims to provide scientific-technological support and develop human capabilities to this new industry.

“Both instruments are part of the roadmap that was being worked on between the public and private world in the Corfo Transform H2V Program and that today are reflected in the Magallanes Collaboration Protocol between local development companies, and the Central and Regional”, explained José Miguel Benavente, Executive Vice President of Corfo.

Benavente added that the Technology Center is an initiative that is also part of the Sustainable Productive Development Program (DPS) led by the Ministry of Economy and financed by Corfo. The RFP for the manufacture of electrolyzers will be financed with resources from the contracts for the exploitation of the Corporation's lithium assets in the Salar de Atacama, intended to promote the development of capabilities, technology transfer, innovation, or other enabling processes for green hydrogen and its derivatives.

Pact of Magellan

The announcements were made within the framework of a new session of the Magellan Pact, attended by the ministers of Economy, Development and Tourism, of Education, and of Labor and Social Welfare, as well as the Undersecretary of Energy, in addition to local authorities and representatives of the private sector linked to the green hydrogen industry.

“Magallanes and the country have a tremendous opportunity with the development of Green Hydrogen. Today it is up to the authorities to ensure that this feasibility is possible in the coming years and generates a positive impact for our population,” said Jorge Flies, Governor of the Magallanes Region.

For his part, the Minister of Economy, Development and Tourism, Nicolás Grau, said that “it is important to grow and see what the main mechanisms will be for our economy to develop with strength and dynamism in the coming decades, and there hydrogen Green plays a fundamental role and Magallanes, in particular, will have undisputed leadership in this matter in Chile and in the world.”

And he added that “what is needed for the tremendous opportunity of green hydrogen to generate quality jobs, generate productive chaining, that is, for SMEs to be able to participate strongly in this and, ultimately, generate development and progress in Magallanes. What is required is precisely what we had in today's meeting, in which we sat at a table, analyzed the infrastructure problems with the private sector, analyzed the tremendous opportunities and worked on this public-private alliance that is a hallmark of this government. in order to take advantage of this development opportunity.”

The Minister of Education, Nicolás Cataldo, revealed that “we are very happy to have the historic opportunity to modulate and shape a process of training people, of generating human capabilities, in a territory that will see an expansion of its productive, economic and also professional and personal development capacity.”

Regarding the role of the Ministry of Education in this initiative, Minister Cataldo maintained that it will be his responsibility to lead “what efforts the educational sector is going to make to align the offer and training, both in technical-professional secondary education and in university professional, to meet development objectives.”

For her part, the Minister of Labor and Social Welfare, Jeannette Jara, praised the initiative. “I think it is important to highlight the effort being made in Magallanes to lead this process of generating new energy sources from the collaboration between public and private sectors. I point this out because these are medium-term processes and many times contingency and politics consume us every day, but here we are working on a project for the region for the country, which is one of greater growth. And in this, the leadership of Governor Jorge Flies has been fundamental and I highlight it because, since the signing of the Magellan Pact, led by the President of the Republic, it seeks to address different problems that have been present in the region."

Finally, the Undersecretary of Energy, Luis Felipe Ramos, emphasized that “the development of the green hydrogen industry is fundamental to achieving our goals of carbon neutrality, decarbonization and the energy transition, and is important to achieve greater diversification and sophistication of our industry and our sustainable productive development. For this reason, we have developed a state policy, which is a priority for President Boric's government. This priority is materialized on the one hand in the Green Hydrogen Action Plan, and is also expressed in the Magellan Pact, which brings together different authorities and project developers to show the progress necessary to promote this industry in the region."

The H2V Technology Center in Magallanes

“The National Hydrogen Strategy and its 2023-2030 Action Plan seek to encourage the transfer of knowledge and contribute to the development of the green hydrogen industry. In this context, in recent years Corfo has had more than a dozen incentive instruments of different natures available to support the development and consolidation of a clean hydrogen industry to cover internal demand and achieve our decarbonization goals and at the same time supply international markets,” said Corfo's head.

The Technological Center for Innovation in Green Hydrogen in Magallanes will have the mission of encouraging and accelerating the adoption and development of products and services based on R&D&i through piloting, scaling and training of human capital that respond to the needs of the new industry.

Institutions that apply for co-financing of up to US$6.6 million (in six years) must propose strategic plans that allow the center to be established and projected over time as a “reference in the promotion and development of advanced technologies related to production, storage, distribution and applications of green hydrogen, its derivatives and its production chain, playing a central role in the decarbonization of strategic productive sectors within the framework of sustainable productive development of the region and the country.

National legal entities that have the critical capabilities for the execution of the nominated initiatives may apply, such as technology centers, universities and/or technology-based companies, responsible to Corfo for the execution of the project. The participants of the selected proposal must contribute to the co-financing of the project through pecuniary and/or valued contributions.

The award will be announced in November of this year.

Electrolyzers in Chile

According to a study commissioned by the IDB and the Ministry of Energy, considering the projects in the portfolio announced by the companies, approximately 12.8 GW of electrolysis capacity will be installed by 2030 between Antofagasta and Magallanes. Meanwhile, the World Bank and the Hydrogen Council estimate that an increase of 40 to 45 million tons in the global supply of low-emission hydrogen is expected for the same year, but global capacity for manufacturing and assembly of electrolyzers must increase in order to reach these figures.

The current manufacturing capacity of these fundamental components for the production of the H2v amounts to about 19 GW per year, of which around 40% is in China. According to IEA estimates, global manufacturing capacity could reach between 130 and 155 GW per year by 2030.

25% of the expansion plans have not indicated the specific location of the plants, which means that the geographical distribution could vary depending on support policies to stimulate demand and local manufacturing of electrolyzers, progress in the development of projects large scale, strategic positioning in emerging markets, among other factors.

In 2023, Corfo launched a call for information (RFI) and received six expressions of interest for the installation of electrolyzer manufacturing plants of between 500 to 1,000 MW of capacity per year, with estimated investments between US $50 million and US$100 million in alkaline electrolyzer (ALK), proton polymeric membrane (PEM) and solid oxide (SOEC) technologies.

Benavente explained that Corfo is now calling for the second phase of this initiative, which is the receipt of specific proposals for the installation of factories and assemblers of electrolyzers and their components on national soil. The aim includes to create opportunities for national companies interested in integrating to this new business area through associations with more than 50 international firms of different scales that exist in this market today. We will thus address one of the actions defined in the Roadmap of the Transforma Magallanes Program. We have seen that large-scale plants already under construction in the world have installed electrolyzers from various suppliers, we believe that developers in Chile will do the same.”

With this new call, Corfo seeks in the first year of implementation to have the feasibility and environmental impact studies, as well as the identification of supply chains and potential clients. In a second stage, the factories are expected to enter the SEA, along with engineering studies and commercial agreements that make the project viable, and then move on to the consolidation stages for the first plants already operating in a horizon that does not exceed 5 years..

Corfo will allocate co-financing of up to 60% for each project with a cap of US$ 10 million.