Business Advisory, Energy Tagged

Chile Coal-Fired Generation Exit Update

Chile is making strides in transitioning away from coal-fired power plants. In recent years, the Chilean government has been implementing policies to phase out coal and increase the share of renewable energy sources in its energy mix.

In 2021, renewables contributed on average over 25% of the electrical demand for the national grid. This has risen considerably since with a wave of projects that were built pushing renewables share of the energy matrix to over 30% for 2022. Today, it is closing in on 40%, with the next wave of development coming in the form of battery storage.

In 2019, led by Chile’s late President Sebastian Piñera, the country commited to shutting down all of its coal-fired power plants by 2040. This decision was part of Chile’s broader commitment to combat climate change and reduce its greenhouse gas emissions.

Since then, the timeframe has been shortened and the transition accelerated. The new goal is to close all 28 coal powerplants by 2030, 10 years sooner then orignaly projected, and there is a chance that it could be accelerated even more.

According to a report from the environmental group Chile Sustentable, between 2019 and 2022, eight coal-burning power plant units were shut down: Italian utility company Enel closed three units, France’s Engie closed four units, and AES Andes (formerly known as AES Gener) shut down one plant.

Of the 20 remaining units, 12 have a closure or conversion date set or pending; these units either have a scheduled date to close or switch to a different fuel (biomass or natural gas), or they await a response by January 2025 from the national energy commission to a requested closure.


  • Chilean power generator Engie Energía, a subsidiary of French Engie, has already retired almost 440MW of coal-fired capacity in Chile and 334MW is due to be taken offline by the end of 2025.
  • Engie has assigned an estimated US$75mn in capex for coal-fired power plant conversion work in 2024-25. The company is aiming to convert around 700MW of coal-fired capacity by the end of 2026 to gas and biomass.
  • Conversion work targets 377MW power plant Infraestructura Energética Mejillones (IEM) and generation units Andina (CTA) and Hornitos (CTH), with a combined 356MW. 
  • Engie Energía will convert IEM to gas, a project with an environmental license. The company has also been given the environmental permits to convert units CTA and CTH to biomass. 
  • In 2018 – Engie’s power generation portfolio was 1.9GW, comprising coal (58%), gas (33%), diesel (8%) and renewables (1%). By 2026, the portfolio is forecasted to reach 3.4GW, comprising renewables (59%), gas (29%), biomass (10%) and diesel (2%).


  • Prior to the agreement to remove coal powerplants, installed coal-fired generation capacity in Chile was 5.53GW, with AES Gener accounting for 54.6%of that total.
  • The AES Andes coal-fired asset portfolio prior to the start of the decarbonization drive comprised Angamos (two units, of 277MW and 281MW gross capacity), Cochrane (two units, of 275MW gross capacity each), Nueva Tocopilla (two units, of 141MW of gross capacity each), Guacolda (five units, three of 154MW gross capacity, one of 145MW and one of 156MW) and Ventanas (four units, of 114MW, 208MW, 267MW and 272MW gross capacity).
  • Ventanas – AES Andes recently retired unit No. 2 of its four-unit Ventanas coal-fired power station complex in Valparaíso region. The retirement of the 208MW facility unit follows that of the 114MW No.1 unit in 2022. The remaining two, known as Nueva Ventanas and Campiche, respectively, are penciled in to be closed by April 2029. 
  • Guacolda – In 2021, AES Andes sold its stake in the five-unit Guacolda complex in Atacama region, giving local generator Guacolda Energía full ownership of the 760MW facility. Guacolda plans to start co-firing with green ammonia from 2030
  • Cochrane – The two-unit Cochrane complex of 490MW in Antofagasta region is operational. A provisional closure date is pending. 
  • Angamos –  AES Andes has been given environmental approval to convert units 1 and 2 of the Angamos coal-fired thermoelectric power plant, located in northern Chile, into an energy storage system using molten salts. These salts will be directed to the steam generator where they will exchange heat with the water, generating the necessary steam to reach a power of 560 MW with both units in operation. The US$450mn plan to convert Angamos to a 560MW molten salt energy storage facility with six-hour injection capacity is expected to be online by the end of 2026. 
  • Most recently, AES Andes was given the green light by the national energy commission to take offline the two units of its 276MW Norgener complex in Antofagasta region as of March 31 2024. 


  • Enel became the first company in the country to disconnect all of its coal-fired power units. The company previously operated the Tarapacá plant, which had one 158-megawatt unit, and the Bocamina plant in Coronel, which had two units with capacities of 130 megawatts and 348 megawatts. Together these accounted for 11.5% of the country’s total installed coal power capacity. The Bocamina site in Coronel is now being considered for potential repurposing of assets, including the possible use of molten salt technology.


  • Out of Chile’s original fleet of coal-fired power plants, Colbún owns just one – the single-unit Santa María de Coronel plant in the Biobío region. This 370MW plant, which began operating about a decade ago, accounts for 6.7% of Chile’s original coal fleet. Colbún has not disclosed any plans regarding the future of the Santa María de Coronel power plant.


Chile is well on its way to close its coal fired power plants 10 years ahead of schedule. The energy sector is the country’s largest emitter, making up almost 80% of total CO2 output. Just changing this one industry will have a huge effect on the countries overall carbon output.

Chile is in a unique position. It has been able to take transform its energy matrix in a very short period. The growth of renewables has also uncovered weak points that needs to be addressed if the sector will continue to grow. Battery storage and transmission capacity are at top of the list to help solve these issues. Both issues are being solved with a steady stream of battery storage projects and new transmission lines being built.

The government has taken some concrete steps to create the right conditions. They have enacted the electromobility law which will give battery storage a clear path to sell the power they store. They are also taking steps to improve transmission auctions and fast track the evaluations of important transmission projects. Should these corrective steps be successful, renewable projects in Chile will increasingly make up the energy matrix and it will do so in a way that is more profitable than now. It will also lead to the next stage of development which is the production of hydrogen. 

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