World Bank funds $1.8m for geothermal development in Chile
Under the Clean Technology Fund (CTF), the World Bank provides $1.78 million to the Ministry of Energy in Chile to help geothermal development in the country.
The World Bank Board of Executive Directors approved today a US$1.78 million Clean Technology Fund (CTF) Grant to strengthen the Chilean Ministry of Energy’s capacity to further develop the country’s geothermal sector and improve its energy security.
The grant will contribute to Chile’s Energy Agenda (Agenda de Energía. Un Desafío País, Progreso para Todos) and the Energy Policy 2050, which aims to boost the use of non-conventional renewable energy (NCRE) and reduce the cost of electricity. Chile’s abundant geothermal potential provides a good renewable energy option to further diversify the country’s power generation mix, and reduce price volatility. The Government of Chile has made a concerted effort to develop its nascent geothermal energy industry, but despite what appeared to be a promising start, a number of issues stymied exploration investments.
This project aims at resolving specific barriers to improve the geothermal energy market conditions. By addressing key legal, social and market barriers, this technical assistance will contribute to the development of tradeable geothermal resources. Consumers in Chile stand to benefit from the long-term development of these resources.
These efforts will contribute to lower and stabilize energy prices, which will accrue financial benefits to businesses, as well as industrial, and residential consumers. In addition, those living in geothermal project areas, including those who are of indigenous origin, will benefit from industrial services, employment and better connectivity, and other gains associated with the sector’s development.
“Developing geothermal technology allows Chile to meet its growing energy demand, provide energy security, in an environmentally sustainable manner, boost the country’s economic competitiveness, and promote investments in remote rural areas, where poverty is more concentrated,” said Alberto Rodriguez, World Bank Director for Bolivia, Chile, Ecuador, Peru and Venezuela.
The Ministry of Energy will be the lead implementation agency, with support from the International Cooperation Agency of Chile (AGCI) within the Ministry of Foreign Relations. The US$1.78 million grant has a four-year implementation period.