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Renewable energy is expected to become the main electricity source in the world in the coming decades, with solar and wind power taking a big share of the energy supply. Although there has been a remarkable advance on renewable energy technologies, their integration is still difficult for regulators, market designers and system operators due to the high variability and limited predictability of solar and wind resources. Measures can be adopted to ease their integration, among them geographical diversification. There is plenty of literature about the diversification of solar and wind resources and there is a common conclusion: greater dispersion smooths out power production. However, literature on the effects of spatial diversification on the power system, electricity prices and renewable energy market value is much scarcer. This paper studies the effects of spatial diversification and questions whether integration policies are incentivizing the placement of renewable generators where they provide the highest value to the electricity system in Chile. Using real data and a simplified dispatch model the analysis presented shows evidence of the effects of diversification on wind and solar market value in Chile. Results suggest that spatial diversification has a strong positive effect on the market value of renewable energy, especially in scenarios with active transmission and hydro-storage constraints. Wind market value may vary up to US$10/MW h depending on the level of diversification and the spatial and temporal constraints of the system and, given current storage capacity of hydro reservoirs, the solar market value may increase US$5/MW h due to diversification if transmission capacity is enough. Even though these results must be observed with caution, because they depend on the assumptions made, there is an important effect of renewable spatial diversification that should be observed by regulators. • Effects of spatial diversification on the power system and its prices. • Strategies to mitigate the value drop of variable renewable energies. • Spatial diversification has a positive effect on market value of renewable power. • Storage is important resource to alleviate market value drops of renewable energy. [ABSTRACT FROM AUTHOR]

The energy demand in Chile arises mostly from mining, its largest industry that accounts for about 35% of total electricity consumption. Energy generation to satisfy this demand depends completely on imported fossil fuels. As a result, the mining industry faces several energy related challenges. In particular, the cost and environmental impact of fuel sources are threatening the competitiveness of the industry and urge for new developments. In that regard, the importance of using clean and cost-competitive renewable energy sources has increased significantly in Chile and several government policies helped to increase the investment in them. The impact has been particularly large in the development of solar energy in the northern part of the country, where almost all mines are located. In fact, the country has become one of the largest solar markets in Latin America thanks to its abundant solar resources, favorable market conditions, and successful policy reforms. Solar energy then, could play a significant role as an alternative to satisfy the mining industry's energy demand offering a broad range of technological solutions. This study examines the key issues -barriers and drivers- influencing the adoption of solar technologies in the Chilean mining industry from the perspective of mining actors. As a result of the analysis the paper also provides a scope for appropriate policy interventions. [ABSTRACT FROM AUTHOR]

Chile needs to increase its installed electric capacity to support economic growth. Currently, the total demand is 67,564 GW h and an additional 22,508 GW h will be needed by 2020 to meet the energy demand of industrial projects. The Chilean mining industry is a major electricity consumer in the country accounting for one third total consumption over today. Solar energy has the highest potential for growth in northern Chile as the north of the country hosts the highest solar resources of the world. In this paper we present a comprehensive review of the energy supply and demand status, planning and prospects in the country with focus on solar photovoltaic- and solar thermal-projects. As of the end of 2014, a solar capacity of 2384 MW are operational and under construction, and more than 10,000 MW of solar power plants have been proposed; most solar projects are located in northern regions where the mining takes place. Considering a conservative scenario where one half of the proposed solar projects would be operational before 2020, solar technology could cover a great part of the country’s energy requirements. We evaluated eight operating PV plants and three operating solar thermoelectric plants based on a multi-criteria assessment to offer a reference point for assessing future projects. [ABSTRACT FROM AUTHOR]