Agostini, C. A., Armijo, F. A., Silva, C., & Nasirov, S. (2021). The role of frequency regulation remuneration schemes in an energy matrix with high penetration of renewable energy. Renew. Energy, 171, 1097–1114.
Abstract: Renewable energies (RE) in Chile and around the world have experienced outstanding growth in recent years. However, RE technologies such as solar photovoltaic and wind generate an imbalance between generation (offer) and consumption (demand) because of their intermittent and variable nature. Moreover, RE & rsquo;s natural variability makes it necessary for conventional technologies to play a significant role in adjusting for the imbalance in the electric system frequency. As variable RE penetration grows, the need for frequency regulation will increase and, depending on how those higher costs are financed, this could lead to a disincentive to invest in conventional plants that provide that service. In this paper we study the impact of increased photovoltaic energy penetration, the leading RE in Chile, on the profitability of different conventional generation technologies. Specifically, we analyze the role that the frequency control remuneration mechanism has on that impact. For this purpose, four different solar photovoltaic penetration scenarios are simulated in Chile & rsquo;s Northern System, comparing two payment criteria for frequency regulation services: i) a cost-based pricing system whose payments relate to the incurred costs and ii) a market-based pricing system where the marginal cost of providing the services is paid. The results show that as installed photovoltaic capacity increases, the average marginal cost of energy (operation cost) decreases due to a displacement of more expensive power plants, but at the same time, investment cost may increase. In the long run, contract prices change as a result of falling operational costs and rising investment cost, resulting in changes in the profitability of all technologies. Finally, while both cost-based and market-based systems reward the ability to regulate frequency, the technologies performing the regulation receive different payments for the service, affecting both their profitability and the incentives for investment.
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Agostini, C. A., Guzman, A. M., Nasirov, S., & Silva, C. (2019). A surplus based framework for cross-border electricity trade in South America. Energy Policy, 128, 673–684.
Abstract: The South American region has experienced a steady increase in its demand for electricity and faces several challenges in the development of the electricity sector. Among them, high fluctuations in hydro generation, high and volatile prices of fossil fuels, and environmental and social impacts associated to energy activities. Strengthening cooperation for cross-border electricity trade is considered a sustainable alternative for addressing these challenges. For the expansion of electricity trade among countries within the region, both infrastructure and a regulation that defines the conditions of the electric power exchanges between countries are required. A good regulatory framework would allow all market players to have access to the commercialization of energy with other countries in the region, guarantee that the treatment of exchanges is non-discriminatory, and maintain the efficiency, cost effectiveness and security characteristics operation of all electricity systems. In this context, this paper proposes a framework with the basic setting conditions for the import and export of energy from the “surplus” available for exchange. The empirical analysis of the regulatory proposal, based on simulations, shows that the exchange of energy from Chile with its neighboring countries is feasible in a clear and transparent manner, reducing the marginal costs of energy and the total cost of operation, keeping the average cost of generation relatively constant.
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Agostini, C. A., Nasirov, S., & Silva, C. (2016). Solar PV Planning Toward Sustainable Development in Chile: Challenges and Recommendations. J. Environ. Dev., 25(1), 25–46.
Abstract: Over the past decade, the promotion of renewable energy projects in Chile, especially solar energy projects, has become increasingly important, as energy dependence from foreign fossil fuels has increased and concerns regarding climate change continue to grow, posing a significant challenge to the local economy. Even though recent developments toward a more sustainable energy matrix in Chile have significantly increased the investment in the solar energy sector, social and environmental fragilities, combined with the lack of well-functioning institutions and the historical marginalization of indigenous communities who have been affected by several energy projects, result in gradually increasing conflictive situations. Unless proper mechanisms are designed and implemented to rapidly and correctly address these challenges, Chile could miss the opportunities that solar energy projects can provide to the development of its communities and to the economic growth of its regions. This article studies solar photovoltaics planning in Chile, focusing on the recent developments and the main challenges ahead, and proposes policy recommendations for effectively addressing these challenges.
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Agostini, C. A., Silva, C., & Nasirov, S. (2017). Failure of Energy Mega-Projects in Chile: A Critical Review from Sustainability Perspectives. Sustainability, 9(6), 17 pp.
Abstract: A number of successive energy crises over the last decade due to the lack of a balanced investment planning in the energy sector in Chile has led to a strong dependence on external sources and also doubled energy prices in the country, thus posing a significant challenge to the local economy. With the purpose of reaching long-term goals while simultaneously addressing short-term urgencies, Chile seeks to build a consistent and integrated energy policy in order to attract investment in the sector. Despite an overall attractive investment climate and encouraging market conditions in the country, the energy sector has been adversely affected, in particular, by the communities' opposition to mega-projects based on their expected environmental and social impacts. The study highlights recent experiences of energy generation mega-projects in terms of addressing aspects of sustainability. Based on these experiences, it discusses underdeveloped role of environmental evaluations and the main regulatory challenges ahead, recommending then public policies to effectively address these challenges.
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Caceres, G., Montane, M., Nasirov, S., & O'Ryan, R. (2016). Review of Thermal Materials for CSP Plants and LCOE Evaluation for Performance Improvement using Chilean Strategic Minerals: Lithium Salts and Copper Foams. Sustainability, 8(2), 20 pp.
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Caceres, G., Nasirov, S., Zhang, H. L., & Araya-Letelier, G. (2015). Residential Solar PV Planning in Santiago, Chile: Incorporating the PM10 Parameter. Sustainability, 7(1), 422–440.
Abstract: This paper addresses an economic study of the installation of photovoltaic (PV) solar panels for residential power generation in Santiago, Chile, based on the different parameters of a PV system, such as efficiency. As a performance indicator, the Levelized Cost of Energy (LCOE) was used, which indicates the benefit of the facility vs. the current cost of electrical energy. In addition, due to a high level of airborne dusts typically associated with PM10, the effect of the dust deposition on PV panels' surfaces and the effect on panel performance are examined. Two different scenarios are analyzed: on-grid PV plants and off-grid PV plants.
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Ciarreta, A., Martinez, B., & Nasirov, S. (2023). Forecasting electricity prices using bid data. Int. J. Forecast., 39(3), 1253–1271.
Abstract: Market liberalization and the expansion of variable renewable energy sources in power systems have made the dynamics of electricity prices more uncertain, leading them to show high volatility with sudden, unexpected price spikes. Thus, developing more accurate price modeling and forecasting techniques is a challenge for all market par-ticipants and regulatory authorities. This paper proposes a forecasting approach based on using auction data to fit supply and demand electricity curves. More specifically, we fit linear (LinX-Model) and logistic (LogX-Model) curves to historical sale and purchase bidding data from the Iberian electricity market to estimate structural parameters from 2015 to 2019. Then we use time series models on structural parameters to predict day-ahead prices. Our results provide a solid framework for forecasting electricity prices by capturing the structural characteristics of markets.& COPY; 2022 The Author(s). Published by Elsevier B.V. on behalf of International Institute of Forecasters. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).
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Ciarreta, A., Nasirov, S., & Silva, C. (2016). The development of market power in the Spanish power generation sector: Perspectives after market liberalization. Energy Policy, 96, 700–710.
Abstract: This paper provides a comprehensive analysis of the market power problem in the Spanish power generation sector and examines how and to which extent the market has developed in terms of market power concerns after the market liberalization reforms. The methodology applied in this study includes typical ex-post structural and behavioral measures employed to estimate potential for market power, namely: concentration ratios (CR) (for the largest and the three largest suppliers), the Herfindahl-Hirschman Index (HHI), Entropy, Pivotal Supply Index, the Residual Supply Index and Residual Demand Elasticity (RDE). The results are presented for the two largest Spanish generating companies (Endesa and Iberdrola) acting in the Iberian Electricity Market (MIBEL), and in the Spanish Day-ahead electricity market. The results show evidence that these companies have behaved much more competitively in recent periods than in the beginning of the market liberalization. In addition, the paper discusses important structural and regulatory changes through market liberalization processes in the Spanish Day ahead electricity market. (C) 2016 Elsevier Ltd. All rights reserved.
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Nasirov, S., & Agostini, C. A. (2018). Mining experts' perspectives on the determinants of solar technologies adoption in the Chilean mining industry. Renew. Sust. Energ. Rev., 95, 194–202.
Abstract: 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.
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Nasirov, S., Agostini, C., Silva, C., & Caceres, G. (2018). Renewable energy transition: a market-driven solution for the energy and environmental concerns in Chile. Clean Technol. Environ. Policy, 20(1), 3–12.
Abstract: Chile is undergoing a remarkable energy matrix transition to renewable energy. Renewable energies are expanding extraordinarily fast, exceeding earlier predictions. As a result, the country is expected to meet its 2025 goal of generating 20% of its electricity from renewable energy sources quite before. Chile has become one of the first countries in the world with subsidy-free markets, where renewable projects compete directly with other conventional sources. Favorable market conditions and successful policy reforms were keys to fostering this renewable energy development. Although the country has achieved a substantial growth in renewable energy investment in a relatively short period of time, this optimism should be treated with caution. A successful transition requires a combination of a clear decision making, persistent and consistent government policies, and a clear commitment to tackling challenges to accommodate renewable energy in the power system. In this context, this paper analyses the Chilean renewable industry and the required government policies to succeed in this transition. For this purpose, we identify several critical factors that have attracted and that could attract investment to the renewable energy sector and propose key recommendations to effectively address the major challenges faced for the future development of the industry.
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Nasirov, S., Agostini, C. A., & Silva, C. (2017). An assessment of the implementation of renewable energy sources in the light of concerns over Chilean policy objectives. Energy Sources Part B, 12(8), 715–721.
Abstract: In recent years, the development of renewable energies in the electricity market in Chile has gained significant attention as a key alternative for energy sources diversification and meeting three key policy objectives: energy availability, environmental protection, and social-economic development. This study aims to assess various renewable energy sources in order to select suitable sources to accomplish the different policy goals in a country like Chile. For this purpose, a Multi-Criteria Decision Analysis (MCDA) method is employed to evaluate the relative importance of policy objectives. In addition, a sensitivity analysis is conducted to build various different policy scenarios measuring the impact of variations on the current weights of the decision criteria. The results show that solar, wind, and small hydro are the preferred sources in the Chilean renewable energy portfolio, maximizing the objective of meeting the three policy goals at the same time.
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Nasirov, S., Carredano, N., Agostini, C. A., & Silva, C. (2021). Public perception and adoption of Solar Water Heating systems in Chile: The role of supply side income tax credits. Renew. Sust. Energ. Rev., 135, 110389.
Abstract: During the last decade, the Chilean government introduced a corporate income tax credit for construction companies installing Solar Water Heating (SWH) systems in new housing developments. The credit aims to provide hot-water solutions to the residential sector with a cheaper and more environmentally-friendly than fossil fuels. The tax benefits were initially granted from 2010 to 2013, during which time a total of 40,705 SWHs were installed. The credits were renewed for the 2016-2020 period, and SWH installations surpassed 100,000. The main objective of this paper is to evaluate the public perception regarding the use of SWH systems and the specific role of the tax credit program in the diffusion of SWHs during the initial period. Moreover, the analysis discusses the incentive mechanism applied in Chile and highlights several of the challenges regarding its implementation. Data was gathered using a face-to-face survey of households in three regions of Chile: Metropolitan Santiago, Valparaiso and Coquimbo, where most of the SWH were installed. The results showed that an average of 76% of the beneficiaries were highly satisfied with the SWH installations and operation, nearly 99% of respondents believed that this type of energy should be expanded to more households in Chile, and most agreed that the Government should play a significant role in such expansion.
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Nasirov, S., Ciarreta, A., Agostini, C. A., & Gutiérrez-Hita, C. (2024). Distributed solar PV applications. In Frontiers in Energy Research (Vol. 12, 1367587).
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Nasirov, S., Cruz, E., Agostini, C. A., & Silva, C. (2019). Policy Makers' Perspectives on the Expansion of Renewable Energy Sources in Chile's Electricity Auctions. Energies, 12(21), 17 pp.
Abstract: Chile has become one of the first few countries where renewable sources compete directly with conventional generation in price-based auctions. Moreover, the results of energy auctions during the last few years show a remarkable transition from conventional fossil fuels to renewable energies. In fact, the energy auction in 2017, to provide energy to customers from distribution companies, achieved a massive expansion in renewable technology at one of the lowest prices in the world. These positive results prompted the question if such results were permanent or temporal due to factors with limited effects. In this regard, this paper studies the key factors that drove the significant rise of renewable technologies in Chilean energy auctions, obtaining valuable lessons for regulators, not only in Chile, but also in the region and the world. For this purpose, we considered a well-proven method based on a hybrid multicriteria decision-making model to examine and prioritize the main drivers of the expansion of renewables in auctions. The results showed that some specific characteristics of the auction design, particularly the hourly supply blocks, the lead time for project construction, and contract duration, were the most significant drivers for the expansion of renewables in energy auctions. Moreover, the results showed that, provided that the auction design accommodates for such drivers, solar energy ends up as the most attractive technology in the Chilean auctions. The research also shows the main findings are robust by the application of a probabilistic sensitivity analysis.
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Nasirov, S., Girard, A., Pena, C., Salazar, F., & Simon, F. (2021). Expansion of renewable energy in Chile: Analysis of the effects on employment. Energy, 226, 120410.
Abstract: Over the last few years, Chile has witnessed an extraordinary energy transformation that has turned the country into one of the largest renewable energy markets in South America. This study examines the impact of renewable energy (RE) technologies from the perspective of job creation opportunities in Chile. For this purpose, the study introduces an analytical assessment model that will be used to assess the direct impacts on employment generated by several policy scenarios aimed at reducing CO2 emissions. The direct impacts on employment in Chile were calculated up to 2026 according to three energy scenarios constructed using the SWITCH-Chile energy model. The empirical results show that RE technologies (solar PV, wind, hydro) can generate more employment per unit of energy than coal and natural gas. According to the scenario projecting the largest reduction of CO2 emissions, which features a dominant participation of renewable energies, up to 20,958 jobs can be created in the Chilean energy sector by 2026. The proposed model can be used to design energy programs as a direct stimulus of employment in the RE industry. Furthermore, policy recommendations are provided based on the results to effectively address changes in employment perspectives for the RE industry. (C) 2021 Elsevier Ltd. All rights reserved.
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Nasirov, S., Gonzalez, P., Opazo, J., & Silva, C. (2023). Development of Rooftop Solar under Netbilling in Chile: Analysis of Main Barriers from Project Developers' Perspectives. Sustainability, 15(3), 2233.
Abstract: The development of rooftop solar PV generation has significant potential to generate enormous benefits to the electricity systems in achieving emission reduction targets and meeting increasing global energy demand, but could also make the power systems more resilient and affordable. In 2012, the Chilean government introduced a net billing law (Law 20.517) to incentivize consumers to sell their excess renewable electricity into the grid, which was expected to lead to a significant growth in rooftop solar. However, to date, the advancement of these technologies in the country has been very limited due to various barriers. For this reason, identifying and mitigating the main barriers that impede the advancement of development of rooftop solar is necessary to allow the successful deployment of these technologies. Based on data collected from a questionnaire survey and interviews conducted among the project developers in rooftop solar, the authors identify and rank the major barriers to the adoption of these technologies in Chile. Our findings show that the most significant barriers include “high investment and recovery period for the customer”, “lack of incentives to develop projects in the sector”, “rigid regulations regarding project size”, and “long administrative process and grid connection costs”. Furthermore, we discuss the most critical barriers in detail together with policy recommendations to overcome them.
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Nasirov, S., O'Ryan, R., & Osorio, H. (2020). Decarbonization Tradeoffs: A Dynamic General Equilibrium Modeling Analysis for the Chilean Power Sector. Sustainability, 12(19), 19 pp.
Abstract: Medium size developing countries like Chile that commit to decarbonization goals need to carefully assess the trade-offs associated to their intensity and timing, since most of the technologies required will be absorbed, not produced, by these countries. A rapid expansion of renewables in the Chilean energy matrix, mostly thanks to exceptional solar and wind resources, combined with a rapid decrease in the cost of renewable energy technologies, intensified current policy debates to reduce the role of coal, which is the largest source of CO2 emissions in the generation mix. Recently, the main generation companies in Chile made a voluntary commitment to not invest in new coal projects that do not include carbon capture and storage systems. In addition, the Chilean government announced its plans to phase out coal plants completely by 2040. In this context, the aim of this research is to study the economy-wide and emission reduction impacts of different decarbonization paths in the Chilean power sector. For this purpose, we consider dynamic simulations using a new energy-oriented version of the Computable General Equilibrium Model (CGE)- General Equilibrium Model for the Chilean Economy (ECOGEM)-Chile which is soft linked to the bottom-up engineering energy model. The results show the major impacts under both the business as usual (BAU) scenario and the coal phase-out scenario. Additionally, the study discusses to what extent the ambitious decarbonization goals of the Chilean government are coherent with the current technological limitations.
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Nasirov, S., Silva, C., & Agostini, C. A. (2015). Investors' Perspectives on Barriers to the Deployment of Renewable Energy Sources in Chile. Energies, 8(5), 3794–3814.
Abstract: In the last decade, the importance of exploiting Chile's Renewable Energy Sources (RESs) has increased significantly, as fossil fuel prices have risen and concerns regarding climate change issues grown, posing an important threat to its economy. However, to date, the advancement of Renewable Energy Technologies (RETs) in the country has been very limited due to various barriers. For this reason, identifying and mitigating the main barriers that hamper the advancement of RETs is necessary to allow the successful deployment of these technologies. Based on data collected from a questionnaire survey and interviews conducted among the major renewable project developers, the authors identify and rank the major barriers to the adoption of renewable energy technologies in Chile. Our findings show that the most significant barriers include grid connection constraints and lack of grid capacity, longer processing times for a large number of permits, land and/or water lease securement and limited access to financing. Furthermore, we discuss the most critical barriers in detail together with policy recommendations to overcome them.
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Nasirov, S., Silva, C., & Agostini, C. A. (2016). Assessment of barriers and opportunities for renewable energy development in Chile. Energy Sources Part B, 11(2), 150–156.
Abstract: Chile has become increasingly dependent on energy imports and its energy demand has grown exponentially in the past decade, impacting the environment and the production costs in the economy. In fact, electricity prices have doubled and it is expected that they will soar in the next decade if Chile does not find a solution for its dependence on imported energy resources. Recent developments, particularly improvements in the regulatory framework and incentives for renewables, have accelerated the growth process and investment opportunities of renewable energy technologies (RETs). However, RETs have faced a number of constraints affecting their penetration. In this article, we review the existing opportunities and also identify and rank the major barrier categories for the development of RETs in the Chilean context. For this purpose, the analytical hierarchy process technique has been utilized for ranking the barriers based on experts' opinions (selected from academia and industry).
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O'Ryan, R., Nasirov, S., & Alvarez-Espinosa, A. (2020). Renewable energy expansion in the Chilean power market: A dynamic general equilibrium modeling approach to determine CO2 emission baselines. J. Clean Prod., 247, 11 pp.
Abstract: Over the last decade, a high dependency on carbon-intensive fuels in the Chilean power sector has led to environmental concerns, particularly regarding rapid growth in CO2 emissions. More recently, the power sector has experienced significant structural changes with a rapid expansion of renewables in the energy matrix, and this trend is expected to cause significant variations in future CO2-emission baseline scenarios. To investigate the economy-wide impact of renewable energy expansions in Chile's energy mix, this research, based on a Computable General Equilibrium (CGE) model, examines different CO2 emission baseline scenarios. However, because traditional CGE modeling approaches cannot capture the impact of a sector's recent structural changes, we present a step-by-step approach to incorporate different energy matrices from an external engineering bottom-up model into the CGE model. The results indicate that the Business as Usual (BAU) scenario, in which structural changes are not considered, significantly overstates expected emissions. Conversely, considering structural changes in our CGE model shows Chile advancing towards its declared Nationally Determined Contribution (NDC) to reduce greenhouse gas emissions. Furthermore, the methodology implemented in the study has the advantage of being a simple integrated approach that is coherent with current modeling capacities in many developing contexts. (C) 2019 Elsevier Ltd. All rights reserved.
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