Opinion piece by Juan Guillermo Walker, CEO and Founder of FreePower Group, for Diario Financiero.
The Government’s announcement of a bill to promote green hydrogen (H₂V) marks a milestone in the country’s energy conversation. Chile is seeking to position itself as a global leader in this emerging industry, and state commitment is a relevant step forward. However, it is worth pausing to realistically assess what this sector truly needs to take off: more than demand subsidies, it requires innovation that makes it competitive.
The challenge is not on the production side. Technologies exist, projects are moving forward, and international capital is watching with interest. The real bottleneck lies in competitiveness against fossil fuels. Subsidizing the consumption of a product that is more expensive than its conventional equivalent may send a political signal, but it is unlikely to consolidate an industry. We have seen this before with renewable energy: when it was more costly than coal, incentives alone did not drive mass adoption. It was innovation—more efficient solar panels, larger-scale turbines, cheaper batteries—that made the transition irreversible.
Chile must focus on strengthening competitiveness in renewable energy and in the production of green hydrogen and its derivatives, such as synthetic fuels and green ammonia. Some concrete measures include exempting H₂V plants from paying system costs when withdrawing energy from the grid, and reducing payments associated with public land during the study phase—thus freeing up risk capital for project development.
It is also crucial to streamline permits and access to port concessions and shared infrastructure, while reinforcing Corfo’s financing for innovation and technology transfer to institutions such as the Millennium Institute of Green Ammonia (MIGA) and academia.
Magallanes offers a clear example. Its world-class wind resources could turn the region into a global energy hub, but this requires territorial planning, services, and connectivity. Northern Chile provides another opportunity: abundant solar radiation, industrial corridors, and the possibility of using wastewater. Both territories illustrate how green hydrogen can become a driver of regional development—if planned with a long-term vision.
Chile has all the conditions to lead this transformation: natural resources, renewable energy expertise, and a well-regarded institutional framework. But leadership will not be achieved by decree or by subsidizing demand. It will come if we understand that the real catalyst for green hydrogen will be our ability to innovate and make it competitive. That is the bet that can make the difference between a lost opportunity and a new chapter in our energy history.
