Chile

Chile has made substantial progress on climate action in the past year following the enactment of the Framework Law on Climate Change (LMCC) in 2022. Chile continues to stand out as a global climate leader for its rapid renewables expansion (from 46% to 70% renewable electricity in 5 years), comprehensive planning, and accelerated coal phase-out plan. The finalisation of the sectoral mitigation and adaptation plans under the LMCC at the end of 2024 marks a key milestone in Chile implementing its 2030 NDC targets. The CAT’s overall rating of Chile’s climate targets and actions remains “Almost sufficient”, one of the few countries to earn this rating.

However, the pace and effective implementation of measures across the energy and end-use sectors remains critical for achieving Chile’s climate goals. The impact of the coal phase-out could be undermined if planned reconversions lead to higher fossil gas use, although recent policy developments suggest a more cautious approach toward new fossil fuel energy projects.

Eight coal-fired units have yet to make a retirement commitment and could continue operating until 2040. President Boric announced his intention to advance the coal phase-out date to 2035 or earlier, a possibility also reflected in energy sector plans, but this is contingent on significant improvements in renewable energy integration and grid infrastructure. Key measures in energy end-use and other sectors, including EV adoption and broader building sector measures, are still progressing slowly. Accelerating these efforts could help Chile stay on track to meet its sector-specific climate goals.

According to our estimates, Chile's emissions have already peaked in 2021, ahead of its 2025 commitment in the NDC. However, Chile will still not be able to meet its 2030 NDC target under current policies. Chile’s upper end of its current policy projections also sits in the “Insufficient” range, meaning a lack of implementation of mitigation policies and increased fossil gas consumption from retrofitting coal plants could result in a worse rating for Chile.

Chile’s coal phase-out is well on track, but there are still barriers to renewable energy being able to fully replace coal at scale. Since 2019, more than 1.2 GW of coal capacity from 11 plants has been retired, with another nine plants having made commitments to retire or convert to fossil gas by 2026. However, the pace of replacing coal with renewable energy is constrained by ongoing challenges in Chile’s grid integration and transmission capacities. Addressing these infrastructure bottlenecks will be critical not only to limit reliance on fossil gas to meet future demand, but to enable a potentially earlier coal phase-out. We find an effective coal phase-out by 2030 would align Chile with a 1.5°C global pathway.

While fossil gas is still considered a “transition fuel” by the Chilean government, the CAT estimates that it must be fully phased out by 2035 to be aligned with a 1.5°C-compatible pathway. Chile should be careful when repurposing plants to avoid carbon lock-in and stranded assets. Recent policy developments increasingly reflect these considerations: all new energy projects are now required to be assessed against “compatibility criteria” under the LMCC for their consistency with Chile’s NDC and GHG neutrality targets and must have a credible strategy for decarbonisation or conversion to green technologies.

Chile’s sectoral plans translate its 2030 climate target and sectoral emissions budgets into concrete short and medium term mitigation measures, although recent analyses suggest that these measures alone may not be enough to fully achieve the target. The Ministry of Transport is advancing the electrification of public buses and taxis and expanding train and metro networks. Under the Energy Efficiency Law, the buildings sector is updating thermal regulations, introducing stricter efficiency standards, and rolling out mandatory energy ratings for all new construction to reduce the sector’s significant energy demand. Despite these initiatives, progress remains slow relative to Chile’s high-level sectoral targets, in particular for EV adoption and retrofitting the existing housing stock.

Chile has signed carbon credit agreements with Switzerland and Singapore under its Article 6 framework, and in October 2025 authorised the first project with the former, involving converting a coal-fired boiler to biomass in the Ñuble region. Chile plans to establish safeguards to ensure additionality and traceability, alongside a clear list of eligible activities prioritising projects with higher technical or financial barriers, though the effectiveness of these measures remains uncertain.

Nevertheless, these deals risk selling emission reductions that are relatively inexpensive, as these international carbon offset transactions are designed to help the buying country meet its targets while requiring Chile to make corresponding adjustments, effectively making its own targets harder to achieve. For Chile, whose current policies are not sufficient to meet its NDC, selling reductions it could – and should – make itself may be at odds with the Paris Agreement's Article 6 additionality objective, which is to ensure that the use of carbon credits drive real and additional emission reductions.

Since our previous assessment, some of the positive developments in Chile’s climate policies include:

• Accelerating the pace of the coal phase-out since its initial announcement in 2019, with 70% of coal-fired capacity planned to be retired or retrofitted by 2026 and President Boric signalling his intent to advance the full-phase out to 2035 or earlier.
• Introducing stronger safeguards against new fossil gas expansion, including mandatory reviews for all new energy projects to ensure their alignment with Chile’s climate targets.
• Finalising all sectoral mitigation and adaptation plans in accordance with the Framework Law, establishing concrete short and medium-term mitigation measures to operationalise Chile’s 2030 NDC target.
• Reinforcing Chile’s carbon pricing and energy transition framework through higher carbon taxes and new measures to expand renewables, promote community energy, and improve storage, and transmission infrastructure to reduce curtailment and grid bottlenecks, such as the passing of the Energy Transition Law or updates to “Net Billing” law.

To accelerate its emission reductions to be aligned with a 1.5°C pathway, Chile could:

• Formally adopt an earlier coal phase-out deadline and ensure remaining units are replaced directly with renewable electricity generation rather than fossil gas.
• Reform fossil fuel pricing and subsidies. Chile still subsidises diesel fuel for internal combustion engines (ICE), while current EV incentives often target consumers who would have purchased low-emission vehicles without support, indicating that more targeted measures are needed to drive a shift towards clean transport.
• Accelerate grid investments and energy storage deployment to reduce considerable renewable curtailment and further enable the rapid expansion of renewable energy. In 2024, Chile wasted 19% of its potential solar and wind generation due to transmission issues.
• Rapidly increase the pace of reforestation and sustainable forest management for Chile to meet its LULUCF commitments under its NDC and maintain the sector’s crucial status as a considerable sink. At the same time, Chile should avoid relying on increasing its LULUCF sink to meets its climate targets, given the high chance of carbon loss through deforestation or natural disturbance, as evidenced by LULUCF emissions nearly becoming a net source of emissions in 2023 due to wildfires, and should instead prioritise emissions reductions in all other sectors.

The CAT rates each country’s targets and policies against (1) its fair share contribution to climate change mitigation considering a range of equity principles including responsibility, capability and equality, and (2) what is technically and economically feasible using modelled domestic pathways which in absence of a better method are based on global least-cost climate change mitigation.

Comparing a country’s fair share ranges and modelled domestic pathways provides insights into which governments should provide climate finance and which should receive it. Developed countries with large responsibility for historical emissions and high per-capita emissions, must not only implement ambitious climate action domestically but must also support climate action in developing countries with lower historical responsibility, capability, and lower per-capita emissions.

The CAT rates Chile’s climate targets and policies as “Almost sufficient”. The “Almost sufficient” rating indicates that Chile’s climate policies and commitments are not yet consistent with the Paris Agreement’s 1.5°C temperature limit but could be, with moderate improvements.

Chile is almost meeting its “fair share” contributions to climate change mitigation. Chile’s 2030 NDC is rated as “Almost sufficient” when compared to its fair share, and its NDC and policies and action are rated as “Almost sufficient” against modelled domestic pathways. To improve its rating, Chile could strengthen its climate policies and set a slightly more ambitious NDC target.

Chile’s current policies are "Almost sufficient" when rated against modelled domestic pathways. This rating indicates that Chile’s climate policies and action in 2030 are not yet consistent with the 1.5°C temperature limit but could be, with moderate improvements. If all countries were to follow Chile’s approach, warming could be held below—but not well below—2°C.

According to our assessment, emissions under Chile’s currently implemented policies would reach between 104–106 MtCO₂e (excl. LULUCF) by 2030 (8–10% below 2021 levels, when emissions peaked). This emissions level is also insufficient to reach the 2030 NDC target (95 MtCO₂e). Chile needs to implement additional policies in order to be 1.5° compatible.

Chile has continued to shut down coal plants according to its phase-out plan. Over 1.2 GW of coal capacity from eleven plants has been retired since 2019 and an additional nine units are planned to retire or convert to fossil gas by 2026. Up to five of these units may be retrofitted for gas.

The 2040 coal phase out date was restated in the Decarbonisation Plan and Energy Sector Mitigation Plan, but President Boric has announced his intention to advance the phase-out to 2035 or earlier. An early coal phase-out, where electricity generation is replaced by renewable sources rather than fossil gas, would significantly impact Chile’s current policies pathway and bring it considerably closer to a 1.5°C trajectory and be aligned with CAT’s power sector benchmarks.

Renewable energy curtailment due to transmission and grid integration challenges is a considerable barrier to addressing the coal phase-out. This must be addressed to ensure the reliable replacement of coal generation with renewable sources. While considered a “transition fuel” by the Chilean government, fossil gas is still a fossil fuel that the CAT estimates needs to be completely phased out by 2035 to remain on a global 1.5°C pathway.

Therefore, Chile must be careful when repurposing its coal-fired plants to avoid the risk of carbon lock-in and stranded assets. Chile’s recent stance on fossil gas increasingly reflects these considerations: all new energy projects are now required to be assessed under the Framework Law for Climate Change and their compatibility with Chile’s NDC and GHG neutrality targets.

The transport sector makes up a significant share of Chile’s total GHG emissions, especially as its energy consumption continues to increase. The Electromobility Strategy, Energy Efficiency Law, and ban on ICE cars by 2035 are key policies expected to accelerate the low-carbon transportation transition. While there has been some progress with regards to public transport electrification and vehicle fuel standards, Chile’s EV sales have only just exceeded 2%. More could be done to encourage EV uptake and decrease energy demand in the sector, for instance, by reforming diesel fuel subsidies and incentivising a modal shift in transportation, so that Chile does not fall behind on its transport electrification targets.

Maintaining the LULUCF sink is an important component of Chile’s climate targets which is threatened by the increased frequency and severity of wildfires related to climate change. In 2023, the LULUCF sector almost became a net source of emissions due to destructive wildfires. While Chile has ambitious commitments for reforestation and sustainable forest management in its NDC, the pace of implementation has been far too slow, and stronger policies to support reforestation and forest management are needed.

Full policies and action analysis can be found here.

We rate Chile’s 2030 NDC target as “Almost sufficient” when compared with modelled domestic emissions pathways. This rating indicates that Chile’s 2030 target is not yet consistent with the modelled domestic pathways limiting warming to 1.5°C but could be, with moderate improvements. If all countries were to follow Chile’s approach, warming could be held below—but not well below—2°C.

Whether Chile should receive climate finance from abroad to reduce its emissions is a matter of debate. Our methods do not provide a clear answer to this question. On balance, the CAT’s methodology shows that a small amount of international support is consistent with the wide range of literature on fair share contributions to meeting the Paris Agreement’s goals. However, this contribution would likely be small under most equity perspectives.

To improve its rating and be consistent with the 1.5°C temperature limit, Chile could update its 2030 target to limit emissions to not more than 79 MtCO₂e excl. LULUCF and communicate the finance needs that it would need to achieve it.

We rate Chile’s 2030 NDC target as “Almost sufficient” when compared to its fair-share contribution to climate action. This rating indicates that Chile’s unconditional target in 2030 is not yet consistent with its fair share of the global mitigation effort to limit warming to 1.5°C but could be, with moderate improvements. If all countries were to follow Chile’s approach, warming could be held below—but not well below—2°C.

The 2030 NDC target to be achieved with own resources needs to be improved to align with the 1.5°C limit, regardless of international support. To improve its rating and be consistent with the 1.5°C temperature limit under fair share, Chile could set an absolute emissions limit of 85 MtCO₂e (excl. LULUCF).

Chile has a significant amount of forested area, and although emissions have fluctuated strongly, e.g. because major wildfires swept across the country in 2017 and 2023, over the past 20 years Chile’s LULUCF sink absorbed, on average, roughly two-thirds of total emissions. Chile should work toward maintaining this LULUCF sink, but it is far from meeting its ambitious reforestation and sustainable forest management commitments in its NDC. For more information about forestry activities in Chile, please see the LULUCF tab under Policies and Action.

We evaluate Chile’s net zero target as “Acceptable”. Chile’s currently proposed net zero target for 2050 covers most key elements and is now also Legally Binding through the Framework Law. Chile’s target covers all sectors and gases, communicates strategic goals and emissions targets per sector, and provides a detailed methodological framework. Notably, Chile underpins these sector-specific ambitions with detailed emissions pathways.

Chile plans to rely heavily on negative emissions from forests to reach its net zero target, expecting carbon sinks to contribute as much as 50% of the emission reductions required to reach the 2050 neutrality goal (Gobierno de Chile, 2021).

It is therefore extremely important to assure that forests keep acting as sinks and do not turn into emission sources, a risk that can only partly be mitigated by policies, as not only human activity but natural factors intensified by climate change, such as more extreme and frequent heat waves, droughts, and wildfires, can turn removals from LULUCF to emissions. While Chile does not actively outline any plans to rely on reductions and removals outside its borders, future iterations of its NDC could explicitly rule out international credits to make this clearer.