Chile

Critically Insufficient4°C+ World

NDCs with this rating fall well outside of a country’s “fair share” range and are not at all consistent with holding warming to below 2°C let alone with the Paris Agreement’s stronger 1.5°C limit. If all government NDCs were in this range, warming would exceed 4°C. For sectors, the rating indicates that the target is consistent with warming of greater than 4°C if all other sectors were to follow the same approach.

Highly insufficient< 4°C World

NDCs with this rating fall outside of a country’s “fair share” range and are not at all consistent with holding warming to below 2°C let alone with the Paris Agreement’s stronger 1.5°C limit. If all government NDCs were in this range, warming would reach between 3°C and 4°C. For sectors, the rating indicates that the target is consistent with warming between 3°C and 4°C if all other sectors were to follow the same approach.

Insufficient< 3°C World

NDCs with this rating are in the least stringent part of a country’s “fair share” range and not consistent with holding warming below 2°C let alone with the Paris Agreement’s stronger 1.5°C limit. If all government NDCs were in this range, warming would reach over 2°C and up to 3°C. For sectors, the rating indicates that the target is consistent with warming over 2°C and up to 3°C if all other sectors were to follow the same approach.

2°C Compatible< 2°C World

NDCs with this rating are consistent with the 2009 Copenhagen 2°C goal and therefore fall within a country’s “fair share” range, but are not fully consistent with the Paris Agreement long term temperature goal. If all government NDCs were in this range, warming could be held below, but not well below, 2°C and still be too high to be consistent with the Paris Agreement 1.5°C limit. For sectors, the rating indicates that the target is consistent with holding warming below, but not well below, 2°C if all other sectors were to follow the same approach.

1.5°C Paris Agreement Compatible< 1.5°C World

This rating indicates that a government’s NDCs in the most stringent part of its “fair share” range: it is consistent with the Paris Agreement’s 1.5°C limit. For sectors, the rating indicates that the target is consistent with the Paris Agreement’s 1.5°C limit.

Role model<< 1.5°C World

This rating indicates that a government’s NDC is more ambitious than what is considered a “fair” contribution: it is more than consistent with the Paris Agreement’s 1.5°C limit. No “role model” rating has been developed for the sectors.

1.5°C Compatible< 1.5°C World

Overview

Early 2020, Chile was one of the first countries to officially submit an updated Paris Agreement target to the UNFCCC. The updated Nationally Determined Contribution (2020 NDC) is more ambitious than the first, and even slightly more ambitious than the draft published in 2019. The 2020 NDC also includes a new conditional target and links the 2030 targets to the 2050 carbon neutrality goal. The submission of these new targets resulted in an upgrade of its current rating, from “Highly Insufficient” to “Insufficient.” While the 2020 NDC shows the Chilean Government has increased its climate ambition, it is not enough to be considered compatible with efforts to limit global warming to either 2°C or 1.5° C.

If it were to implement all its planned policies, Chile could peak its emissions in 2023 ─ two years earlier than the proposed peak year of 2025 ─ which would be a remarkable achievement and set up the country as a frontrunner on climate action.

According to local media, the lockdown imposed to combat the COVID-19 pandemic caused a reduction of 20% of Chile’s daily carbon emissions; however this reduction will be short-lived if the government does not introduce permanent measures to foster the structural changes needed to transition to a zero emissions society as part of the country’s recovery package.

Chile's government has focused its mid-June “COVID agreement” on economic recovery and boosting employment. Some civil society organisations have rejected the plan, arguing the proposal is not in line with the green investment needed to mitigate climate change and structurally solve social inequality and vulnerability." The CAT has not assessed Chile’s COVID-19 recovery proposals.

According to our assessment, based on a projected drop in GDP in 2020 due to COVID-19, Chile’s emissions projections for 2030 under current policies could be 3% - 11% lower than our previous assessments. Chile will continue to overachieve its 2020 commitment. Projected emissions for 2030 under current policies remain well above the 2030 unconditional NDC target. If Chile goes ahead with implementing planned policies such as the 2050 Energy Strategy, the coal phase-out and the electromobility strategy, it could reach (and perhaps overachieve) the new NDC target for 2030.

Chile is seeking to reach GHG neutrality by 2050, as established in its 2020 NDC and the draft Climate Change Framework Law currently under discussion in the National Congress. Chile will heavily rely on negative emissions by forests to reach its net-zero target, expecting carbon sinks to contribute as much as 50% of the emissions reduction required to reach the 2050 neutrality goal. This can pose a risk, given the high chances of carbon loss through deforestation or natural disturbance and eventual competition for land. Chile’s updated unconditional 2030 target has improved one CAT rating from “Highly Insufficient” to ‘Insufficient’. The “Insufficient” rating indicates that Chile’s proposed unconditional climate commitment in 2030 is still not consistent with holding warming to below 2°C, let alone limiting it to 1.5°C as required under the Paris Agreement, and is instead consistent with warming between 2°C and 3°C.

According to our assessment, after COVID-19 impacts, Chile’s currently implemented policies would reach levels of between 108 and 122 MtCO₂e excl. LULUCF by 2030 (3% below to 9% above 2016 levels). This is not sufficient to reach the 2020 NDC target and Chile will need to implement additional policies in order to reach this new target. However, our emission projections for planned policies after COVID-19 show that Chile could reach emissions levels of 87-98 MtCO₂e excl. LULUCF by 2030 (13-22% below 2016 levels). Chile’s unconditional NDC target is 95 MtCO₂e by 2030, therefore with full implementation of its planned policies, including the shutdown of all coal power plants and the electromobility strategy, Chile could meet or potentially overachieve its new unconditional target. This, however, heavily relies on the impacts of the pandemic on the economy and on whether the government will introduce permanent measures to foster the structural changes needed to transition to a zero emissions society as part of the country’s recovery package.

Our current policy emissions pathway includes the Unconventional Renewable Energy Law (Law 20.257/2008), the carbon tax (Law 20.780/2014), the results of electricity supply tenders as of December 2017, emissions reductions from the retirement of the first eight coal-fired power plants announced in 2019, and the Electromobility Strategy, which sets out an action plan to achieve electrification of a 40% share of the private vehicle fleet—and 100% of public urban transport—by 2050. We have further included the potential impacts of COVID-19 on reducing greenhouse gas emissions in 2020 and 2021 by estimating the emissions intensity of the economy and adjusting it to the most recent GDP projections that take into account the effect of the pandemic (for more details, see Assumption section). Further, our analysis continues to suggests that Chile will overachieve its 2020 pledge with currently implemented policies (same as in previous assessments).

The Energy Route 2018–2022 establishes commitments to further reduce national emissions. These commitments include quadrupling small distributed renewable energy capacity by 2022; establishing a legal framework for energy efficiency in the industry, mining, transport, and buildings sector; implementing a ten-fold increase of current EVs share and regulating solid biofuels (i.e. wood). We have not included these targets in our current policy projection and will only do so when concrete policies are set to achieve these targets.

In line with government plans, we have estimated the impact of a complete coal phase-out by 2040 under a planned policies scenario. The main difference between the current policy and the planned policy scenarios lies in the assumptions of the long-term share of renewable energy and the retirement of coal fired power plants (for more details, see Assumption section).

We have also included government estimates for Chile’s net-zero carbon target for 2050. Although significantly relying on forestry sinks, we estimate 2050 emissions would be consistent with the CAT rating category of 2°C Paris Agreement compatible for Chile.

FOR FULL DETAILS SEE CURRENT POLICY PROJECTIONS SECTION