The Chile Carbon Forum took place at the Faculty of Economics and Business, University of Chile in Santiago, from October 8 to 10, 2024. Juan Manuel Cardona-Granda, NbS Associate Director, attended on behalf of ClearBlue Markets.
The forum had a strong undercurrent of enthusiasm regarding the impending implementation of Article 6 mechanisms by the Chilean Government. The Ministries of Energy and Environment were heavily involved, with both ministers, María Heloisa Rojas Corradi (Environment) and Diego Pardow Lorenzo (Energy), participating several times, along with delegates and officials from both ministries. Some participants, however, privately expressed skepticism, doubting that the government will implement Article 6 “as it should be.” Only time will tell who is right.
Another prominent topic at the forum was Green Hydrogen. Chile has set its sights on becoming the cheapest alternative fuel producer in the world. The country is harnessing not only green hydrogen, but also ocean currents, geothermal energy, and hydroelectric power from rivers that flow through its central and southern valleys.
Chile also holds some of the largest lithium reserves—critical for battery technology—beneath the salt flats in its arid northern region. The country has committed to achieving carbon neutrality by 2050 and has pledged to close or reconvert 21 coal-fired power plants by 2040.
Airlines such as LATAM, along with energy and transportation giants from across Latin America like ENEL and ISA, were also present. Additionally, potential partners under Article 6, such as the Swiss KliK Foundation, participated. KliK compensates emissions from the Swiss transport sector abroad, in line with the Swiss CO₂ Act. It’s worth noting that the Swiss remain focused on energy-related mitigation and have consistently opposed NbS (Nature-based Solutions) due to concerns about permanence, an issue that has persisted since the Kyoto Protocol days in the 1990s.
Chile continues to make progress on the implementation of Article 6. The approval process for the definitive project of Article 6 regulations—focused on the International Carbon Market—is underway. The country has also signed bilateral agreements under Article 6.2, including Memoranda of Understanding (MOUs) with Switzerland, Japan, and Singapore. Emissions reduction projects in areas such as energy storage, energy efficiency, green cement, and regional electric buses are being considered.
However, the forum wasn’t solely focused on energy. There was also strong representation from the Nature-based Solutions side of climate solutions, with organizations such as Corporación Chilena de la Madera (Corma) and private sector actors like Foredor and CONAF actively participating.
A key discussion point on this panel was the upcoming overhaul of the Colombian Carbon Tax (the first to be implemented in the region, since 2017), which is set to change under the new tax system being developed by the current administration. Under the revised system, the tax on fossil fuel producers is expected to increase from around
$5+ USD per tonne of carbon dioxide equivalents to $17, among other less-clear provisions. The proposed hike has been met with opposition from some sectors in Colombia, who argue it would drive up consumer energy prices and contribute to inflation.
Article 6 Implementation in Colombia
In the same panel, and in different discussions with forum participants (off-panels), the topic of how Article 6 implementation might unfold in Colombia was repeatedly raised with ClearBlue Markets’s representative. Like Chile, Colombia is a member of AILAC (Independent Association of Latin America and the Caribbean), and several countries in the region are expected to have a joint proposal for implementation at the upcoming COP29.
From what is known about the Colombian Government’s position, largely through ClearBlue Markets’ participation in the ASOCARBONO regulatory updates committee, the current administration appears to lean towards an anti-markets approach. The government has indicated a desire to have more control over carbon markets, with some officials even suggesting that carbon will be managed in a way similar to petroleum in Colombia, where the State owns the resource and grants access through permits. A series of legislative changes is expected in the coming months, although there is widespread skepticism that the deadline will be met. Both the Ministries of Environment and Agriculture, which are responsible for carbon policy and implementation, have been chronically understaffed and have underdelivered in recent years, casting doubt on what might be achieved in time for COP29.