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3.14.  In accordance with the Framework Law on Climate Change, government authorities must integrate mitigation and adaptation criteria into the processes for formulating and implementing the policies, programmes, plans, rules and tools that they develop. Within the energy sector, this has led to the stepping up of efforts to decarbonize the domestic economy and create a sustainable industry that positions Chile competitively on international markets. Thus, the following strategic actions for successfully decarbonizing the economy have been identified: (i) promote more renewable and clean energies in electricity generation, together with electrification of the domestic energy matrix; (ii) establish energy efficiency actions and measures; (iii) promote a technological shift in transport towards e-mobility and clean-fuel vehicles; (iv) develop the green-hydrogen and green-hydrogen-derivative industry; and (v) promote restoration and reforestation of native woodland and other sinks, such as peat bogs, recognizing their ecosystem services and their importance as carbon sinks.

3.15.  Along with increasing the share of renewable energies in the energy matrix, government authorities have sought to cut emissions by phasing out and converting carbon units within the national territory through public-private agreements which have helped companies that own coal-fired plants to make headway in decommissioning those plants one by one. At the same time, the Just Energy Transition Strategy, adopted in December 2021, and the institutions created to deal comprehensively with the Just Socio-Ecological Transition have also provided a framework for the process of decommissioning coal-fired plants, with an intersectoral approach based on two broad areas: repair and remediation on the one hand, and productive restructuring that spurs local development towards cleaner and better-aligned industries, on the other. Therefore, the potential impact of closing the units on the labour market, on communities and on the territories concerned has also been considered. Finally, the Government is developing a Decarbonization Plan, as a public policy instrument that will be used to define a short-term and medium-term road map with regulatory, technical and social enabling conditions. This will advance the country's accelerated decarbonization process, which is driven by the phasing out of coal, but anchored in the National Energy Policy's goals: at least 80% of electricity generation from renewable energies by 2030 and carbon-neutral electricity generation by 2050. This Plan is based on three main pillars: (i) modernizing the network and the market and infrastructure; (ii) thermoelectric conversion and transition fuels; and (iii) just energy transition and communities.(...)

3.16.  In April 2023, the Government presented the Initial Agenda for the Second Phase of the Energy Transition, (...) In this "second phase", renewable and clean sources will move from playing a key auxiliary role within the electricity system to standing as the main generation source, with the aim of achieving an electricity mix featuring 100% clean energy sources before 2050. To that end, in November 2022, the Law on Electric Energy Storage and Electromobility (Law No. 21,505) was enacted, which will pave the way for stand-alone storage projects, i.e., systems which are not linked to generation plants, to receive remuneration for supplying power into the electricity system and for having available capacity at peak times. In the same vein, and as an additional measure under the Initial Agenda for the Second Phase, the draft law on energy transition was introduced as a necessary and urgent step in securing Chile's energy transition and the economic and local development linked to this process. The draft law establishes a legal link between the General Law on Electrical Services and the Framework Law on Climate Change, with a focus on the electrical infrastructure required to meet the legal target of becoming carbon neutral and resilient by 2050.

3.17.  In addition, to supplement the just transition agenda and the Framework Law on Climate Change, the Government is preparing a draft "green" fiscal reform. The "green" corrective taxes do not necessarily aim to increase tax revenue, but instead to influence decision-making by individuals and companies through relative price adjustments. This is therefore expected to promote the adoption of sustainable technologies within companies, not only to reduce CO2 emissions and local pollutants, but also to boost their competitiveness, by enabling them to thrive on international markets.

3.18.  Investments in the energy sector are anticipated to be a major driver of sustainable productive development in the country in the coming years. Chile has enormous renewable potential and can produce renewable hydrogen (known as "green" hydrogen) at low cost, in order to become a key player in the global supply of hydrogen and by-products (including ammonia, methanol and synthetic fuels). Apart from contributing to the decarbonization of the economy, green hydrogen provides a major economic development opportunity for the country and is therefore regarded as having strategic significance for the coming years. Accordingly, in 2020, the Government adopted a National Green Hydrogen Strategy and is currently developing a 2023-2030 Green Hydrogen Action Plan. This plan seeks to establish clear lines of action and to define commitments between the different parts of society, which includes the State, territories and civil society, academic and industrial organizations. Its development is based on three main lines of action: (i) investments and institutions; (ii) sustainability and local value; and (iii) infrastructure and territorial organization. (...)

3.19.  Given how closely environmental and economic matters are linked, Chile has sought to further strengthen its environmental institutions, and on 24 January 2023 the National Congress adopted the draft law creating the Biodiversity and Protected Areas Service (SBAP), which seeks to conserve the country's biological biodiversity by preserving, restoring and sustainably using species and ecosystems, with an emphasis on ecosystems and species of high environmental value or which require conservation measures because they are threatened or declining.

3.20.  Similarly, on 13 June 2022, Chile deposited its instrument of accession to the Regional Agreement on Access to Information, Public Participation and Justice in Environmental Matters in Latin America and the Caribbean, known as the Escazú Agreement, with the Secretary-General of the United Nations. This international treaty primarily seeks to ensure the full and effective implementation, in Latin America and the Caribbean, of the rights of access to environmental information, public participation in environmental decision-making processes and access to justice in environmental matters. The Agreement also deals with the need to create a safe environment favouring those who seek to exercise their access rights (environmental defenders) and the importance of contributing to capacity building and cooperation, and of helping to protect the right of every person, of both the present and future generations, to live in a healthy environment.(...)

3.21.  The Government (...) is also advancing an administrative decentralization agenda, which provides for the transfer of powers from central government ministries and services to regional governments, in order to strengthen their ability to respond to regional public challenges; and the establishment of metropolitan areas in order to allocate functions and powers for the planning of services and infrastructure in urban functional spaces, enhancing their role in areas such as transport and waste management.

1. (...) Chile's trade policy has been adapting to current global challenges, such as technological, energy and environmental challenges. (...)

8. Chile (...) also co-sponsored the Statement on Trade and Environmental Sustainability, (...)