Going with the wind: Transition to clean
energy in Latin America & the Caribbean
By Luis Felipe López-Calva
Luis Felipe López-Calva is
UN Assistant Secretary-General
and UNDP Regional Director
for Latin America and the
Caribbean
UNITED NATIONS, Oct. 31
2019 (IPS) — The UN Climate
Action Summit 2019, which
took place in the days leading
up to the 74th UN General
Assembly, delivered new pathways
and practical actions for
governments and private sector
to intensify climate action.
Among these, it recognized
that the path towards protecting
our planet requires a fundamental
change in terms of
how households, and the society
as a whole, produce and
consume electricity.
Despite important efforts,
we are still not moving slowly
in terms of investments in
clean energy. According to the
International Energy Agency,
in 2018 alone global energyrelated
CO2 emissions rose 1.7
percent to a historic high, driven
by higher energy demand.
This #GraphForThought
looks at how Latin America and
the Caribbean generates and
consumes energy, and outlines
some elements of the way forward
for LAC energy markets.
It highlights that while LAC
is a region whose contribution
to global carbon emission from
energy generation has been
relatively low (contributing to
less than 8% of total emissions
worldwide), it has contributed
significantly to the solution
by moving firmly into more
renewable sources of energy.
Energy needs to be transformed
Contributing Writers: Azad Ali, Tangerine Clarke,
George Alleyne, Nelson King,
Vinette K. Pryce, Bert Wilkinson
GENERAL INFORMATION (718) 260-2500
Caribbean Life, N 10 ovember 15-21, 2019
in order to be useful.
Primary sources of energy —
those found in nature such as
coal, oil, natural gas, nuclear
fuels, the sun, wind or rivers
— need to be transformed into
electricity (a so-called secondary
source) to be used by industry,
households, services and
transportation, among other
things.
Additionally, electricity cannot
yet be stored at a large
scale: it is either used or lost.
The process of electricity generation
produces a series of
effects that inevitably have an
impact on people and the environment,
albeit some more
than others.
That is, social and environmental
impacts differ if electricity
is generated by burning
coal, inundating a valley,
or building a wind farm, with
effects varying from greenhouse
gas emissions, displacement
of local populations, and
disturbances to local ecosystems
(i.e. wind farms threaten
flying wildlife).
The goal in energy planning
is to balance benefits and costs,
aiming ideally to find mechanism
that internalize the environmental
impact (either through
markets or through regulation,
both of which require effective
governance: clear, stable and
credibly enforced rules).
So, how does LAC fare in
terms of its energy use? According
to a widely used index, the
“energy intensity indicator”,
LAC is the most efficient region
in the world when it comes to
energy use.
This index captures the
amount of energy needed to
generate one dollar of product
or service. LAC is also becoming
more efficient over time, with
the index falling in past years,
suggesting that the region is
doing relatively more with less
energy.
To a large extent due to the
presence of large hydroelectric
power generators, 52 percent of
LAC’s energy came from renewable
sources (by 2013). This is
almost three times higher than
the global average of 22 percent
and has been increasing steadily
over the past two decades
This involves clearly many
challenges ahead. Among the
most pressing is related precisely
to the impact of climate change
on renewable energy generation:
hydropower may be a highly efficient
renewable energy system,
but it is becoming less reliable
due to changing weather patterns.
This has been exacerbated by
the effect of the El Niño and La
Niña phenomena, which strongly
influence rain levels in the
region. In parts of South America,
these lead to reduced rains
and to droughts that hinder the
capacity to generate electricity
from hydro sources, resulting in
a need to increase the generation
of electricity based on fossil
fuels to be able to meet growing
demands.
In other parts of the region,
namely the deepest southern
end of the continent, these
phenomena produce extreme
increases in rain, resulting in an
unprecedented increase of water
levels that affect families and
lead to high vulnerability for the
populations.
It is also crucial to understand
the distributional impacts
of continuing the transition
towards renewable sources of
energy in LAC. Energy transitions
will have unequal distribution
of their costs and benefits,
particularly for communities
that depend on traditional
energy infrastructure for their
livelihoods.
Rising fuel prices can also
trigger protests, as we have
seen in various countries in the
region including Brazil, Mexico,
and most recently Ecuador
(although, in this case, the
rise in price was not explicitly
due to a transition to renewable
sources but its was clearly
related to “pricing the carbon
right,” by the phasing out of fuel
subsidies).
Inclusiveness and affordability,
as well as a comprehensive
understanding of winners, losers,
and potential instruments
for compensation and mitigation,
will be critical components
for a sustainable transition.
So, what is the future of energy
in LAC? While hydropower
will continue to be the largest
energy source in the region for
a while, exploiting its complementarities
with other renewable
energy sources will be key
to ensure sustainability.
This change is facilitated
by the fact that technological
advances have allowed for a
reduction in cost and improvement
in efficiency of using these
renewable sources (solar and
wind, for example). Countries
addressing diversification efforts
are working to create the enabling
policy and regulatory environments
for other renewable
sources — such as wind and
solar — to flourish.
For example, recent auctions
in Argentina, Brazil, Mexico,
Chile, and Peru have helped to
accelerate the deployment of
thousands of megawatts of wind
and solar energy in the region.
Opportunities for investments
are vast.
Promoting the use of clean
energy in efficient ways is a critical
objective in our fight against
climate change. LAC has been
at the forefront in the use of
renewable sources, being a relatively
low carbon emitter.
However, there are challenges
ahead, with the regional
demand for energy expected to
keep growing as countries develop
and poverty levels fall. Investments
and changes in the policy
environment will be needed to
continue to transition towards
sustainable renewable sources
of energy.
As Nick Stern has stated
recently: if we get it right, clean
energy — and climate action
in general — is the inclusive
growth story of the twenty first
century.
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