By: Staff Writer
November 21, 2023
The International Energy Agency said in its first every energy assessment for the Latin American and Caribbean (LAC) region that it is poised to “thrive” as the world moves towards cleaner energy.
The Latin America Energy Outlook, 2023 said that right now Hydropower alone accounts for 45 percent of electricity supply in the region and conversely fossil fuels account for nearly two thirds of the region’s overall energy mix, well below the world’s average of 80 percent.
The report also noted: “Latin America and the Caribbean accounted for 5 percent of all global energy-related greenhouse gas (GHG) emissions since 1971, while representing 9 percent of global GDP over the period. Today, the region is a net exporter of crude oil and coal, but a net importer of oil products and natural gas.
It added: “Ample renewable resources present an opportunity to make the electricity sector in Latin America and the Caribbean – already one of the cleanest in the world – even cleaner.
“Renewable electricity sources outpace electricity demand growth in all scenarios, raising their share of electricity supply from just over 60 percent today to two-thirds in 2030 and 80 percent in 2050 with today’s policy settings.
“Hydropower, the foundation of the region’s electricity supply for decades, provides the bulk of electricity today in Brazil, Colombia, Costa Rica, Ecuador, Panama, Paraguay and Venezuela. While its growth prospects are more limited in the future due to environmental and social concerns, hydro represents a huge source of flexibility.”
The report also pushed for more regional integration to help solidify these clean energy gains and also as a way to keep them secure from being eroded as well as makes them cost effective for all stakeholders.
The report also said: “Electricity becomes more central to the regional economy and is the fastest growing final form of energy in Latin America and the Caribbean.
“Electricity demand grows by 90 percent to 2050 with today’s policy settings and by 180 percent to fulfil all pledges and targets, which doubles the share of electricity in total final consumption.
“Cheap renewables in the region give electricity a cost advantage in many applications over other fuels, particularly natural gas in importing countries.”
The report cautioned however that while the region is still set to thrive with clean energy, the long term trajectory is still on a “modest” dependency for fossil fuels, but still not as much as other developed markets. This is where policy changes will become more important as the LAC continues to grow. “Today’s policy settings set a course for modest growth in fossil fuel use in the region in the long term, complemented by renewable energy. As total energy demand outpaces the growth of fossil fuels, their share of the energy mix falls from 67 percent today to 63 percent in 2030 and 54 percent in 2050. On this path, oil use sees modest growth, remaining far and away the dominant fuel in transport, despite more biofuels use and electric vehicles gaining traction.”