Latin America Has Enormous Untapped Potential for Green Infrastructure

By Diego Arguedas Ortiz Reprint | | Print | |En español

One of the 31 wind parks operating in Mexico. By 2020 installed wind power capacity should have climbed to 15,000 MW. Credit: Courtesy of Dforcesolar

SAN JOSE, Aug 12 2015 (IPS) - Latin America is facing a two-pronged challenge: double power generation by 2050 while reducing greenhouse gas emissions. The only solution? Green energy.

Studies show that these two goals could be within the reach of Latin America, because this region still has huge untapped potential in terms of renewable energy.

Along with transportation and land-use change, electricity generation is one of the region’s unresolved challenges in the fight against climate change.

With regard to energy production, Latin America is the planet’s greenest region, due to its long-time emphasis on hydroelectricity. But the question now is how to keep increasing the proportion of renewable energies in the face of growing domestic demand.

“When you look at it as a whole, the region’s infrastructure continues to be built like in the 20th century, even though the 21st century has a completely different outlook and requirements,” Joseluis Samaniego, a Mexican expert who is the director of the Sustainable Development and Human Settlements Division of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), told IPS.

Electricity is key to the design of the Intended Nationally Determined Contributions (INDCs) – the commitments that each nation assumes to reduce carbon dioxide and other greenhouse gas emissions.

According to the Inter-American Development Bank study “Rethinking Our Energy Future”, the region will need to increase its installed power capacity two-fold by 2050.
However, it remains dependent on fossil fuels like oil, coal and natural gas which generate greenhouse gas emissions that cause global warming.

This raises the question of what kind of infrastructure Latin America will include in its energy future. According to the IDB study, Latin America’s renewable energy generation capacity – wind, solar, hydropower, geothermal and biomass – is so extensive that only four percent of the total technical potential would be needed to meet the region’s needs by 2050.

But in recent years, the region has invested in dirtier energy sources. Although hydroelectric plants have been the main source of electricity across much of Latin America for decades, the latest figures show that its share is shrinking.

The Itaipú hydropower dam shared by Brazil and Paraguay is the second-largest in the world, after China’s Three Gorges. Credit: Mario Osava/IPS

The Latin American Energy Organisation (OLADE) reported that it represented just 38 percent in 2013, surpassed by natural gas, which now provides 40 percent.

The countries of Latin America will have to revert that process if they want to set forth more ambitious and realistic targets in their INDCs. Only a robust energy policy will make it possible to set adequate goals, experts agree.

So far, only Mexico has formally presented its INDCs, while Chile, Colombia and Peru have shown progress.

All countries must present their national commitments by Oct. 1, to be incorporated in the new binding universal treaty to be approved at the December climate summit in Paris.

“Latin America, like the rest of the world, should focus on developing electric power infrastructure with renewable sources and with the least possible environmental impact, in an attempt to depend less and less on fossil fuels,” Santiago Ortega, a Colombian engineer who specialises in renewable energy sources, told IPS.

Ortega, who is also a professor at the Engineering School in the northwest Colombian region of Antioquia, called for a balance in renewable energy generation between local, less-invasive projects and megaprojects like large dams that make it possible to store up energy, providing a reliable supply.

“Financial resources will always be scarce, and they must be invested in the most intelligent way possible,” said Ortega.

Otherwise, the global energy future will be costly. With a business-as-usual high-carbon economy, about 90 trillion dollars, or an average of six trillion a year, will be invested in infrastructure in the world’s cities, agriculture and energy systems over the next 15 years, according to the New Climate Economy report “Better Growth, Better Climate”.

But the report adds that only around 270 billion dollars a year would be needed to accelerate the global transition to a low-carbon economy, through clean energy, more compact cities, better public transport systems and smarter land use.

Experts like Costa Rican economist Mónica Araya say “the shift that is happening around the world, and we won’t be an exception, is towards energy diversification and decentralisation.”

But electricity is only part of the region’s energy mix, where fossil fuels still reign supreme.

OLADE figures from 2013 indicate that oil represents 49 percent of primary energy in the region, natural gas 26 percent, and coal seven percent.

Only six percent of primary energy comes from hydropower. Biomass, nuclear and other renewable sources complete the picture.

What does Latin America do with 80 percent fossil fuels, if the electricity supply is largely green?

According to Pablo Bertinat, director of the Observatory of Energy and Sustainability at the National Technological University in Argentina, nearly half of that energy goes to the transport sector.

“In transport, infrastructure is key,” Bertinat told IPS. “A large part of the public monies in the region goes into infrastructure works largely aimed at consolidating energy-intensive modes of transportation.”

As an example, Bertinat pointed out that while 75 percent of cargo in Argentina is moved by truck, the proportion is just 20 percent in France or the United States, which put a priority on rivers or railways.

Changes are also needed in cities, and Araya calls for modern, clean collective public transport, with electrification of private fleets of taxis or cargo vehicles.

“We lack imagination,” Araya, who heads the Costa Rican think tank Nivela, told IPS. “Neither the political class nor the business community have woken up to the need to invest in clean, modern public transit and cargo transport.”

These efforts in the energy industry will also require proposals from other fields. The main regional sources of greenhouse gases are land use and forestry (47 percent), followed by the energy industry (22 percent), agriculture (20 percent), and garbage (three percent).

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes