Going with the Wind: Transition to Clean Energy in Latin America & the Caribbean

The Providencia Solar company inaugurated in 2017 is the first photovoltaic power plant in El Salvador, in the central department of La Paz. With 320,000 solar panels, it is one of the largest solar installations in Central America, whose countries are making efforts to transition their energy mixes to renewable sources. Credit: Edgardo Ayala / IPS

By Luis Felipe López-Calva
UNITED NATIONS, Oct 31 2019 – 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 energy-related 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.

Luis Felipe López-Calva

Energy needs to be transformed 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% of LAC’s energy came from renewable sources (by 2013). This is almost three times higher than the global average of 22% 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.

Red Alert for Blue Planet and Small Island States

The Pacific island is one of the countries worst affected by sea-level rise. Credit: UNICEF

By Farhana Haque Rahman
ROME, Oct 31 2019 – Barely a week passes without alarming news of the most recent scientific research into the global climate crisis compounding a growing sense of urgency, particularly the impact on small island states from rising sea levels and extreme weather.

Latest findings suggest that several hundred million more people than previously thought are at risk of coastal flooding due to climate change. Climate Central, a non-profit research and news organisation, found data used in past calculations overstated the elevation of many low-lying coastal communities.

And for the people of the Bahamas who had just endured Hurricane Dorian, the most intense tropical cyclone on record to hit their islands, it came as little surprise when the UN Intergovernmental Panel on Climate Change (IPCC) soon after released its landmark special report on the planet’s oceans and frozen regions, warning of “multiple climate-related hazards” for coastal regions.

“The ocean is warmer, more acidic and less productive,” the IPCC report stated.

The “Blue Pacific” concept sees the island states establishing themselves as “large ocean states” and guardians of the region rather than “small island states”

Oceans are absorbing heat twice as fast as just two decades ago, with hundreds of billions of tonnes of melting ice raising sea levels at an average rate of 3.6 millimetres a year, more than twice as fast as during the last century.

If greenhouse gas emissions “continue to increase strongly”, the IPCC report said, then levels could rise more than a metre by 2100.

Some island states in the Pacific face becoming uninhabitable. As UN Secretary-General Antonio Guterres noted while visiting Tuvalu, the sea level rise in some Pacific countries is four times greater than the world average, posing “an existential threat” to several island states.

Against this background the UN COP25 climate change summit scheduled to be held in Santiago in December had been dubbed the Blue COP, with expectations of a focus on the oceans and commitments of aid to poorer nations most at risk. So it comes as a serious blow that President Sebastian Pinera has just announced that Chile is calling off its hosting of COP25 because of mass anti-government protests rocking the country.

While the UN anxiously looks for an alternative venue (and Santiago had been the second choice after Brazil’s newly elected president, Jair Bolsonaro, pulled out of hosting it), the small island states of the Pacific will be making their voices heard as they seek to confirm themselves in the role of custodians of the world’s largest region.

It is an existential struggle but it is not a blame game however.

Farhana Haque Rahman

As Micronesia’s President David Panuelo declared last week in The Diplomat: “Rather than point fingers, we must all point the way toward solutions.”

“No single country created this problem, and certainly a small country like ours is bearing far greater responsibility for the solution than we ever contributed to the crisis in the first place. But we sit shoulder to shoulder in a coalition which has set a goal of growing economies while achieving 30 percent marine protection globally,” he wrote in a plea for action to save the oceans.

“Everyone must do more when garbage patches larger than entire countries float in the Pacific, and rising carbon dioxide levels increase ocean acidity and devastate coral reefs and marine life.”

The Pacific Community, the principal scientific and technical organisation in the region and founded as the SPC in 1947, counts 22 Pacific island countries and territories among its members who see themselves as the “tip of the spear” in terms of the impacts of climate change and their efforts to adapt.

SPC has recently established the Pacific Community Centre for Ocean Science (PCCOS) to provide the framework to “focus its scientific and technical assistance on providing solutions that will build, sustain, and drive blue economies in Pacific Island countries and territories” and support SDG 14 of conserving and sustainably using oceans and marine resources.

The SPC’s new and growing Pacific Data Hub is a public resource of data and publications on the Pacific across key sectors, from education and human rights to oceans and geoscience.

Such initiatives reflect how Pacific Island states have grown more assertive in their diplomacy, becoming more active in global multilateral forums and using their voices and votes for increased leverage rather than the old reliance on support from Australia and New Zealand.

The “Blue Pacific” concept sees the island states establishing themselves as “large ocean states” and guardians of the region rather than “small island states”. As stewards of the Pacific with their cultural identity shaped by the ocean, the Blue Pacific framework seeks to establish leadership on issues, with smart policies backed by scientific expertise and data.

As Micronesia’s president has reminded us, the climate crisis is neither abstract nor “tomorrow’s faraway challenge”. It is happening now and as the IPCC’s special report on the oceans and cryosphere warned in September the crisis is gathering speed, as seen in the recent acceleration of sea level rise.

In Antarctica the rate of ice loss tripled in the decade 2007-2016. May and August in 2019 were the warmest on record for the Arctic while this year saw the summer minimum extent of sea ice reaching a joint-second lowest in 40 years of satellite records.

As summarised by Carbon Brief, the IPCC warns that this accelerating ice loss, and the more rapid sea level rises it causes, will continue to gather pace over this century regardless of whether greenhouse gas emissions are reduced. The “likely” maximum rise of 1.1 metres by 2100 is some 10cm above the top-end estimate from its previous estimate, while a rise of 2 metres cannot be ruled out.

Such warnings were intended to provide input at COP25 for world leaders who face mounting calls to adopt more ambitious goals for carbon emission cuts. Those negotiations will not be happening in December in Santiago after all. An alternative must be found urgently.