Central America has much to gain from a renewables revolution, not least because of its exposure to the damaging effects of climate change, and is finally starting to take advantage.
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Central America is one of the best-placed regions to benefit from new forms of renewable energy, despite being among the most vulnerable places in the world to the adverse impacts of climate change. That’s according to former US President Bill Clinton, who now heads up the non-profit Clinton Foundation and was in Panama last week for the inauguration of Central America’s largest windfarm, which has been partly financed by one of the foundation’s subsidiaries, the Clinton Global Initiative (CGI).
Despite contributing just 0.8% of annual global greenhouse gas emissions, Central America and the Caribbean has repeatedly been identified as one of the areas most at risk from the effects of climate change, with natural phenomena such as sea-level rises, extreme rainfall patterns (encompassing both drought and flooding) and more powerful tropical storms already hitting the region.
“This region of the world is highly vulnerable to climate change, to rising sea levels and to storms. But it is also one of the world’s regions that will benefit the most, economically, from the transformations in the way in which we produce and consumer energy”, Clinton said at the opening of the Laudato Si windfarm in Penonomé, located about 150 km to the west of Panama City.
The complex, whose name refers to Pope Francis’ encyclical on the environment and sustainable development published earlier this year, has an initial generating capacity of 270 MW, but this is expected to rise to 337.5 MW from early next year once more turbines are added. The electricity generated would represent approximately 8% of Panama’s energy needs, and will allow the country to avoid 400,000 tonnes in annual carbon dioxide emissions, as well as negating the need to import some 900,000 barrels of oil each year, according to the windfarm’s developer InterEnergy.
According to the former US President, Central America and the Caribbean “are diversifying away from petroleum derivatives for the generation of their electricity, and are taking control of their own destiny. Prices will be lower, and [this transition] will create more businesses and jobs. It’s a ‘win-win’”.
Central America has long been touted as an area with major potential for the development of renewable energy, which would allow it to wean itself off expensive fossil-fuelled electricity. Lacking its own reserves of oil, the region’s countries have been forced to import fossil fuels at significant cost to their economies, with a recent report from Costa Rica’s Consejo Nacional de Rectores (CONARE) finding that oil expenditure rose from 3.5 to 8.5 per cent of regional GDP between 2000 and 2013.
The same study also revealed that 36% of the region’s electricity is still produced by power plants fired by coal or oil derivatives, with 45% provided by hydroelectric power – a comparatively clean source of energy, but one which can be controversial for its impact on local water cycles and communities displaced by the flooding that results from the damming of major rivers. Hydropower is also said to be increasingly prone to the effects of severe drought, which will become more commonplace as the global climate changes. Central America has already been hit by a devastating drought since 2014, affecting millions of people as crops fail and precious water resources dry up, and the spectre of more severe droughts in the future provide another imperative for the region to switch over to more alternative forms of renewable energy.
Furthermore, the CONARE report suggested that Central America is failing to make the most of its renewable energy potential, which comes from its abundant wind and sunshine, as well the geothermal power that is offered by the region’s volcanic activity. It is this potential that Bill Clinton alluded to in his visit to Panama, and which the new CGI-supported windfarm is helping to tap into.
However, there are still numerous other reasons to be cheerful about Central America’s progress in developing a cleaner energy matrix. Costa Rica has attracted headlines over the past year for its phenomenal rates of renewable energy power: for the first 75 days of 2015 it was able to rely solely on renewable energy, leaving its few remaining fossil fuel-powered plants switched off. This was a record for any country in the world at the time, but it managed to raise the bar even higher with a 94 day run between May and August, and state authorities project that 97% of the country’s total energy supply for the whole of 2015 would end up coming from renewable sources (and for the first half of 2015, this figure stood at 98.6%).
Meanwhile, the example of Nicaragua has been highlighted by experts, including the WWF who suggested that the country is among the leaders in Latin American green energy. Nicaragua has increased the share of renewables in its electricity production from 25% in 2007 to 52% in 2013, and the country expects to generate as much as 90% of its energy from renewable sources by 2017. Its development of geothermal sources is largely behind this positive trend, an example that may also be followed by Guatemala over the coming years.