TELF AG examines energy headway in South America
New energy commitments
As the world moves decisively towards the adoption of the energy commitments made at COP28, many observers are starting to wonder about the speed with which the different regions of the world will be able to reach these goals and about the concrete actions that could support them on this delicate path. One of the most noteworthy areas, from this point of view, is represented by Latin America and the Caribbean, which in recent months has been meticulously analyzed in a special report by the IEA. According to the agency, the abundance of natural resources and the historic South American leadership in the clean energy sector could strengthen the international status of the continent, placing it among those most involved in the great global energy transition.
The report examined the energy situation of 33 countries, first considering their potential in the fuels, energy technologies, and raw materials sectors. One of the most relevant aspects of the study is the fact that Latin America and the Caribbean could contribute directly to global energy security, in particular through consolidated experience in the development of critical minerals and renewable energy, but also thanks to the abundance of natural resources. We are not just talking about strategic minerals but also about gas, oil, and high-quality renewable energy. To make a substantial contribution, it is necessary that the development of these resources is supported by well-considered political choices aimed first and foremost at achieving the decarbonization objectives set by international agreements.
A fully developed energy sector, supported by adequate institutional support, would not only be able to contribute to the advancement of the global energy transition but would also help local economies in their growth path after a very complex decade. For Latin America and the Caribbean, according to the IEA report, the starting point is already very encouraging: the electricity sector of these countries is already one of the cleanest in the world, and renewable energy already generates 60% of the region’s electricity, about double the global average. Nations such as Brazil, Mexico, Argentina, and Chile also have some of the best solar and wind resources in the world. Furthermore, the fact that the use of bioenergy is widespread in those latitudes represents an element of advantage for the region’s energy ambitions.
In this area of the world, many minerals are also produced which are of great importance in the diffusion of clean energy: half of the global reserves of lithium and a third of those of silver and copper are found in Latin America, and its potential linked to clean electricity ensures that in the future the extraction and processing of these resources will take place in a sustainable way with little impact on the environment. According to the IEA report, to allow the region to express all its energy potential best, it is necessary for these strategic sectors to be supported by institutions and international cooperation. The latter could allow the region to act as a single bloc, rapidly advancing in its energy development and also mainly contributing to the advancement of the world’s broader ecological transition. With the right support policies, long-term revenues from Latin American critical minerals could reach up to $200 billion, according to some estimates contained in the report.
