Latin America Is Well-Positioned for Clean Energy Boom: GEM
Global Energy Monitor (GEM), an international nonprofit research organization focused on energy projects, said that Latin America has the potential to become a global leader in renewable energy. However, the report stated that Mexico has slowed down its growth in this sector.
GEM’s 2023 report underscored that at its current growth pace, Latin America will achieve regional net zero targets by 2030. Researchers highlighted that by adding solar and wind capacity from current and potential projects, the region is positioned to grow its power capacity by 460% by the end of the decade. This would represent an almost 70% growth over the region’s current total electrical capacity, which is equivalent to 457GW.
“The region is a global standout on renewables. We are already seeing a big upswing. And if you look at all the projects that are planned, it is just this big, exponential-looking explosion,” said Kasandra O'Malia, Project Manager, GEM. Additionally, O’Malia pointed out that even if not all planned projects are built, the region appears to be at an inflection point as even more projects are likely to be announced in the coming years.
According to the report, Brazil, Chile, Colombia and Mexico are at the vanguard in operating utility-scale solar and wind farms in Latin America, with a collective capacity of over 57GW. Brazil leads the clean energy boom, with 27GW, of which 5.4GW comes from solar and 21.5GW from wind energy plants in operation. The country is expected to add another 217GW by 2030. President Lula da Silva, who took office in January 2023, has vowed to expand clean energy and restore Brazil's leadership role regarding climate change after four years of greater emphasis on fossil fuels under predecessor Jair Bolsonaro.
The report stresses that besides having high solar irradiance and a strong potential for offshore wind development, the continued growth of Brazil, Chile and Colombia is due to well-established energy auctions, openness to private investment, the economic potential of green hydrogen exports and policy responses to climate change. In this regard, even though Mexico was a standout leader in utility-scale solar and wind development between 2013 and 2021, pro-fossil policies promoted by President López Obrador have slowed down renewable energy’s growth. During COP27, Mexico pledged to add 40GW of new solar and wind projects by 2030. However, even if all prospective projects were to come online, the country would fall 30% short of its energy pledge. “Mexico will need to add 11GW of utility-scale solar and wind to reach its objectives,” the report reads.
The International Energy Agency (IEA) noted in a report in December 2022 that renewable energy will become the world’s largest source of electricity generation in early 2025, beating coal. Nonetheless, the clean energy transition must be accelerated to meet the Paris climate agreement’s goal of keeping global warming below 1.5 °C.