Energy transition for LatAm and the Caribbean
MPC Energy Solutions regional focus lies within the Latin America and Caribbean region. The region has abundant sources of sun irradiation and wind but many island nations still show a traditional energy mix with a relatively high reliance on fossil fuels and energy imports. Nearly all countries have therefore set ambitious targets to increase the share of renewable energies and continuous efforts are being made by local governments to further strengthen the regulatory environment and attract direct investments into the rapidly expanding energy sector.
St. Kitts and Nevis
At COP26 in Glasgow, St. Kitts and Nevis, a small island in the Caribbean presented a remarkable plan to reduce CO2 emissions by 61 percent by switching to 100 percent renewable energy. The island is a high income island with currently 94% of electricity coming from Diesel and only 6% from renewable sources.
35.7 MWp solar photovoltaic (PV) and 18.2 MW battery energy storage system (BESS)
Colombia has made the greatest progress in the renewable energy area in Latin America and the Caribbean given its privileged location for renewable energy resources. In the shorter term, Colombia aims to ensure that solar and wind produce more than 15% of the country's total installed capacity by the end of 2023. The country currently has more than 15 GW of renewable energy projects in different stages of development registered in UPME, where Solar energy accounts for more than 70% of these projects. (Source: UPME by Ministerio de Minas y Energía MME)
With the introduction of the National Energy Policy 2010-2024, El Salvador prioritized the diversification of the energy mix as a starting point for improving the energy supply and increasing access to electricity across the population. With good progress made on energy access rates and renewable energy penetration in the power sector, the new National Energy Policy 2020-2050 is now under development. This draws up a long-term energy strategy for the country, highlighting the importance of mitigating the dependency on fossil fuels and climate change effects, with the promotion and use of renewable energy beyond the power sector. (Source: Global Market Data)
In Mexico electricity generation is dominated by thermal power technology accounting for 76.9% of total generation in 2020. In 2016, the National Center for Energy Control (Centro Nacional de Control de Energía – CENACE) conducted the country’s first renewable power auctions. Between 2016 and 2018, three rounds of auctions were conducted awarding nearly 7.7 GW of renewable power capacity. Under the Energy Transition Law, Mexico aims to achieve 35% of its electricity generation from clean energy sources by 2024, 39.9% by 2033, and 50% by 2050. Under the same law, the country aims at reducing GHG emissions by 50% by 2050 compared to 2000 levels. (Source: Global Market Data)
Puerto Rico is striving for a fossil fuel-free power sector by 2050, with an interim goal of sourcing 40% of its electricity from renewables in 2025. The goal may prove to be insurmountable unless the island is able to make major upgrades to its power grid and rapidly install new capacity, given that renewables provided just 2.5% of its power in 2020, according to the US Energy Information Administration (EIA). Law 17-2019, better known as the Puerto Rico Energy Public Policy Law, establishes the goal that all citizens have access to renewable energy systems in order to achieve the goal that by 2025 40% of all energy used produced locally is eco-friendly. (Source: IHS Markit)
Jamaica is making significant strides in boosting the diversification of its energy sector, as the government looks to implement the island’s ambitious Integrated Resource Plan. The initiative has set a goal of adding around 1600 MW of generation capacity over the next 20 years to expand the island’s energy resources. The aim is to facilitate reduced energy prices, and decrease vulnerability of the energy sector to external shocks such as oil prices. Jamaica targets 33% of electricity generation from renewables by 2030 and 50% by 2037. (Source: Jamaica Promotions Corporation (JAMPRO))