In fact, investment in renewable power has ramped up for Latin American players Brazil, Mexico and Argentina thanks to strong policy frameworks as low oil prices have hammered their coffers.
Brazil has been mired in a corruption scandal that has even ensnared its president Dilma Rousseff, Mexico has struggled to receive much bidding interest for its oil and gas exploration as part of its energy sector overhaul, while Argentina is pinning its hopes on the Vaca Muerta shale.
However on the renewables front, these nations’ future targets suggest the landscape is ripe for further clean energy growth in the region, according to research and consulting firm GlobalData.
Mexico’s coal consumpsion rose 21% from 2008-2012, though coal represents only 8% of its total electricity generation, according to the US Energy Information Administration.
Mexico is a net importer of coal, supplying 81% of its coal demand domestically.
The consultancy said initiatives such as Brazil’s auction procedures had boosted the adoption of renewable energy sources, contributing towards the country’s overall aims to reduce greenhouse gas emissions from deforestation and achieve a national emission reduction of 36.1-38.9% by 2020, compared with levels in 2000.
The techniques appear to be working, with over 25% of Brazil’s total power capacity forecast to come from non-hydro renewable sources by 2025.
GlobalData’s analyst covering power, Harshavardhan Reddy Nagatham, says Mexico also appears to be making positive moves towards limiting the environmental impact of its energy consumption.
Nagatham said the Mexican government aims to limit the generation share accounted for by fossil fuel technologies to 65% in 2024, 60% in 2035, and 50% in 2050, leaving a space for renewable power to be adopted widely.
“Mexico contains substantial amounts of coal, oil and gas, which currently dominate the country’s energy mix, so the Mexican government’s move towards limiting the use of fossil fuels is indicative of a commitment to fighting climate change,” Nagatham said.
Argentina also pledged ambitious targets regarding its renewable energy use, despite historically minimal involvement with the sector, particularly as energy demands within the country are increasing substantially.
The low utilisation of renewable energy sources such as wind, solar and geothermal to date is primarily due a lack of government incentives that support renewable investment and limited support in terms of financing and project funding options.
“Currently, a large number of projects are receiving financing from the Argentinian government, which also encourages private participation through foreign investment in the energy sector,” Nagatham said.
“These changes mean Argentina has been able to set a target for 8% of its power consumption to be accounted for by renewable energy sources by 2016, up from the 2014 level of 3.5%.
“This high relative increase is indicative of a global trend in commitment to environmental issues.”
