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Monica_55905 Jul 16

LAEF 2021 - The Reality of Energy Transition

LAEF 2021 - The Reality of Energy Transition image
Summary of Boardroom 3 at the 5th edition of the Latin America Energy Forum, which took place as a series of interactive digital boardrooms, where cornerstone stakeholders gathered to discuss the sector's challenges and opportunities towards decarbonisation and SDG7. 
Many countries in Latin America and the Caribbean are developing ambitious plans for economic recovery involving energy generation in the post-pandemic period. These plans will present a unique opportunity to implement measures that, while reactivating the economy, also work towards the acceleration of the energy transition.

“Stimulus packages should have two aspects in mind” Chairperson Ariel Yepez said, “first, in the short term, to encourage the highest economic recovery and job creation. Second, to support actions that reduce greenhouse emissions.”

Renato Valdivia, Head of Commercialization, Atlas Renewable Energy agreed with Mr. Yepez on their responsibility as a company to carry out the necessary investment for the energy transition, working with government as to reform and improve their possibilities of deploying initiatives.

“We have a responsibility to bring in the capital, innovation and vision in order to bring about the energy transition”, he added.

When it comes to renewable energy, the resource of each country is very decisive. Fernando Gonzalez, CEO, Cerro Dominador mentioned Chile as an example, and its many opportunities for renewable energy, to the point of there being no need for a transition via gas. Other regions, however, have still room for mixed solutions.

“The geography and resources of our country bring many opportunities for energy generation through hydro power, solar and wind”, said H.E Alberto Pimentel Mata, Minister of Energy and Mines of Guatemala.

More than 70% of installed capacity comes from renewables, but Guatemala wants to raise this to 80%. With some energy still being generated from fossil fuels, they contemplate gas as an excellent option for transitioning away from them, while their excess of electricity creates a good opportunity to encourage and implement e-mobility. The minister also sees the domestic opportunities: “In Guatemala 55% of homes still cook with wood fire. We could work with other resources, such as gas, educating the population.”

The region has the challenge of being highly urban, with densely populated cities in need of electrification, while fulfilling their decarbonisation goals.

“We need to organise our businesses around this challenge. We are studying the business opportunities in the region, setting an action plan,” reassured Antonio Silveira, Vice President of Infrastructure, Development Bank of Latin America (CAF).

José Morán, Commissioner President, Electric Energy Regulatory Commission Honduras (CREE) brought up impoverished populations, and how they present an obstacle on rates, subsidies, transmission and distribution.

“With impoverished populations, we cannot afford to raise costs, which forces us to prioritize investment in fossil fuels. Separating from these strategies is one of the great challenges we face, from a policy point of view,” agreed Minister Pimentel, in relation with Mr. Morán’s concerns on rates.

There is movement in the horizon, with active participation of multilateral banks, providing partial guarantees for the financing of renewable energies. Uncertainty has been reduced, and technology has advanced by leaps and bounds. The fact remains, as Minister Pimentel stated: climate change is a reality, and so: “changes have to happen. Regulatory frameworks have to be changed, financing found, technologies implemented. We all have to do our part.”