Central America strives to complete its transition to green energy in the fight against climate change

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By LatAm Reports Staff Writers

Central American countries such as Costa Rica, Honduras, Guatemala and El Salvador face the challenges of climate change while leading their strategies to generate electricity by emphasizing the transition to green energy.

The governments of Central America face the challenge of moving towards ways that modernize renewable energy production. These challenges are supported by the implementation of policies and strategies that allow them to meet both internal demands and enter the international market.

Officials and energy production experts from Costa Rica, Honduras, Guatemala and El Salvador met Wednesday at the event “Electric markets and the green transition in Central America,” sponsored by the Washington-based Inter-American Dialogue think tank.

Costa Rica’s Leadership

Costa Rica has become one of the regional leaders for the production of renewable energy, however, relying heavily on hydrology as a primary source to produce electricity, saw this dependence significantly affect it this year, explained Marcos Acuña, executive president of the Costa Rican Electricity Institute.

“So this year, for example, we have had rainfall deficits of up to 50 percent in some of our important basins, this affects the energy balance in a significant way,” Acuña said.

Costa Rica, however, has managed to ensure that more than 98 percent of its electricity production comes from renewable sources, says Diálogo Inter-American.

According to the National Electric System of Costa Rica, the country produces more than 67 % through hydrological resources, while geothermal and wind energy is followed on that list with 10.89 % and 7.51 per cent, respectively.

El Salvador, a commitment to legal frameworks

A UN study notes that a decade ago the results of efforts for sustainable energy in the region began to be seen more clearly and since 2014 renewable energy was the source of almost 64 per cent of electricity generation in the region.

While El Salvador has striven for its legal framework to promote the diversification of production from the private sector, but also avoiding not breaking the payment chain or falling into the dependence of the countries of the region, said Ingrid Chávez de Mendoza, current director of Commercial Operations, in the company Energy of the Pacific.

Chávez points out that in his country, since 1996 with the issuance of the General Electricity Law to date – the percentage of electrification increased from 70 percent that we had at that time to almost 97%.

Chávez de Mendoza also adds that of all the energy capacity installed in the country, 60% is renewable generation, but of the remaining 40 % that is not renewable we now have a transition with the Natural Gas Plant (which came into operation in 2022 and which has contributed to a significant reduction in greenhouse emissions.

The specialized site Statista values that due to its vast geography and abundant natural resources, Latin America has the potential to become an important player in the sector, and to this end it cites that in 2022, the renewable energy capacity in the region approached 315 gigawatts, a growth of about 75 percent compared to a decade earlier.

Honduras to its own challenges

In exposing the electricity market model for Honduras, Wilfredo Flores, commissioner of his country’s Electric Power Regulatory Commission, referred to the challenges posed by the effects of climate change, but also other strategic and planning.

The challenges are many, we have a distribution system that has collapsed, a congested transmission system… Honduras is the only country in Central America that has three regional interconnections and does not use them efficiently,” he says.

We have a captive market, thinks Flores.

Call of the UN

On Wednesday, UN Secretary General Antonio Guterres, in a speech in New York on World Environment Day, he lay in paying attention to the alerts sent by itself about climate change.

Our planet is trying to tell us something. But it seems we are not listening, he pointed out in relation to what he considers to be the moment of truth.

Guterres addressed the more developed nations, including the G20, and also warned big industries to accelerate the path to train to renewable energy, with the emphasis that if they are not on the fast track towards the transformation of clean energy, they are leading businesses to a dead end and dragging us all with them.

Guatemala bets on an open model

For Luis Romeo Ortiz Peláez, in charge of the National Electricity Commission of Guatemala, his country has been able to move forward, among other factors, by the use of the open model and leaving behind the centralized structures dating back to the 1980s in the last century.

For this reason, he points out, there is a privilege of freedom – and he points directly to the law regulating electricity in his country.

The only activities that were regulated were the rates of regulated users and access to transmission networks, he argues.

Flores reaffirms the strategy of the current Guatemalan government to continue consolidating that model, now that, he says, they are on the verge of a new international tender that would boost electricity generation for the whole country.

This article has been translated after first appearing in Observador