Central America strives to complete its transition to green energy

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

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

Costa Rican 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, it saw how that dependence affected it considerably in the current year, Marcos explained. Acuña, executive president of the Costa Rican Electricity Institute.

“So this year, for example, when we have had a rainfall deficit of up to 50% in some of our important basins, this affects the energy balance significantly,” Acuña said.

Costa Rica, even so, has managed to ensure that more than 98% of its electricity production comes from renewable sources, notes the Inter-American Dialogue.

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

El Salvador, a commitment to legal frameworks

A study of the UN points out that a decade ago the results of efforts for sustainable energy in the region began to be seen more clearly and since 2014 “renewable energies were the source of almost 64% of electricity generation in the region” .

Meanwhile, El Salvador has made efforts to ensure that its legal framework favors the diversification of production from the private sector, but also avoiding breaking “the payment chain” or falling into “dependence on the countries of the region,” said Ingrid Chávez. de Mendoza, current director of Commercial Operations, at the Energía del Pacífico company.

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 the 70% we had at that time to practically 97%.”

Likewise, Chávez de Mendoza 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 that has contributed to considerably reducing greenhouse emissions.

The specialized site Statista value 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 facing its own challenges

When exposing the electricity market model for Honduras, Wilfredo Flores, commissioner of the Electric Energy Regulatory Commission of his country, made reference to the challenges imposed by the effects of climate change, but also others of a strategic and planning nature.

“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,” considers Flores.

UN call

This Wednesday the Secretary General of the UN, Antonio Guterres, in a speech in New York, regarding World Environment Day, lcalled to pay attention to the alerts that nature sends itself on climate change.

“Our planet is trying to tell us something. But it seems like we are not listening,” she noted in relation to what he considers to be “the moment of truth.”

Guterres addressed in a special way the most developed nations, included in the G20, and also warned large industries to accelerate the transition to renewable energy, with the emphasis that if they are not on the fast track to clean energy transformation, are leading businesses into a dead end and dragging us all down with them.

Guatemala is committed to an open model

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

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

“The only activities that remained 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 affirms, they are on the verge of a new international tender that would boost electricity generation for the entire country.

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