Renewable Energy, creating a bright future for South America

LA energyA majority of the world is moving away from fossil fuel based energy supplies, towards a more sustainable and greener energy consumption. In order to reach Sustainable Development Goal #7, affordable and clean energy, there needs to be a variety of renewable energy sources available depending on the country’s economical, environmental and social circumstances.

Latin America has the cleanest power sector in the world and according to Cliamtescope, four Latin American countries made it to the top 10 “Most attractive emerging markets for clean energy investment in 2017”. (Brazil 2nd, Mexico 4th, Chile 7th and Uruguay 9th)

So it is a fact that the Latin American countries are moving towards a more sustainable and greener energy sector. But the question is, how are they doing it and what are the challenges? Here are some of the key elements to why renewable energy has become a key component for economic growth and increased social welfare, which is creating a bright future for Latin America.

Uruguay

Uruguay is a true fairytail story, pioneering their way towards a renewable energy future. Not long ago, Uruguay was an energy importer, but has now shifted towards an energy exporter as a result of investing in renewable energy sources.

15 years ago, oil accounted for 30% of the total energy supply and Uruguay were planning on building a pipeline from Argentina to supply gas. Compared to today, when renewable energy provides 95% of the country’s electricity. According to the former Director of Energy, Ramon Mendez, there are three key factors to why Uruguay has managed to succeed with this dramatic change. (1) Credibility; Uruguay is ranked as the least corrupt and most democratic country in Latin America and rated among one of the two “high income states in Latin America” by the United Nations. Also ranked as one of the 20 “full democracies” in the world, according to the Economist in 2015.

(2) Natural conditions: Uruguay have not only been able to transition to almost 100% renewable energy consumption, but compared to many other “green energy leaders” they have diversified their energy consumption, thanks to the access to natural resources. With good wind resources (22% of electricity need), decent solar radiation (<1%), great hydro power possibilities (56%) and access to biomass from agriculture (18%) they have been able to benefit both economically and at the same time becoming more resilient to climate change. (3) Public companies and foreign investments: Strong public companies that work in harmony with the state to create attractive investment opportunities and operating environment has made renewable energy in Uruguay a safe and ideal investment for national and foreign investors.

With a promising policy Uruguay has an ambitious and promising long term goal were they want to save US$10 million through source substitution and energy efficiency and rank as the top performer in energy intensity globally.

Chile

Chile’s government has set an ambitious goal, that the country will rely on 90% clean energy sources by 2050. Currently that number is 45%.

There are three key elements to why Chile is successfully altering the energy sector. Their natural resources, government support and healthy economy.

With Chile’s seemingly never ending coastline, off shore wind farms make an excellent energy source. The Atacama Desert in the north, which is one of the hottest places on earth allows for an ideal location to install solar panels. The volcanic landscape also located in the northern parts of the country, is almost handmade for producing geothermal energy. Despite this, their main energy source still is hydro power.

But Chile is looking to diversify their power sources, similar to Uruguay. Today, the country is too affected by droughts and floods. As a result solar, wind and especially geothermal has become increasingly more popular in the last 5 years.

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Atacama desert, solar farm

In 2017, Argentina suspended natural gas shipments to Chile, because they could not support their own domestic needs. This was a clear wake up call, saying that Chile needs to become energy self-sufficient. One of the actions Chile’s government has taken is to invest in green infrastructure to lower the price of renewable energy in the long term and make it attractive for foreign investors to invest in Chile.

A healthy economy has made it possible to create a healthy competition in the market putting different technologies and energy sources head-to-head to win the largest energy contracts. Chile has since 2014 held three large power auctions, where the result is that as much as 50% of the contract will be supplied by renewable energy.

Mexico

Mexico has had a little bit of a slow start in comparison to Chile and Uruguay, with reforms fully implemented only in 2018. However, with the constant decrease in cost of solar panels the price for renewable energy has lowered as well and has been a major contribution to the accelerated switch to investing in greener energy sources. According to Bloomberg New Energy Finance Outlook solar will overtake gas and hydro to dominate Mexico’s capacity mix, by 2040.

With the rapid growth of green energy infrastructure, primarily rural communities are experiencing a negative effect because a lot of the land that it is best suited for is already occupied by historically marginalized communities such as indigenous and rural communities. As every country, Mexico wants to increase and embrace the amount of renewable energy investment in the country, but it should not come at the expense of the most vulnerable parts of the society. They are facing a social and political challenge, they need to ensure that not only investors and wealthy land owners are taking part of the paradigm change in the energy sector, but that all parts of society receive their fair share of the cake.

Similar to Chile, Mexico is located in what is called the “Ring of Fire” which is a basin surrounding the Pacific Ocean where earth quakes and volcanic eruption occur frequently. This presents many challenges but also a lot of opportunity, especially for one renewable energy source, geothermal energy.

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Brazil

Brazil is the economic heart of Latin America and by far the largest power market. Brazil’s macroeconomic crisis, from experiencing an economic boom between 2003 and 2014 to a devastating recession that can be correlated to a growing political crisis. This has crippled many of the country’s industries, and the renewable energy industry is no different. A few examples are the absens of long term contracts through federal auctions on wind projects, increased costs for renewable energy sources and financing a project is more difficult.

Still, Brazil is ranked 2nd by Climatescope on the most attractive emerging market for investment in clean energy. A major reason why the Brazilian clean energy market is an interesting market for investors are the policies established to benefit the clean energy sector. One of their policies is to increase their energy savings. This policy forces electricity distributors to save an amount (0.5%) of their revenue, and use the savings to invest in the Brazilian energy market to make it more efficient.

Another major player that has helped develop the Brazilian renewable energy market is the Banco Nacional de Desenvolvimento Economico e Social (BNDES). The bank is one of the top global lenders to clean energy, having distributed $29 billion between 2006 and 2016. Part of their strategy is to invest in projects that undertake not only environmental problems but also social, such as modernizing the education system, health and social welfare.

As many other Latin American countries, Brazil has started to understand the importance of diversification within the renewable energy sources. This is why they are investing in other clean energy sources, apart from hydro power making them less vulnerable to droughts.

– David Gutierrez Arvidsson, May 6th 2018

Colombia: The Rejected Peace Agreement that Received the Nobel Peace Prize

 

“We must rebuild Colombia, starting with ourselves, our hearts, put resentment aside, put hatred aside, put envy aside. The only thing that those attitudes accomplish is to sow violence and sow death and suffering.”

Colombian President Juan Manuel Santos

Yellow, blue and red constitute the Colombian flag. The yellow color symbolizes sovereignty and justice, the blue color loyalty and vigilance or more beautifully described the country’s contact with two oceans (Pacific Ocean and Caribbean Sea). Finally the color red represents the valor shown and the blood that was spilled during the war of independence from Spain. But considering the violent civil wars that the country has experienced, it would be in place to increase the portion of the red color in the flag.

Ever since they gained independence from Spain in 1810, Colombia has experience no less than seven civil wars (!). In the late 50’s, just a few years after the civil war called “La violencia” ended, Colombia experienced an increased support in the extrem left wing/marxist movement, similar to many other Latin American countries did. It is during this period that the communist/marxist movement FARC was founded.

The Revolutionary Armed Forces of Colombia (FARC) were tiered of the economic inequalities that the country was experiencing and were hoping to create a decentralized state, redistribute land back to the poor and reduce the influence of multinational corporations.

In order to gain more wealth, recognition and influence in the country, FARC started to use terrifying methods. They started to gain wealth from drug trafficking, kidnapping and extortion, and these were only three of the tools they used to frighten and convey a message of terror.

Between 1964 and 2016 the war between the guerrilla group FARC and the Colombian state claimed over 220 000 lives.

The Peace agreement between Colombia and FARC

So when the Colombian President Santos announced that he was creating a peace agreement between the Colombian government and FARC, opinions among the Colombian population were scattered. The President explained that the members of FARC had agreed to surrender their weapons, form a legitimate political party, end their involvement in drug trafficking, address the human rights abuses caused over the last five decades and end a civil war that had prolonged through the entire life span of a generation. A generation that had never experienced peace in Colombia.

Timo och Santos

But in exchange they would gain representation in congress for at least the next two years, former members would not go to jail (instead serve their sentence through social work) and receive financial support from the Colombian government.

After four years of negotiation between 2012 and 2016 in Havana, Cuba, the Colombian government and the leaders of FARC finally reached an agreement and signed one of the most awaited and revolutionary agreements in modern history. The picture of President Santos and FARC leader Timoleon “Timochenko” Jimenez shaking hands covered the front page of news papers all over the world. The former Secretary General, Ban Ki-Moon attended the ceremony and Santos even received the Nobel Peace Prize in 2016.

Everybody were celebrating reaching this milestone and ending a civil war lasting more than 50 years, all that remained was a referendum where the Colombian people would vote and make the agreement “official”. But nobody predicted what happen next. Only 49,8% voted in favor of the peace agreement, which meant that the agreement did not go through! After more than five decades of war, more than 220 000 deaths and four years of negotiation, still more than half of the population of Colombia voted no!

How was this possible and what happens next? 

Many nej-sayers claim that the FARC members received a far too generous offer and needed to be punished far worse for their inhuman actions.  Perhaps some wounds run too deep and no matter how much you work on it, you just cannot stop the bleeding. The people that voted no, where mainly divided into two groups. The first group where among the richest people in Colombia who were afraid that the political party represented by the FARC members would have a left wing influence on the rest of the congress, which would not benefit their own agenda. Second group, we have the people on the other side of the spectrum, the poorest people. They felt a sense of injustice because they had been living at a minimum standard of living but still remained law abiding citizens for their entire life. Without noticing any real change. But for the people who had been part of FARC for decades, would now receive government founding and be given the opportunity to live a “normal” life, while their situation remained unchanged.

But Santos did not let this misjudgment stop his ambitions plan to end the longest ongoing war in modern history. The agreement was slightly changed and both FARC and the Colombian government remained loyal to the agreement. At the end of February 2017, FARC had handed over all their weapons and the agreement could slowly be implemented.

An amazing achievement and a step in the right direction, but one cannot claim that peace has reached the streets of Colombia. Other guerrilla groups are now increasing their influence, after the vacuum of power that FARC left behind. The instability and uncertainty will probably remain in Colombia, but this agreement has showed that Colombia is moving in the right direction and has provided Colombia with the most needed gift to keep aiming and fighting for a peaceful country, hope.

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Venezuela, all eggs in one basket?

Venezuela

Venezuela, the country known for its dramatic change of landscape where you can witness the snow covered Andes in the west and the mysterious Amazon jungle in the south. Known for its beautiful women (most victorious country in the largest international beauty pageants), great ethnic diversity and what seem to be endless oil reservs.

What went wrong in this country, where in the early 80’s other countries were praising their politic stability and the economy was booming?

There are many components that have contributed to the crisis that the people of Venezuela are experiencing today. I am gonna focus on the devastating consequence of “putting all eggs in one basket”, relying on only one primary source of income, their seemingly endless oil reserves.

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When Hugo Chavez, or “hero of the poor” as he was known by many Venezuelans came in to power in 1999. He gained followers by offering a free health care system, subsidizing food, and offering free education for everyone. He managed to decrease the poverty rate in Venezuela by half, which was amazing but the questioned remained, where did all the money come from?

The correlation between Chavez popularity and rise of oil prices is evident, which is no surprise considering that oil accounts for around 95% of Venezuela’s export and roughly 30% of its GDP. The key of his presidency was in 2004 when the oil prices started to rise. At this point Chavez even started to borrow money from other countries and spending at an unsustainable rate, without considering the consequences once the oil prices would start to fall again. Which was exactly what happened around 2014, just after Maduro, the current president, came in to power. When the price per oil barrel decreased from $111 per barrel in 2014 to $27 per barrel in 2016, they could no longer support the lifestyle that they had once promised their people. Inflation rates increased drastically, GDP fell by 35%,  murder rate increased making Caracas the most dangerous city in the world and poverty rate increased once again remarkably. Today, the poverty rate is even worse than before Chavez came in to power.

Venezuela’s crisis can be traced back to one major problem, the lack of economic diversification. Venezuela was not properly equipped to face this sort of crisis, which in itself is another problem because there are few people responsible for the suffering of millions. If Chavez or Maduro would have focused on creating an economy based on other commodities as well as oil, the crisis would not have been as though for the country.

Venezuela is facing a difficult 2018, with many challenges ahead but one bright spot in the darkness, which is the presidential election in May this year. However, the legitimacy of the election will be questioned and many are expecting an election overshadowed by corruption, political oppression and personal greed. Only time will tell the outcome of the election, but frankly the future seems to be even worse before things start to turn around.

 

The Mexican Water War, not Drug War

xochimilco

Mexico City was founded in the 14th century by the Aztecs who were a highly developed society and managed to grow Mexico City to a population of almost 300,000 people before the conquest of the Spaniard in the 16th century.

Mexico City is often refereed to as the “impossible city” due to the location where it was constructed. The story behind why the Aztecs decided to base the city one a network of lakes instead of solid soil, has to do with their religious believes. The story dates back to the 1325 a.d. when the Aztecs were led to the island by their main god, Hutzilopochtli. According to the ancient story, the god indicated that their new home would be located where they found an eagle perched on a nopal cactus with a snake in its beak.

If the Aztecs would have known the complications this would create to the modern residents of Mexico City they probably would have thought twice before building the city on artificial islands made by clay and wooden poles.

Today, Mexico City is experiencing the downside of constructing a city above a network of lakes. The city’s foundation is a combination of clay and volcanic soil, which means that one part is more resistant to aquifers being depleted and as a result parts of the city are sinking.

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By exploiting of the lakes, many parts of Mexico City are sinking a few centimeters and sometimes even meters, as you can tell in the picture. The majority of the drinking water is recovered from the aquifers located below the city, the combination of overpopulation and poor management of the water sources has lead to the water scarcity that Mexico City is experiencing today.

Managing wastewater and creating sustainable water storage 

What is most frustrating about the lack of water the inhabitants of the third largest city in the world are experiencing , is that this should not even be a problem and could actually be solved. Instead of extracting water from the aquifers located below the city, they could collect and store rainwater, in order to supply the population with clean water. Another solution is managing wastewater more efficient, but without proper management and sewer system they will never be able to satisfy the need of millions of people. And still keep the city afloat.

“Water could be a pathway  to peace or a reason for conflict”

Jan Eliasson, former Deputy Secretary-General of the United Nations, described the water scarcity situation in the world as a major reason for creating peace and dignity, if people learn to share and gain confidence in one another. But it could also create a major conflict and rip even bigger scars in an already worn country.

Drug wars, natural disasters and corruption are all matters that haunt this beautiful country, and gain most of the medial attention. But the most urgent issue, is solving the most basic and most vital need in the world, the access to a safe, clean and sustainable water source.