Latin America is one of the worldâs largest continents, with abundant, untapped energy resources. It also boasts several countries with rapidly growing economies such as Brazil and Mexico. In fact Brazilâs energy demand is predicted to grow to exceed that of Chinas by 2035, where upon they will also be one of the worldâs largest oil and hydropower producers. To help provide the required energy levels that these developing countries demand they have decided to follow renewable sources rather than fossil fuel power plants. In fact each year more and more money is invested in wind, solar and biofuel energy sources, leading to the expectation of a period of explosive growth in the future.
Brazil already leads the way in biofuel production and implementation. Their cars can run on either 100 percent ethanol or a mix of gasoline and the biofuel. This large demand for ethanol has lead them to import 500 million litres (132 million gallons) of ethanol from the U.S. since 2010, and will cause them to become one of the biggest net importers of US corn-based ethanol.
Brazil has also launched a new energy expansion plan that aims at boosting the wind power generation capacity from 1.5 GW to 11.5 GW by 2020. Obviously such a large project will bring investment opportunities that will further benefit the countryâs economy.
According to Ricardo Baitelo, Greenpeace's renewable energy campaign coordinator in Sao Paulo, the expansion is so aggressive that wind farms could very well overtake natural gas thermal plants as Brazil's second-power generation source in five years, moving right behind the number one source: hydroelectric power.
"Everyone's excited and there are hundreds of projects planned," says Jonathan Kendall, founding partner of Rio Energy Consulting.
Mexico is set to begin construction on a 396 MW wind farm project in the state of Oaxaca after receiving a US$72 million loan from the Inter-American Development Bank. MareÃ±a Renovables Capital will develop 132 turbines which will hopefully help to reduce C02 emissions by about 1 million tonnes per year.
Jeff Easum, the team leader of the project at the IDBâs Structured and Corporate Finance Department, said, âWe are helping Mexico harness its abundant wind energy resources to meet growing energy demand while reducing fossil fuel imports for electricity generation,â
The project follows an investment of US$101 million back in 2009 for two private sector wind farms in the same region with a combined generating capacity of 318 MW.
Chile are also to build their largest wind farm in 2012, 400 miles north of Santiago, with a capacity of 115 MW. This follows an agreement with Pattern Energy for the purchase of all the power produced there for the next 20 years. Siemens have already been contracted to supply 2.3MW turbines with Skanska performing the majority of construction.
Peru have decided to follow a different route and GyM-Grana y Montero S.A., along with Italy's Astaldi SpA, have been contracted to construct a 510 MW and 98 MW hydroelectric project.
Kallpa Generacion, a Peruvian subsidiary of Inkia Energy, awarded a US$680 million contract to the joint venture to carry out the 510 MW Cerro del Aguila on an engineering-procurement-construction basis. It will include; a 380,000 cubic metre, concrete dam; an underground powerhouse, nine kilometers of tunnels, and 60 kilometers of access roads. Construction is expected to start in 2012 and last about 4 years.
Bolivia is finally following its South American neighbours and is preparing to finish its first wind turbine project within two years. The 2.5-MW wind project will be built in the municipality of Cochabamba, and whilst only small, it represents the first step for the countryâs wind industry. The state owned Corani electric utility is hoping that the project will create jobs, diversify their energy mix and increase the power generation for the country.
It seems that Latin America is a hotbed for renewable energy expansion. With all the funding into research and development going on there it could well become a shining example to other continents and countries as to how to generate the majority of power from renewable sources. All methods are being contemplated to provide a well balanced renewable energy mix that will help drastically reduce CO2 emissions.
By. James Burgess of Oilprice.com