Location: New York
Author: Jill Goodkind
Date: Wednesday, July 7, 2010
Latin America is poised to be the next region of the world to embrace clean energy in a significant way with major new investment to flow there in the next several years, global clean energy and research data provider Bloomberg New Energy Finance predicts in a new report. Political stability and economic growth coupled with growing concerns over energy security and climate change have created the right conditions. With new policies supporting renewables and biofuels on the books or on the way in Argentina, Brazil, Chile, Colombia, Peru, and in other nations, investment is likely to follow.
"Latin America is ready for take-off," said Camila Ramos who heads Bloomberg New Energy Finance's research efforts in the region. "While economies here slowed during the recession, there remains a fundamental under-supply of electricity capacity that needs to be met and most countries are looking to become less reliant on foreign oil and natural gas from Venezuela, Bolivia, or elsewhere. We're seeing unprecedented commitment to the sector in the form of state-run auctions for new power generation and other state mandates. Those should result in higher investment levels in coming years."
Bloomberg New Energy Finance's Latin America Clean Energy Market Outlook H1 2010 offers in-depth research and analysis of how the latest investment, policy, and technology trends in Argentina, Brazil, Chile, Colombia and Peru pertain to renewables and biofuels. The report notes that political stability and recent economic growth have combined to create an unprecedented demand for energy across Latin America. Since 2005 when investment was $2.9bn, investment surged to $18.1bn in 2008. The region saw a pull-back in 2009 to $16bn due to the recession but is now poised to get back on track. With exceptional natural resources, stable governments and supportive policies in the region, Bloomberg New Energy Finance projects Latin American clean energy investment will continue to grow with wind attracting particular attention.
Other key findings include:
· This year promises to be a record for investment led by activity in the wind and biofuels sectors. Q1 2010 was the strongest quarter Bloomberg New Energy Finance has recorded in terms of overall clean energy investment the region.
· Wind is emerging as a main sector in Latin American renewable energy. Last year was a record for wind installations in the region with 736MW added and cumulative capacity reaching 1.4GW. Bloomberg New Energy Finance projects cumulative capacity in Argentina, Brazil and Chile alone to reach just under 8GW by 2015.
· Environmental and social concerns will act as barriers to large-scale hydro growth. The growing desire to diversify energy sources will benefit small hydro, a mature and competitive sector in the region.
· Biofuels represent the largest clean energy sub-sector in the region. Brazil and Argentina have systems in place and nascent biofuels industries exist in Colombia and Peru.
· Opportunity for biomass development remains strong in Latin America in countries were land and other resources are abundant
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