Q REPORTS – A decarbonization strategy can bring benefits to the Central American region at the same or lower cost than the current energy system planning strategy, according to a new report from the International Renewable Energy Agency (IRENA).
The report shows that the decarbonization path would cost the region around US$20 billion less than the planned scenario in the 2018-2050 period.
The analysis shows that better power system integration can help the region tap into the region’s abundant renewable energy potential, estimated at around 180 gigawatts (GW), a tenfold increase over the region’s current installed capacity.
The “Renewable Energy Roadmap for Central America: Towards a Regional Energy Transition” finds that achieving this goal would require increasing the total proportion of installed renewable energy capacity in the regional electricity sector to 90% and electrifying 75 %, of the region’s total vehicle fleet, by 2050. The study contributes to ongoing discussions on the region’s energy transition and related initiatives.
The IRENA roadmap outlines an ambitious but achievable Energy Decarbonization Scenario (DES) that reduces CO2 emissions in Central America by 70 percent by 2050 compared to the Predicted Energy Scenario (PES) for the same year.
“Central America is entering a crucial decade to shape its future energy system,” said IRENA Director General Francesco La Camera. “The region has a unique opportunity to ensure sustainable development with renewable energy resources that can bolster its energy security by mitigating dependency on fossil fuels, while lowering costs, spurring the region’s post-COVID-19 recovery. and addresses climate change.”
According to IRENA’s analysis, if annual renewable energy deployment in the region were to triple by 1.4 GW per year compared to the planned deployment, the region would be on track to meet its renewable energy target. To further reduce emissions from the transportation sector, green hydrogen is recommended as an alternative fuel for heavy-duty road transport as well as international shipping.
The report also points to key challenges in the region to achieve universal access to electricity and clean cooking technologies. Currently, 37% of households in Central America do not have access to clean cooking technologies and fuels. In the DES, this proportion would be reduced to just one percent thanks to the introduction of improved electric cookstoves, which would require cumulative technology costs of around US$12.5 billion during the period 2018-2050.
Additional health and socio-economic benefits would include reduced pollution from cooking activities, benefiting women and children in particular.
IRENA’s analysis serves as a technical guide that can support the decision-making process of policymakers, energy planners, government institutions and the private sector to define low-carbon development in the region.
The findings can shed light on the design, development, and implementation of energy plans, Nationally Determined Contributions (NDCs), national mitigation plans, and investment plans that are ongoing or in the pipeline.
