Latin America and the Caribbean is a region that stands out in the global energy sector. It boasts extraordinary natural resources – both fossil fuels and renewable energy – and a significant share of the world’s critical minerals. It also has a history of ambitious policy making in pursuit of stronger energy security and greater sustainability that has delivered one of the cleanest electricity mixes in the world. As the region emerges from a period of sluggish economic growth, countries in Latin America and the Caribbean now stand to leverage these resources to revitalise their economies and improve the security and sustainability of energy around the world.
The Latin America Energy Outlook, the International Energy Agency’s first in-depth and comprehensive assessment of Latin America and the Caribbean, builds on decades of collaboration with partners. In support of the region’s energy goals, the report explores the opportunities and challenges that lie ahead. It provides insights on the ways in which the outlook for the region and the biggest global energy trends are deeply intertwined – as well as recommendations on policies that could allow Latin America and the Caribbean to take full advantage of its great potential. At a time of rising geopolitical uncertainty and accelerating energy transitions, an extraordinary endowment of energy and mineral resources, as well as a history of clean energy leadership, positions Latin America and the Caribbean to play an increasingly influential role in the global energy sector, according to a new IEA special report.
The Latin America Energy Outlook is the IEA’s first in-depth and comprehensive analysis of the region, covering the full range of fuels and energy technologies across all 33 countries. The report finds that Latin America and the Caribbean’s wealth of resources and experience developing them – from high-quality renewables to oil and gas to critical minerals – could make major contributions to global energy security and clean energy transitions with the right packages of policies, on top of powering the region’s own transition and generating major benefits for local economies after a decade of sluggish growth. The special report draws on substantial input from government officials, experts and stakeholders across Latin America and the Caribbean, buildingon decades of IEA work on energy and climate issues with the region.
Latin America and the Caribbean already has one of the cleanest electricity sectors in the world, offering bright prospects for future clean energy industries. Renewables, led by hydropower, generate 60% of the region’s electricity, twice the global average, while some of the world’s best wind and solar resources can be found in countries including Brazil, Mexico, Chile and Argentina. Use of bioenergy is widespread across the region, and it is a major exporter of biofuels.
Meanwhile, countries in Latin America and the Caribbean hold about 15% of global oil and natural gas resources. And the region is highly significant for the production of minerals that are essential components in many of today’s rapidly growing clean energy technologies – with around half of global reserves of lithium, and more than a third of copper and silver reserves. The region’s clean electricity supply lays the foundation for the sustainable mining and processing of these materials.
“Latin America and the Caribbean can play an outsize role in the new global energy economy. With incredible natural resources and a longstanding commitment to renewables, countries in the region already have a head start on secure and sustainable transitions to clean energy. Leaning into these transitions would ignite growth in local economies – and put the world’s energy system on a surer footing,” said IEA Executive Director Fatih Birol. “Our report shows that supportive policy making and international cooperation are essential to ensure the region can take full advantage of its remarkable energy potential.”