Renewable Energies in Latin America: A Cheaper Opportunity

Making a transition from energies produced by fossil fuels to clean and renewable energies has always been a challenge for different reasons. One of the reasons was the dominance of conventional electricity worldwide and, also, the great cost involved in developing these new technologies to supply low-carbon energy.

However, everything has been changing in recent times and it is an opportunity for Latin American countries to begin to see favorably the possibility of initiating this transition, which will bring great environmental and economic benefits.

Conventional vs renewable energies

To begin to understand this, we must look at the reason why electricity produced by fossil fuels dominates the supply on the planet and why it made the development of sustainable technologies impossible. This is because previously it was much cheaper to exploit coal, oil and gas. Therefore, it was not easy for the new forms of energy production to enter and compete with the established ones.

On the other hand, we must bear in mind that at present 79% of the overall energy supply are still under the power of conventional. However, a negative point for companies that develop them are the consequences they have about human life and the environment.

According to observations from Our World In Data, coal, oil, and natural gas have been responsible for a number of deaths from accidents and poor air quality. In addition to the hundreds of tons of CO2 they emit into the atmosphere. Compared to new forms of energy such as wind and solar. The figures of both variables are infinitely low in renewable energies and represent a great favorability in the quality of life.

Why have the prices between both energy systems changed over the years?

Traditional electricity needs fossil fuels, made of the material found in the subsoil. While the alternates depend on technology to produce it, since their raw material is the least of it, it comes through the air or sunlight, that is, the land does not have to be exploited.

In that sense, thanks to the technological advance and the high demand of the space sector, today acquiring solar panels is much cheaper than 70 years ago. In 1956 a solar panel of a watt cost more than half a million dollars, something unsustainable. The situation changed with the mass production of panels to power satellites that were sent into space. Therefore, greater demand, cheaper prices.

Also read: Israel: Recycle CO2: New Strategy to Create Products.

The solar energy industry has followed up on errors in its operation and the development of better strategies to establish itself in the market and make its project profitable. So, the key technologies in renewable energy systems – solar, wind and batteries – follow this curve: every doubling of their installed capacity leads to the same decrease in costs.

Benefits for Latin America

This would be a potential opportunity for Latin American countries, since it not only improves the quality of the air that is breathed in the long term, but also offers economic relief for a service that turns out to be more sustainable over time.

In such a way, the learning rate of the renewable energy industries is fast, for that reason, the competition in the sector will benefit not only Latin America but the entire planet, if it were to be implemented.

Now, a fabulous economic advantage is that this would reduce unemployment globally, whether caused by inequality in some countries or as a result of COVID-19, which brought serious financial problems for companies and workers. So, thanks to low interest rates, the expansion of these energy systemslead to the creation of more jobs and cheaper prices for consumers.