95253 Results Profile: Latin America and the Caribbean Energy March 9, 2010 CLEAN ENERGY FOR THE FUTURE Region eyes lower carbon development path Overview Successful economic and social development in Latin America and the Caribbean hinges on the availability of reliable and affordable energy supplies. The International Bank for Reconstruction and Development (IBRD) is working with governments and the private sector throughout the region to connect more people and businesses to efficient and environmentally friendly modern energy. Full Brief—6 Pages Energy Matters: Achieving Secure and Clean Energy in Latin America and the Caribbean— PDF, April 2010 Challenge Electricity demand and CO2 emissions are expected to More Results double in Latin America and the Caribbean between 2008 and 2030. Although the financial crisis has temporarily 1.2 slowed economic growth and growth in energy demand, it has also increased the challenge of obtaining infrastructure financing to increase capacity for future growth. Uncertainty million in oil markets also has led to deep concerns over energy security. Development of domestic energy resources is deemed critical in oil-importing countries, notably renewable People are gaining access to resources, such as hydro, wind and solar power. electricity in rural and peri-urban areas of Peru, Bolivia, Argentina, Mexico, Nicaragua Other critical issues in the region include: improved efficiency and Honduras, most by the end of energy supply and use; increased access to modern of 2011. energy, especially in countries with low rates of rural access such as Peru, Bolivia, Nicaragua and Honduras; and mitigation of climate change, including reducing carbon MORE INFORMATION emissions by moving toward low carbon growth scenarios, especially in larger countries such as Mexico and Brazil. An World Bank: Energy additional challenge is to adapt institutional and regulatory Peru Wind Atlas  frameworks in the energy sector to meet these new challenges. PARTNERS Approach Global Environment Facility IBRD customizes its investment and technical assistance for Inter-American Development each country around four major elements: energy security; Bank clean energy development; energy efficiency; and access to International Energy Agency energy. In addition to using its own resources to develop Deutsche Gesellschaft für these activities, IBRD leverages considerable amounts of Technische Zusammenarbeit financing from other sources including the Global (GTZ) Environment Facility, Carbon Finance Funds, the Clean KfW Technology Fund and Energy Sector Management Assistance Program (ESMAP) funds for technical assistance. European Investment Bank  Japan International Cooperation In Mexico, IBRD combines development policy lending, Agency investment lending and in-depth analytic work to help develop the country’s substantial renewable energy potential. IBRD contributed $650,000 and technical assistance to support regulation the country’s Renewable Energy Law   passed in 2008. A $1.5 billion development policy loan, approved in October 2009, underpins the government’s ambitious climate change program, which looks to promote the installation of more than 3,000 MW of clean renewable energy by 2012. IBRD also helps improve electricity sector performance, efficiency and access. In addition, two separate studies have strengthened planning for, and awareness of, lower-carbon development in Brazil and Mexico. Results IBRD is helping to provide new electricity access to an estimated 1.2 million people in rural and peri-urban areas of Peru, Bolivia, Argentina, Mexico, Nicaragua and Honduras, mostly by the end of 2011. In Peru, for example, the Rural Electrification Project connected more than 100,000 people to electricity service by the end of 2009 and will provide service to almost 500,000 rural people by the end of 2011. More than 600 MW of renewable energy capacity (210 MW from wind, 320 MW in small hydropower, and 70 MW through other technologies), are being installed in the region with financing by GEF grants, Carbon Finance, and IBRD loans. Results coming from Bank-assisted activities in Mexico include: the 83 MW and 101 MW La Venta 2 and 3 wind farms; the 12-15 MW solar component of the Agua Prieta solar/thermal generation plant; and provision of electricity service with solar home systems to 250,000 rural people in the poorest regions of the country. In Brazil, IBRD is preparing a project to help six distribution companies serving 3 million people to reduce losses by 15 percent. In the Dominican Republic, a country plagued by serious problems in the electricity sector, IBRD helped reduce electricity losses by 14 percent from 2005-2008, through conditions met as part of a $150 million Electricity Sector Reform Loan. Two studies on lower-carbon development in Brazil and Mexico raised awareness using highly participative approaches involving multiple high-level consultations with ministries and public agencies. The studies were presented at the 15th Conference of Parties of the United Nation Framework Convention on Climate Change (UNFCCC) in Copenhagen on December 6-19, 2009. Toward the Future The energy sector in Latin America and the Caribbean is expanding investment activities as well as leveraging analytic work such as the Central American Programmatic Energy Study, which presents the main challenges and opportunities faced at the national and regional levels, and the low carbon pathway studies for Brazil and Mexico .  Examples of interventions under development include the Mexico Efficient Lighting and Appliances Project ($350 million, IBRD $300 million, CTF $50 million), which aims to enhance the country’s energy security by increasing efficient use of energy and to support its efforts to mitigate climate change; and the Electrobras Distribution Rehabilitation Project ($699 million, IBRD $485 million), which aims to improve the financial and operational performance and the commercial management of six Eletrobrás-managed Distribution Companies (DisCos) in Brazil by reducing electricity losses, increasing bill collection rate, and increasing quality of service.   Last updated: 2010-04-07