Latin America’s clean energy procurement landscape is rapidly growing and attracting significant global interest in 2024. Countries across the region are prioritizing renewable energy investments to support their ambitious climate goals, reduce reliance on fossil fuels, and build a resilient, sustainable energy future. These developments are spurring a high demand for solar, wind, and energy storage technologies, drawing in both private-sector investors and large corporations looking to meet sustainability targets.
Clean Energy Technologies in Demand: Solar, Wind, and Storage
With favorable natural resources and improving technology costs, solar and wind power are the top choices for Latin America’s clean energy projects. Countries like Chile, Brazil, and Colombia are investing in solar photovoltaics (PV) and onshore wind to meet renewable energy targets. In Chile, the government aims reaching 70% renewable energy consumption and becoming carbon neutral by 2050, driving large-scale investments in both solar and energy storage solutions.
Battery energy storage, especially lithium-ion systems, is also gaining traction as a critical component for managing grid stability and maximizing renewable integration. By storing excess energy during low-demand periods, these storage systems ensure a steady energy supply, balancing the intermittency of renewable sources. Chile and Brazil, for instance, are at the forefront of storage adoption, leveraging hybrid projects combining solar and storage for a more resilient grid.
The Buyers: Utilities, Corporate PPAs, and Industry Giants
Utilities, corporate buyers, and heavy industries are the major players in Latin America’s renewable energy market. Mining companies in Chile, for example, are investing heavily in renewables to reduce operational emissions and lower energy costs. Meanwhile, corporate PPAs are gaining popularity, allowing large corporations across sectors to procure renewable energy and meet internal sustainability goals.
The appeal of PPAs is strong in countries like Mexico and Brazil, where private companies are leveraging renewables to secure long-term energy at fixed rates. These agreements allow businesses to lock in green energy and reduce exposure to volatile fossil fuel prices, while demonstrating corporate responsibility and environmental commitment.
Cost Competitiveness in Latin America’s Clean Energy Sector
Latin America boasts some of the world’s lowest costs for renewable energy, largely due to favorable conditions for solar and wind power generation. Solar PV projects in the region are competitively priced. In 2024, the average LCOE for renewables in Latin America decreased by 8%, driven by easing supply chain pressures and falling capital costs. Single-axis solar PV now boasts the region’s lowest LCOE, especially in mature markets like Brazil, Chile, and Mexico. This affordability, along with financial incentives like tax breaks and low-interest loans, has contributed to rapid adoption across the region. As battery costs continue to decline, hybrid solar-plus-storage projects are becoming more financially viable, opening up new opportunities for reliable and cost-effective renewable energy.
Supportive government policies are also crucial to the region’s clean energy market expansion. Brazil’s renewable energy auctions, for example, and Argentina’s incentives for clean energy projects are making these investments attractive and accessible to local and international investors alike.
The Future of Clean Energy Procurement in Latin America
The clean energy procurement trends in Latin America are poised to drive significant environmental and economic benefits, creating a low-carbon future for the region. As investments in solar, wind, and storage technologies continue, partnerships with companies like Acelerex will be crucial in navigating the technical complexities and maximizing the value of these clean energy projects. Through strategic procurement and the right technological support, Latin America is on track to become a global leader in sustainable energy innovation.
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Sources and References:
How Brazil and Chile are leading Latin America’s energy transition
The global competitiveness of renewable LCOE (Levelised Cost of Electricity) is on the rise