1. THE RENEWABLES ENERGIES IN THE CARBON MARKET IN LATIN AMERICA
22nd International Sustainable Development Research Society Conference, School of Science and Technology, Universidade Nova de Lisboa, Lisbon, Portugal, 13 –15 July 2016
THE RENEWABLES ENERGIES IN THE CARBON MARKET IN LATIN AMERICA
Lira Luz Benites-Lazaro1, Alice Falleiro2, Neli Aparecida de Mello-Théry1, André Luiz Miranda Silva Zopelari3 Celio Andrade 4
1 University of São Paulo, Universidade Federal Santa Maria, 3 Universidade Federal do Rio de Janeiro, 4 Universidade Federal da Bahia.
The paper aims to describe the main features of the countries’ positions in the CDM renewable energy projects in Brazil, Mexico, Chile and Peru. The first effort was to evaluate the CDM portfolio concentrating on renewable energy projects. Moreover, a special analysis was in the public policy in order to identify how political-institutional and economic aspects have influenced the development of CDM projects.
Abstract
CDM portfolio and renewables energies in Latin America
Four countries (Brazil, Mexico, Chile and Peru) leading the CDM projects development in the renewable energies sector. In Brazil it represents 62.8% of total of projects registered. In Mexico the renewable energy represents 40.1%. In Chile 73.5% and in Peru 88.3% of total CDM projects registered.
The economic growth and energy consumption in Latin America
The past decade was the best in economic terms of the modern history of the region. An overwhelming majority of countries showed growth rates, allowing the improvement of their social situation and the rise of millions of people in poverty towards the new middle class. Consequently, Latin America has reproduced certain growth patterns that affect heavily on environmental and social issues: the higher levels of demand for energy.
The renewable energy projects in Latin America that have received CDM revenues was generation from hydro, wind, geothermal, landfills, and biomass from sugarcane production.
Brazil
México
Peru
Chile
Contribution CDM projects registered
49%
28%
15% 9%
Energy Industries (renewable/ non renewable sources)
51%
18%
13%
Hidro power plant (HPP)
24% 4%
30%
41%
Small hidro power plant (SHPP)
91% 1% 5% 3%
WIND
Landfill
14%
73% 8%
Biomass
72%
22%
Solar 0%
50%
36%
Others
65%
12%
* until april 2016
Renewable energy policies in Latin America
Latin American countries have begun to promote renewable energy with incentives and mandates. The four countries created public policy that influenced the development of CDM projects in renewable energy. However, the most important barriers to project development are politically and bureaucratically related. The political-institutional barriers of a lack of a long-term vision for energy policy that incorporates renewable, closed electricity markets and frequent and abrupt political upheaval may seem like insurmountable challenges to project development.
Tax Incentives
Brazil
Chile
Mexico
Peru
VAT exemption
Exemption from tax on fuel
Exemption from income tax
Tax benefits import/export
National exemption from local taxes
Carbon tax
Accelerated depreciation
Other tax benefits
National policy
Brazil
Chile
Mexico
Peru
Renewable energy target
Strategy/renewable energy law
Law /solar thermal program
Law /solar program
Law / wind energy program
Law / geothermal energy program
Law / Biomass Program
Law / biofuels program
Conclusions
References
The paper shows the effort of the four countries studied to building the institutional-political capacity to encourage the development of CDM projects in renewable energy sector. Furthermore, the economic context and demand for energy spurred investments in this sector. However, each one of the four countries needs to face important obstacles in order to advance in the environment topic and contribute to climate change mitigation.
Lokey, E. (2012). Renewable energy project development under the clean development mechanism: A guide for Latin America. Routledge..
UNFCCC - United Nations Framework Convention on Climate Change (2016). CDM Project activities.
WORLD BANK. (2016) Global Database.
Acknowledgements
This work was supported by the National Council of Scientific and Technological Developments (CNPq), Brazil.