MONTEVIDEO, Uruguay—The South American country of Uruguay relies almost entirely on renewable energy for its electricity, and it needs others to do the same. Through smart alchemy, he plans to use offshore oil platforms to generate wind power to produce green hydrogen. .
This may sound like a dream task for the U. S. government. The U. S. government has prioritized renewable energy production abroad, adding in Latin America. But as Uruguay seeks loans from Washington for its oil infrastructure, it has been blocked by U. S. restrictions. “The U. S. is in the so-called high-income countries. ” If we had support, we could move much faster,” Ignacio Horvath, executive director of ANCAP, Uruguay’s state-owned electricity company, told Foreign Policy.
Uruguay is not alone. Most Latin American countries are classified as superior or compatible with a middle-income source through the World Bank on the basis of a capita-compatible source of income. Guatemala, the Bahamas and Paraguay fall into one of those categories. This means that although Latin America is rich in renewable energy potential, the region is not eligible for many types of U. S. investment. UU to take advantage of its sun and wind. This includes Caribbean countries suffering severe climate impacts, adding increasingly intense hurricanes and emerging sea levels, and eager to continue leading the global response to climate change.
MONTEVIDEO, Uruguay—The South American country of Uruguay relies almost entirely on renewable energy for its electricity, and it needs others to do the same. Through smart alchemy, he plans to use offshore oil platforms to generate wind power to produce green hydrogen. .
This may sound like a dream task for the U. S. government. The U. S. government has prioritized renewable energy production abroad, adding in Latin America. But as Uruguay seeks loans from Washington for its oil infrastructure, it has been blocked by U. S. restrictions. “The U. S. is in the so-called high-income countries. ” If we had support, we could move much faster,” Ignacio Horvath, executive director of ANCAP, Uruguay’s state-owned electricity company, told Foreign Policy.
Uruguay is not alone. Most Latin American countries are classified as superior or compatible with a middle-income source through the World Bank on the basis of a capita-compatible source of income. Guatemala, the Bahamas and Paraguay fall into one of those categories. This means that although Latin America is rich in renewable energy potential, the region is not eligible for many types of U. S. investment. UU to take advantage of its sun and wind. This includes Caribbean countries suffering severe climate impacts, adding increasingly intense hurricanes and emerging sea levels, and eager to continue leading the global response to climate change.
The U. S. government The U. S. and multilateral development banks have long-standing regulations limiting lending to high- and upper-middle-income countries in Latin America. These obstacles are short-sighted because Latin Americans overwhelmingly recognize the threats of climate change. that 80% of other people in Mexico, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama, weather replaces a serious threat. Public opinion is likely to become even more supportive as the weather impacts, as the prolonged drought tormenting farmers in Argentina, Brazil and Paraguay worsens in the region.
As a result, Latin American governments are willing to announce renewable energy projects, either for economic purposes or to combat climate change. In Chile, Environment Minister Maisa Rojas helped draft the latest flagship report of the United Nations’ Intergovernmental Panel on Climate Change. In Colombia, President Gustavo Petro campaigned to devote himself to halting oil exploration, even though the sector generates nearly a quarter of export earnings. and the Caribbean to fill the position.
However, there is no doubt that Latin American governments want a bit of flavor to advance a green agenda. This was evident during the pandemic, when governments invested stimulus budgets in classic industries, adding hydrocarbons. This is even more true today, as the region’s recovery is weighed down by a COVID-19 hangover, peak inflation, a strong dollar, emerging interest rates, and food and energy crises. These demanding situations have left a scarce public budget for investments in renewable energy generation, electric power transmission infrastructure, energy storage capacity and electromobility. In most countries, there is still reluctance to reduce costly fossil fuel subsidies, discouraging renewable energy projects.
U. S. restrictions U. S. Renewable Energy Industry in Latin America also deprives the U. S. of Renewable Energy Industry. UU. de a vital diplomatic tool in Washington’s standoff with Beijing over regional influence. renewable power technologies and electric vehicles. For example, Argentina is a longtime wife of the United States in South America, but in its high-altitude desert in the northwest, it is China that has built the largest solar power plant in the region. In nearby salt marshes, Chinese corporations control much of the coveted lithium through battery and electric vehicle corporations.
To be fair, Biden’s leadership recognizes this problem. In June, at the Summit of the Americas, U. S. Secretary of StateU. S. Secretary of State Secretary Antony Blinken promised to encourage multilateral agencies to expand financing functions for the region’s middle-income economies, which are facing demanding situations of progression. however, they are excluded from many types of foreign monetary support. He repeated that promise of a South American vacation last month. Treasury Secretary Janet Yellen has called for a comprehensive review of how progressive multilateral banks address issues, such as climate change, that require other approaches to poverty reduction.
An option for the U. S. The U. S. would welcome the next president of the Inter-American Development Bank, who will be elected in November, with a capital buildup that would expand lending for renewable energy projects. But in the meantime, the U. S. itself. The U. S. government can simply help address this challenge through its own barriers to financing high- and middle-income countries in Latin America.
Historically, U. S. monetary progression has taken place in the U. S. The U. S. government has been designed to fight poverty. Proponents of this strategy point to the immense and growing desires in much of the world. In 2020, the pandemic pushed 70 million people into extreme poverty, the largest single-year accumulation in decades. The United States has ethical and pragmatic interests in reducing poverty abroad.
That said, the latest U. S. progress office, the International Development Finance Corporation (DFC), aims to have a broader mission. Established in 2019, the DFC is designed not only to combat poverty, but also to supply “state-led investments. “through authoritarian governments,” in other words, Chinese loans. It does this through loans, loan guarantees, fair investments, feasibility studies and technical assistance. Its superior profile has raised expectations that the company will be the main American tool to compete with Beijing’s Belt and Road Initiative, a precedent for the U. S. The US and its G-7 allies. It has the ability to make transformative investments in renewable energy.
However, the DFC should give priority to low- and lower-middle-income countries, with rare exceptions. The DFC Board of Directors includes a Director of Development. In Latin America, it doesn’t work at all in much of the Caribbean or in Chile, Panama, or Uruguay: 3 U. S. Democratic Partners. U. S. Supply Chains are well placed for the “shoring friend” of U. S. supply chains. U. S.
There are calls to make the DFC, as well as the US Export-Import Bank, more flexible lenders to more temporarily combat opposition to the China Development Bank and the Export-Import Bank of China. In practice, despite procedural hurdles, the DFC already lends to upper-middle-income countries for this purpose, so much so that anti-poverty advocates have complained about its “drift to Foggy Bottom,” the home of the U. S. State Department. U. S.
The U. S. Congress The U. S. has already made at least one exception in particular. In 2019, to decrease Europe’s dependence on Russian oil and herbal gas, lawmakers allowed DFC to push projects in Europe, regardless of beneficiary consistency with capital income.
It deserves to do the same for renewable energy projects everywhere, and the White House deserves to find other tactics to fund renewable energy projects and attract personal investments in this sector in Latin America, a battleground for the renewable energy festival that has enormous renewable energy potential and wonderful economic need.
The renewable energy sector in Latin America is developing without significant support from the US. This is the way to the U. S. , but at the speed and scale needed to meet the goals of the Paris Agreement. More than a quarter of its energy comes from renewable sources, double the global average. Time, there are countless large-scale renewable energy projects stuck in boardrooms waiting for funding.
Although Uruguayan officials left meetings with the U. S. government empty-handed. In the US, the country’s ambitious green hydrogen projects are moving forward. The governments of China and Europe have expressed interest in supplying electrolysis apparatus – to separate water into hydrogen and oxygen – and in the production and use of fuels, received through the mixture of carbon monoxide and hydrogen.
But the country hopes to reallocate a large part of the oil industry’s infrastructure, and its dependence on the public budget has slowed that transformation. “We see prospects everywhere,” Horvath said.
Benjamin N. Gedan was South American director of the National Security Council and deputy director of the Wilson Center’s Latin American program.
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