Latin America: Leading the Hydroelectric Industry

By Brynna Boyer

Within the past few years, the world has become quite concerned with mainstreaming the adoption of sustainable energy in an ever-increasing bid to reduce environmentally harmful carbon emissions.

Solar, wind, and geothermal power (amongst many other sustainable energy sources) have grown into a massive industry in the past few decades as people find it increasingly important to invest in a future of sustainable energy. Amongst this widening interest in a sustainable future, hydropower has emerged as a strong contender within the zeitgeist of environmental conservation.

Hydroelectricity, electric power created by the force of falling or flowing water, is the world’s largest source of renewable energy. Within the past century, it has been utilised as a sustainable means to meet the world’s soaring demand for electricity. In fact, it is so ubiquitous that it comprises nearly 85% of the international renewable electricity supply.  

As people are becoming more concerned about the environmental future of the Earth, countries are ramping up their production of sustainable energy- and rightly so. Using hydroelectricity exclusively, instead of coal, each year will avoid 148 million tonnes of pollution particulates, 62 million tonnes of sulphur dioxide, and 8 million tonnes of nitrogen oxide.

Hydropower provides reliable and affordable means of producing clean energy, and deserves greater investment in the future. It also promotes economic development and job opportunities in rural areas that would otherwise not be overlooked by government budgets.

Furthermore, the dams and reservoirs used to generate hydroelectric power offer additional environmental and social benefits such as flood control, irrigation for farming, water supply storage, and public recreational uses.

In Latin America, hydropower has become the main source of power production, accounting for roughly 65 percent of all electricity generated in the region.

In 2020, South America’s installed renewable energy capacity expanded by more than 4.1%, as it refused to be affected by the otherwise crippling effects of the coronavirus pandemic. 

Latin American countries reported a combined clean generation capacity – which has a majority of hydropower – of 233GW on December 31, 2020 (up from 224GW a year earlier). 

The region has also emerged as the global leader in the production of hydroelectricity, producing the highest percentage of the sustainably sourced electricity in the world. Brazil alone surpassed China as the world’s largest producer of hydroelectricity in 2019, and has retained its champion title through 2020 and into 2021.

Brazil’s tremendous network of dams and reservoirs has an installed hydropower capacity of 100,273 MW, which meets over 75% of the country’s electricity demand. The country is home to three of the world’s largest dams, and still plans to further expand.

Even though Brazil has been unrivalled in the global stage for the past few years, other Latin American countries are quickly catching up. Of the 412 dams built, under construction, or proposed in the Amazon basin in 2015, 77 were in Peru, 55 in Ecuador, 14 in Bolivia, six in Venezuela, and two in Guyana. Meanwhile, Chile, Argentina, Bolivia, Costa Rica, Nicaragua, Panama, El Salvador, and Honduras are also all building large dams in order to increase hydroelectric production.

Latin American countries have also shared hydroelectric plants amongst themselves, a notable one being the Itaipu plant on the border between Brazil and Paraguay. The hydropower plant is located on the Parana River, at the border between Brazil and Paraguay. It consists of 20 generating units with a capacity of 700MW each. It produced 103.1 million MWh in 2016, making it the biggest generating hydropower plant in the world.

The Itaipu hydroelectric facility supplied 15% of Brazil’s energy consumption and 90% of the energy consumed in Paraguay in 2018. Through this shared plant, the importance of hydropower to Latin American countries is clearly demonstrated, especially in Paraguay.

With these staggering numbers proving Latin America’s proclivity at generating sustainable energy through water, it is worth exploring how the region became so dam good at generating clean energy.

South America has the ideal geography and climate to promote the production of hydroelectricity. With no shortage of rivers and basins within the continent, as well as near constant rainfall, there are ample opportunities for the generation of power through water.

Hydroelectric plants also allow countries with questionable infrastructure the luxury of electrical stability. The plants are able to go from zero to maximum output in virtually no time at all. Thus, Latin American countries are provided with essential back-up power during major electricity outages or disruptions.

Hydroelectricity is beneficial to Latin American countries, as it enables them to produce and supply their own energy at a national level. In a region where national infrastructure is fragile in the best of times, countries do not have to worry about affording power supplies from other areas of the world.

Being produced through domestic waterways- hydroelectricity reduces the region’s dependence on international sources of fuel, while also creating employment opportunities for citizens, leading to further economic development.

Dams and hydroelectric power production in South America have also been employed by countries as symbols of national pride and economic progress. Politicians, to rally the national sentiments of their voter base, point out that hydropower has reduced poverty, sated an urgent demand for electricity and clean water, and allowed countries to industrialise and urbanise rapidly and cheaply.

Remote areas of the continent have been opened up to greater economic development through the construction of dams, and clean hydroelectricity, as previously mentioned, is the most efficient and reliable way to provide energy security, store critically needed water, and control the flow of rivers.

It is also considered that the recent development of Latin America, and notably Brazil, is leading the global hydroelectric industry, thus further fuelling regional and national sentiments of pride and accomplishment. A feeling regional politicians surely wish to cultivate.

Hydropower has proven to be a reliable, sustainable, and even beneficial source of energy, thus fuelling the Latin American drive to further develop their hydroelectric infrastructure. With its bevy of rivers, the region is naturally suited to the production of the sustainable energy source.

As the fight against climate change comes to a head around the world, it would be foolish for South America to not capitalise on the reliability and economical development hydroelectricity provides.

The views expressed in this article are the author’s own and may not reflect the opinions of the St Andrews Economist.

Image source: Francisco Kemeny via Unsplash

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