Latin America’s abundance of natural resources, which are already successfully harnessed in numerous hydro projects, and its scope for producing smart biofuels make the region ripe for investment in renewable fuels. Spending is expanding fast in the region. Hindrances to yet faster growth include unrealistically low tariffs on energy consumption, an uncertain and volatile investment climate and weak access to good-value, long-term financing.
The high cost of fossil fuels – both in terms of price as petroleum hovers at about $120, and in terms of environmental damage – is pulling a new breed of global investor into renewable energy. But there is a long way to go: renewables represented a meagre 1.5% of installed capacity worldwide in 2004.
