By: Racquel Moses, CEO, Caribbean Climate Smart Accelerator
The Caribbean is responsible for a negligible share of global carbon emissions, yet finds itself at the forefront of climate change impacts. Adapting to these challenges means reducing the amount of carbon emissions emitted within the region and creating a sustainable economic model that values our environment and the communities that rely on them. A popular project being undertaken across the Caribbean is the development of a Blue Economy to conserve key economic drivers such as tourism, fisheries or agriculture – but there is a much larger opportunity waiting to be taken up.
Decarbonizing the Caribbean
The transportation and energy sectors are responsible for almost a quarter of total greenhouse gas emissions in the Caribbean and Latin America. Transport emissions have proven difficult to reduce, but renewable energy production has improved leaps and bounds. Latin America has had more success in developing their renewable energy sector, with over half of all power generation based on clean energy, but the Caribbean still has a lot of untapped potential that could see it match its neighbors’ clean energy output.
Hydrogen technology is being developed globally to replace fossil fuels and support the transition to a low-carbon future. The use of hydrogen can help close the gap on our emissions ambitions, however, there are avid discussions as to how clean the fuel can be depending on its source. Hydrogen is created by splitting water into its base components, a process that requires a lot of energy – therefore, using fossil fuels to create hydrogen provides several dilemmas. That being said, green hydrogen, which is created from renewable resources, makes up less than 1% of hydrogen creation in the United States.
As such, the Caribbean Single Energy Export Market provides the region with a unique opportunity to reduce our dependence on fossil fuels, decarbonize our energy sector, and build resilience to climate impacts.
As such, the Caribbean Single Energy Export Market provides the region with a unique opportunity to reduce our dependence on fossil fuels, decarbonize our energy sector, and build resilience to climate impacts. The Export Market would see countries connect in a multipoint, multi-directional pipeline of renewable energy contributed solely by Caribbean nations, and could have the potential to create green hydrogen for export. Within a larger context, this would contribute to global net-zero goals, and contribute to the drop in carbon emission Latin America and the Caribbean have enjoyed since 2014.
Developing Local Solutions
An opportunity explored at the Trinidad and Tobago Energy Conference In June, the creation of the Caribbean Single Energy Export Market would herald a new era in the region’s renewable energy history. It would capitalize on the natural resources, create a collaborative energy framework linking several governments, communities and power grids, while producing clean electricity and creating green jobs. The production of green hydrogen would also make the region the first in the world to export clean hydrogen at scale. This could create a new economic base for the Caribbean and make the most of the local solutions we have available. In tandem with the development of a Blue Economy, and the decarbonization of the transport sector, we could create the world’s first climate-smart zone.
There are other challenges facing the renewable energy sector however, as Martin Vogt , the Managing Director at MPC Renewable Energies highlights, “Caribbean countries need investors. Public-private partnerships provide an opportunity to finance, build and operate clean energy projects that can then be completed sooner or even made possible in the first place.” This being said, financial challenges can be easy to remedy, with private finance having shown a clear interest in helping Caribbean nations reach their climate and resilience goals. Compounded by the fact that renewable energy has continued to beat records in terms of capacity installed globally, there is an active market for renewables, providing investors with unique opportunities – such as the Caribbean Single Energy Export Market.
Regardless of major developments like the Export Market however, CARICOM members are also tied to a regional target of 47% renewable energy by 2027. To reach this target, the International Renewable Energy Agency (IRENA) predicts a 4GW increase in renewable capacity per year, requiring approximately $9 billion USD in additional investments. Here too, collaboration and private finance can help create more efficient projects and policies.
We have the ability to continue actively decarbonizing the region and becoming a global leader in renewable resources – all we need is more collaboration towards innovative solutions.
Developing Caribbean renewable energy opportunities and maximizing local solutions have been key goals for regional governments. The time has come to reach them. We have the ability to continue actively decarbonizing the region and becoming a global leader in renewable resources – all we need is more collaboration towards innovative solutions.