Germany–Latin America: Fostering Strategic Alliances for a Global Energy Transition

Germany is internationally renowned for its Energiewende. The country has been an early adopter of new renewable energy technologies such as wind and solar, which are now fundamentally transforming its electricity system. Germany is, moreover, a large, industrialised country that is globally acknowledged as a ‘green power’ with a high level of technological expertise. Therefore, German efforts to replace conventional energy sources with renewable alternatives have received considerable international attention. At the same time, Germany has many challenges ahead, with its economy still highly dependent on fossil fuels, and difficulties in transforming its heating and transport sectors.

Germany has a strong track record of promoting renewable energy and energy efficiency through international cooperation. Already in the aftermath of the oil price shocks of the 1970s, German development cooperation began promoting non-exhaustible energy sources. Nowadays, Germany is the world’s second largest provider of energy-related development cooperation, after Japan. It has established bilateral energy partnerships with countries that are of strategic value for a global energy transition, and has taken key steps to foster multilateral cooperation for the promotion of sustainable energy. Germany initiated the founding of the International Renewable Energy Agency (IRENA) and has used its past two presidencies of the G7/G8, and of the G20 in 2017, to enhance climate protection within the global energy system.

Under Germany’s presidency in 2017, the G20 made important steps toward fostering a global energy transition. The G20 issued the Hamburg Climate and Energy Action Plan for Growth, which argues for a reliable and secure framework for energy sector transitions consistent with the Paris Climate Agreement. This action plan, however, was not supported by the US, as President Trump had just announced the intention to withdraw from the Paris Agreement. Renewable energies can play a decisive role in global efforts to reduce greenhouse gas emissions: As these technologies bring along important economic and social benefits, they also open up options for political dialogue on the basis of global opportunity sharing.

Latin America is of strategic importance for Germany’s international sustainable energy policies. Sustainable energy technologies not only have a large potential market in Latin America but also offer opportunities to address some of the region’s pressing issues. Moreover, Latin America offers interesting learning opportunities. In several Latin American countries, electricity supply has traditionally been based on renewable energies – namely hydropower. In some Latin American countries, bioenergy has become an important pillar of electricity and fuel supply. New renewable energy technologies such as wind and solar energy have recently gained ground. However, the region also has large oil and gas reserves. With growing energy demand, the expansion of new renewable energies goes hand in hand with rising demand for conventional energy. Moreover, Latin America is a strong voice in global efforts to mitigate climate change. The region is exposed to some of the most severe effects of climate change in the form of droughts, glacial retreat and rising sea levels. Droughts increasingly pose an energy security challenge in Latin American countries that are highly reliant on hydropower. Three Latin American countries are of particular relevance for German efforts to build alliances for a global energy transition: Germany has established bilateral energy partnerships with the regional heavyweights Brazil and Mexico, while Argentina has taken over the G20 presidency from Germany in 2018 and will thus play a central role in shaping the global energy agenda throughout its presidency.