Wind energy in Latin America, a prime territory for the deployment of wind power

Latin America, a region of great cultural and economic diversity, has some of the world’s best wind resources. Home to many growing economies with increasing electricity demand, this part of the world is considered prime territory for the deployment of wind power.

While beginnings have been modest, there are now concrete signs that the region is on the verge of developing a substantial turbines power industry to complement its rich hydro and biomass (and potential solar power) resources, most notably in Brazil and Mexico.

The total installed wind farm capacity in Latin America grew by 50% during 2010, and more than 2,000 MW of wind power are now operating across the region.

Wind power is making the most progress in Brazil, the region’s largest economy. This country has many areas with tremendous potential for wind energy, combined with a growing electricity demand and solid industrial and grid infrastructure. As a country with a large share of hydro power, this combination forms an ideal basis for large-scale wind power development.

At the end of 2010, 930 MW of wind farm capacity were operating in Brazil, with a project pipeline of more than 4,000 MW up to 2013, most of which were contracted in the 2009 and 2010 auctions. Two new auctions have already been announced for June 2011. Since the December 2009 auction, seven major international manufacturers have committed to building production facilities in Brazil, most of which are already under construction.

Brazil is set to not only be the largest wind power market in the region, but will also be a major wind turbines manufacturing hub for the region.

Mexico, too, has an outstanding wind resource, especially in the Oaxaca region, but also in Baja California as well as in other regions. Mexico’s installed wind farm capacity has increased more than 6-fold since the end of 2008, and 316 MW of new wind farm capacity were added in 2010 to reach a total of 519 MW.

Argentina’s wind resources are unrivalled in the region, and are estimated to be sufficient to supply Latin America’s entire electrical demand several times over. However, to date, only a tiny amount of the potential has been developed with just 60 MW of wind power operating, up from 33.5 MW at the end of 2009.

Another promising market is Chile, which had nearly 172 MW of wind power in operation at the end of 2010. A number of large wind farm projects are under development, and they are desperately needed to help alleviate chronic gas shortages.

Uruguay is also starting to develop its wind resource and added 23 MW of new wind farm capacity for a total of 43 MW at the end of 2010. The country has a target of reaching 500 MW by 2015.

Other wind power markets in the region include Costa Rica, which had about 123 MW of wind power at the end of 2010, and a new 50 MW project in the pipeline; Peru, which had nearly 150 MW under construction at the end of 2010; Venezuela with 100 MW currently under construction, scheduled to come on line in 2011; Jamaica, with 24 MW installed capacity; Nicaragua, which installed 40 MW of wind power in 2009; and Honduras, with 102 MW wind farm under development, due to come online in 2012.

Unfortunately, however, most of these early wind energy markets suffer from the lack of a clear, long-term policy framework for wind power development which continues to hamper market development.