The key role of Latin America and the Caribbean in the energy transition

Latin America and the Caribbean account for around 25% of world production of the minerals considered critical for the energy transition, so their role in this process is vital, according to a study carried out by Latin American energy organization Olade.

The study states that the region hosts around 45% of global copper production and 38% of total reserves, 29% of lithium production and 61% of reserves, 48% of silver production and 39% of reserves, and 38% of nickel production and the same proportion of reserves of the metal.

“This shows that the presence of Latin America is crucial for several minerals,” study author Gastón Sirdit said during his presentation of the information. “It is important that the region converts its natural resources into development.”

Olade warns that Latin America and the Caribbean will have to double their copper production by 2050 and multiply lithium output by a factor of 10 in the next 20 years.

The study also points to the significant challenges to make the mining industry sustainable.

Among the most important of these obstacles is ensuring that mining is naturally integrated into regions without displacing communities, damaging ecosystems or threatening species in danger of extinction; preventing mining projects from generating a disproportionate increase in the cost of living, which leads to greater poverty and migration; improving worker safety; minimizing the use of fossil fuels; and taking greater care of resources, including water.

The challenges also include the need to connect mining areas with major export corridors, and developing mining areas with infrastructure services to generate short- and long-term opportunities, according to Olade.

Meanwhile, governance objectives include shortening times needed for administrative procedures, ensuring fair redistribution of mining royalties to support socioeconomic and industrial growth, and preventing the growth of corruption.