11 May What can Bolivia learn from Uruguay and Afghanistan?
There are few discourses, especially political-party ones, that navigate safer waters than those invoking the shift in the energy matrix toward so-called “clean energy.” Whether you are at a major international conference, presenting at a Zoom meeting, or simply adding flair to a family lunch, using words like “solar energy,” “biofuels,” and “energy efficiency” will almost certainly leave a positive impression.
The reason for this is clear: there is a certain global consensus, particularly among younger generations, on the need to reduce environmental pollution caused by fossil fuel consumption. This “global awareness” stems from abundant statistical data highlighting the urgency of finding more environmentally friendly ways to charge your phone or commute to work every day.
In this context, how are we doing in Bolivia? To answer this question, I must undertake the thankless task of establishing a point of comparison. Simply put, we need to compare ourselves to another country, which inevitably introduces a subjective component.
That said, I’d like to compare Bolivia to Uruguay, and both to South America as a whole. Uruguay not only appeals to me for the quality and warmth of its people, Benedetti, and its barbecue culture. From an energy perspective, it stands out positively. I encourage you to pay attention to this country when reviewing international comparative charts; you’ll be pleasantly surprised.
Below, I will present statistics on energy consumption and efficiency. The source of information is the comprehensive database of the Latin American Energy Organization (OLADE).
Figures 1, 2, and 3 show energy consumption (by source) for 2019 in Bolivia, Uruguay, and South America. How do you interpret these figures? In Bolivia’s case, 85.4% of all final energy consumed came from fossil fuels—natural gas and petroleum derivatives; 10.5% was sourced from electricity (which itself is generated mainly from natural gas or hydropower), and the rest came from other sources. While the increased use of natural gas is progressing, it remains a fossil fuel.
Now, let’s look at Uruguay (Figure 2). While fossil fuel consumption is significant (37.8% from petroleum derivatives), the use of solar, wind, and other renewable energy sources represents 27.5% of the total, a comfortable second place. Electricity accounts for 20.7%, and almost all this electricity comes from hydropower—unlike in Bolivia, where over 50% of electricity is generated by burning natural gas.
Finally, for South America (Figure 3), we see that its dependence on fossil fuels for final energy consumption is high: petroleum derivatives and natural gas exceed 60%. Electricity consumption accounts for 19.8%, with less than half generated in hydropower plants. Simply put, South America’s final energy consumption heavily relies on fossil fuels. This makes Uruguay’s performance even more remarkable.
Figure 1
Figure 2
Figure 3
Let’s move to another indicator, this time related to energy efficiency: Energy Intensity, which measures how much energy (in barrels of oil equivalent) is consumed per USD 1,000 of Gross Domestic Product (GDP). How do we interpret this indicator? High values imply lower energy efficiency because a high value indicates the country requires a lot of energy to generate USD 1,000 in “wealth.”
Figure 4 shows this indicator for Bolivia, Uruguay, and South America. As expected, Bolivia scores much higher than Uruguay, while Uruguay scores lower than South America, making it the most energy efficient. These figures are typical for net energy-producing and net energy-importing countries. In Bolivia’s case, as a net energy producer (we can afford to export natural gas), there’s a tendency to use energy inefficiently—see the striking Figure 5.
It’s not uncommon to hear people say, “I got home and turned on the TV just so I wouldn’t feel alone.” Here’s a challenge: do you know how many kWh your household consumed last month? If you don’t, it’s because you’re not paying attention to your electricity consumption. In contrast, in net energy-importing countries, people tend to be more efficient and conserve more—because importing energy is expensive. Do you know where people are very aware of how much electricity they consume? In Afghanistan. This country, dear to me, imports almost all its electricity at extremely high prices. Consequently, consumers pay those prices—some of the highest in the region—and save every last kWh.
Figure 4
Figure 5
When a society relies on subsidized energy prices, it often uses energy inefficiently and becomes entrenched in a dependency on fossil fuels. Conversely, when energy prices reflect both production and environmental costs, societies are incentivized to use energy more efficiently and to explore innovative and sustainable energy sources.
What’s the catch? A presidential, gubernatorial, or mayoral candidate will use the discourse of clean energy and greater efficiency to win votes but will struggle to talk about removing subsidies—because, dear reader, that doesn’t win sympathizers. So, in conclusion, who should change: the candidate who promises what people want, or the people who demand such promises from the candidate?
S. Mauricio Medinaceli Monrroy
La Paz
May 11th, 2021
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