What could Climate Change mean for Hydropower in Central America?

Climate change
Environmental Economics
Infraestructure - Transport - Water

One of the most important challenges that Central America (and the LAC region in general) faces this decade is being able to close the infrastructure gap with investments that are sustainable and climate resilient, while encouraging economic growth in the region. In an era of climate change, where too much or too little water is likely to be a leading issue, a sector that is particularly interesting to look at is hydropower.

Hydropower is a very important source of energy for the Central American region, accounting for approximately 50% of the electricity generated in the region and with significant investments planned for the next 10 years. At the same time, climate change studies are projecting changes in precipitation patterns, temperature, and water availability in the region that could impact the sector.  How should the region prepare for climate change, particularly in sectors with often large, long-lived investments, and where water is a main input of production? Could improvements in the operation of hydroelectric infrastructure be enough to continue the sustainable use of water resources in a climate of high variability and in a context of uncertainty?

The region is actively thinking about this topic. At the request of the Ministries of Energy in Central America, and together with the Latin American Energy Organization (OLADE) and the Energy and Environment Alliance with Central America (AEA), the IDB through SECCI provided financial and technical support for the study “Vulnerability of hydroelectric production systems to climate change in Central America and their adaptation options”. The goal of this study was to develop, with active participation from technical professionals and officials in the region, a methodology to better understand and study in more detail the implications of climate change in this sector, as well as to identify potential actions to address it.

Most climate change scenarios available for Central America foresee a decrease in precipitation for a large part of the water basins in region, along with a progressive temperature increase, which would significantly affect future hydroelectric production by influencing the amount of available resources. However, the present study does show that climate change does not necessarily disqualify hydropower as a valid expansion option for the generation system in all cases, since the early planning and implementation of adaptation and cost-effective measures in response to observed and expected impacts can bring significant benefits to projects and communities. What is clear in this study is that the subject is sufficiently important to deserve its consideration from the design table of a new hydroelectric plant, and as part of an integrated energy planning system, so as to ensure its long-term sustainability.

Adaption to climate change needs a flexible and long-term approach, where diagnostics and interventions can be analyzed through a learning process. This study represents a first step in the analysis of a complex subject, in a sector that also has many other variables.

This post first published in the Blog Cambio Climatico - Let's talk about Climate Change, on December 15, 2016.

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