The shift toward a low-carbon economy has driven greater reliance on electricity, with renewable sources playing an increasingly central role in meeting rising global demand. This transformation, while beneficial for reducing emissions and fostering innovation, has also revealed weaknesses in power infrastructure, particularly in maintaining consistent supply during periods of stress. Ensuring energy resilience now demands not only advanced technology but also strong coordination among governments, regulators, private firms, and international bodies. n nIn Latin America, a stable and adaptable power system is essential for sustained economic development and improved quality of life. Over the past decade, decarbonization efforts and widespread electrification have reshaped the energy landscape. Renewable integration has delivered economic and environmental gains, yet it has also contributed to more frequent large-scale blackouts, as seen recently in Spain, Portugal, Brazil, and Chile. These incidents highlight that dependable energy systems cannot be assumed—they must be deliberately designed. n nModern grids face new challenges due to the variable nature of wind and solar power, which lack the inherent stability—known as inertia—that conventional generation provides. Inertia helps maintain grid frequency during sudden disruptions, and its absence increases the risk of cascading failures. Addressing this requires deployment of large-scale storage, smart control systems, and digital monitoring tools to manage increasingly complex networks. n nThe scale of change needed is immense. According to research firm DNV, global grid capacity must expand to 2.5 times its current level by 2050, with annual investments rising above $970 billion. This growth must be guided by resilience as a core principle, not an afterthought. Furthermore, energy security can no longer be confined within national borders. Regional grid interconnections serve as strategic assets, enabling shared reserves, cost reductions, emergency response, and smoother integration of clean energy. n nAlthough sovereignty concerns exist, real-world examples like Europe demonstrate that cross-border links, supported by aligned regulations, enhance both reliability and the pace of decarbonization. In Latin America, initiatives such as the Central American Electrical Interconnection System and the Northern Arc Interconnection Initiative are advancing joint investments, standardized technical protocols, and unified operational frameworks—laying the groundwork for a resilient regional network. n nAchieving this vision also depends on updating regulatory environments and creating new financing models. As highlighted in a joint report by the World Economic Forum and the Inter-American Development Bank, over $30 billion per year in grid investment will be required through 2035, with two-thirds expected from private sources. Green transmission standards, digital intelligence, and high-voltage direct current (HVDC) links offer pathways to improve flexibility and reduce expenses. Institutional reforms—such as predictable permitting, transparent governance, and coordinated planning—are equally vital to link national systems into a unified, shock-resistant regional grid. n nTraditional infrastructure alone cannot ensure reliability. Flexible AC transmission systems, decentralized generation, battery storage, and innovative digital platforms are now essential for providing backup and adaptability. The Interconexión Eléctrica S.A. 2040 Strategy exemplifies this shift, prioritizing smart infrastructure, distributed energy resources, and storage solutions to strengthen supply continuity. n nClimate resilience is another critical factor. With extreme weather events becoming more common, power systems must be built to withstand disruptions. This calls for adaptive regulations, climate-informed planning, and infrastructure designed for long-term durability. n nUltimately, reliable electricity is foundational to economic vitality and social progress. Consistent power enables industrial innovation, business expansion, and access to essential services. For Latin America, the route forward is clear: building interconnected, agile, and dependable grids is key to ensuring the energy transition supports competitiveness, sustainability, and broad opportunity. Without sufficient investment in resilience, the shift to clean energy risks becoming unstable and uneven. By enhancing regional cooperation, adopting flexible technologies, and advancing policy coordination, the region can create an energy future that is not only low-carbon but also secure, affordable, and enduring. n— news from The World Economic Forum
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Building energy reliability into the low-carbon economy
The transition to a low-carbon economy has accelerated electrification and increased global power demand, with renewables often meeting this need. n nIn this environment, building energy resilience requires technical expertise, but also collaboration, leadership and planning. n nIn Latin America, a reliable and resilient electricity system can create a solid foundation for economic growth and social wellbeing. n nThe global energy transition and the decarbonization of the economy have set the course of the electricity sector over the last decade. Accelerated electrification and the large-scale integration of renewable energy sources have delivered undeniable environmental and economic benefits. But these advances have also exposed critical vulnerabilities in power systems that are increasing the frequency of large-scale blackouts. n nIndeed, recent outages in Spain, Portugal, Brazil and Chile serve as reminders that energy reliability cannot be taken for granted. Energy resilience goes beyond technical expertise to encompass collaborative leadership, risk prioritization and coordinated planning among governments, regulators, companies and multilateral institutions. n nIn the current environment of climate uncertainty and technological disruption, trust and institutional alignment are as essential to energy reliability as physical infrastructure. n nIntegrating renewable energy n nVariable renewable energy, while clean and cost-competitive, lacks the inertia that traditional power generation provides. Inertia is a system’s ability to withstand sudden frequency deviations, something that becomes more common as variable resources are added to the grid. Its absence increases the risk of instability and cascading outages. Addressing this inertia challenge requires advanced control technologies, large-scale storage and digital intelligence to stabilize increasingly complex grids. n nThis transformation is unprecedented in scale. To securely integrate renewable energy, research company DNV estimates global grid capacity must grow to 2.5 times its current size, with annual expenditure more than doubling to $970 billion by 2050. This expansion calls for a structural redesign in which resilience is a guiding principle rather than an afterthought. n nEnergy reliability can also no longer be thought of as a purely national issue. Regional interconnections should be regarded as strategic infrastructure for resilience and security. Integration reduces costs, allows sharing of reserves, mitigates emergencies and facilitates large-scale renewable integration. n nAlthough concerns about sovereignty and dependence are valid, international experience shows otherwise. In Europe, cross-border interconnections coupled with robust regulatory harmonization have strengthened system security and accelerated the clean energy transition. n nFor Latin America, organizations including the Central American Electrical Interconnection System and the Northern Arc Interconnection Initiative are already promoting coordinated investments, common technical standards and shared operational frameworks. They are taking vital steps toward a regional architecture of resilience. n nEnabling the next phase of energy resilience n nAs emphasized in the recent World Economic Forum and Inter-American Development Bank report Advancing Latin America’s Power System Transformation, achieving such resilience also depends on the modernization of regulatory frameworks and the creation of innovative financing mechanisms to expand and digitalize transmission networks. The report highlights that more than $30 billion per year in grid investments will be needed through 2035 – two-thirds from private capital – to ensure secure integration of renewables in Latin America. n nIt also underscores the potential of green transmission standards, digital intelligence, and high voltage direct current (HVDC) interconnections to enhance operational flexibility and lower costs. In this vision, energy resilience is inseparable from institutional innovation in building predictable regulations, transparent permitting and coordinated planning that link national systems into a cohesive regional grid capable of withstanding both climate and market shocks n nResilience today cannot rely exclusively on traditional transmission assets. Flexible alternating current transmission systems, decentralized solutions, energy storage and new digital business models are central to providing flexibility and backup capacity. The Interconexión Eléctrica S.A. 2040 Strategy reflects this approach, incorporating energy storage, distributed solutions and smart infrastructure as critical enablers of energy reliability. n nIt’s equally important to prepare for climate change. Extreme weather increasingly threatens grid continuity, creating even more need for climate-resilient infrastructure, adaptive regulatory frameworks and scenario-based planning. n nEnergy reliability as a social and economic imperative n nReliable and resilient electricity systems are foundations for economic growth and social wellbeing. When energy is delivered consistently, industries innovate, businesses thrive and communities gain access to essential services that improve quality of life. n nFor Latin America, the path is clear: Building robust, interconnected, flexible, and – most importantly – reliable grids is the only way to ensure that the energy transition becomes a true driver of competitiveness, sustainability and opportunity. Failure to invest in resilience risks turning the transition into a fragile and uneven process. n nBy strengthening regional interconnection, investing in flexibility technologies and advancing regulatory dialogues, the region’s energy transition will not only be clean and sustainable, it can be affordable, secure, resilient and reliable – and a true engine of progress for future generations.