Latin America's Green Energy and Mining Boom: What's Next?

Latin America is becoming a hotspot for green energy and mining. The region is seeing a lot of interest from investors. This is because it has a lot of potential in renewable energy and critical minerals. Over 65 percent of Latin America’s electricity now comes from renewable sources. This is much higher than the global average. Hydropower is the biggest source of renewable energy in the region. It makes up about 45 percent of the electricity. Countries like Costa Rica and Paraguay are almost fully powered by hydropower. In recent years, there has been a lot of investment in solar, wind, and bioenergy projects. These projects have helped to diversify the region’s energy portfolio. Wind and solar power now contribute around 17 percent of the region’s electricity. Several governments have set net-zero carbon emissions targets. This makes the region attractive for investors. Latin America has also seen a lot of investment in its mining sector. This is because of the growing demand for critical minerals. These minerals are needed for renewable energy and electric vehicles. In the first three quarters of 2025, global mining mergers reached $30 billion. 74 percent of this went to Latin America.However, there are still challenges. The World Economic Forum’s Energy Transition Readiness Assessment 2025 showed that Latin America’s sustainability and equity scores are strong. But progress on energy security and enabling conditions is lagging behind. Some countries are still heavily reliant on fossil fuels. Greater investment in energy infrastructure is needed to support the shift to renewable energy. While Latin America is attracting interest in its mining sector, investment in green energy still falls behind other parts of the world. The World Economic Forum estimates that clean energy investment in 2025 totalled $70 billion. This is around 4 percent of global investment in the sector. To support sectoral growth, Latin America requires around $150 billion a year in investment by 2030. To attract higher levels of investment, countries must address challenges such as high interest rates. They must also address regulatory uncertainty and streamline regulatory and licensing processes for investors. Greater investment in education and skills development is also needed. There is a persistent skills gap in several countries. This makes it difficult to deploy higher levels of renewable energy. Latin America and the Caribbean have made strides in renewable energy development and mineral mining. However, greater private investment will be required to expand the region’s renewable energy capacity. This is to meet the anticipated demand growth in the coming decades.