Solar and Wind Power Fuel Latin America’s USD 127.6 Billion Renewable Energy Infrastructure Market

Market Overview

The Latin America Renewable Energy Infrastructure Market reached a size of USD 47.2 Billion in 2024. It is expected to grow steadily, attaining a market value of USD 127.6 Billion by 2033 with a CAGR of 10.80% during the forecast period 2025-2033. Growth is driven by government incentives, favorable policies promoting renewable investments, increasing energy demand due to urbanization and population growth, and abundant natural resources such as solar, wind, and hydro power.

Study Assumption Years

• Base Year: 2024
• Historical Year/Period: 2019-2024
• Forecast Year/Period: 2025-2033

Latin America Renewable Energy Infrastructure Market Key Takeaways

• Current Market Size: USD 47.2 Billion in 2024
• CAGR: 10.80%
• Forecast Period: 2025-2033
• Governments in Latin America support the renewable energy infrastructure market through tax advantages, financial subsidies, and policies, especially in countries like Brazil and Chile.
• Increasing urbanization raises electricity demand, prompting investments in renewable infrastructure to provide stable services and reduce fossil fuel dependency.
• Latin America is well-positioned for renewable energy due to abundant solar, wind, and hydro resources, contributing to global decarbonization goals.
• International development banks and private investors are actively funding renewable projects, enhancing infrastructure development.

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Market Growth Factors

Government Policies and Incentives

The Latin America renewable energy infrastructure market growth is primarily supported by strong government initiatives offering tax advantages, financial subsidies, and other incentives. These efforts promote renewable energy investments, facilitating wind, solar, hydro, and clean technology development. Progressive policies, such as renewable energy auctions in Brazil and Chile, enable new market entrants. A notable transaction includes Vale's sale of 70% of Alianca Energia to GIP for USD 1 Billion to consolidate solar and hydro assets, illustrating the increasing investment momentum in the region's renewable infrastructure.

Growing Energy Demand and Urbanization

The market outlook is strongly influenced by rapid population growth and urbanization, which increase electricity demand and pressurize existing energy infrastructure. Renewable technologies like solar and wind offer scalable solutions in decentralized urban locations, reducing transmission losses and boosting grid reliability. Government and energy company investments, including a USD 1.2 billion U.S. Department of Energy initiative for renewable projects in Puerto Rico (inclusive of a 100-megawatt solar facility with batteries), exemplify the commitment to sustainable urban energy solutions.

Global Demand for Decarbonization and Sustainable Energy

Global emphasis on climate change mitigation and sustainable energy intensifies demand for renewable infrastructure in Latin America. As per the United Nations Climate Summit, Latin America is expected to see a 460% increase in utility-scale wind and solar capacity by 2030. International agreements like the Paris Agreement drive the transition from fossil fuels, with global investors and development banks financing development activities. This financing bolsters new infrastructure projects vital to the region's contribution to carbon neutrality.

Market Segmentation

Energy Source Insights:

• Solar Energy Infrastructure: Infrastructure supporting solar power generation.
• Wind Energy Infrastructure: Infrastructure supporting power generation through wind turbines.
• Hydropower Infrastructure: Infrastructure related to hydroelectric dam operations and maintenance.
• Biomass & Waste-to-Energy: Infrastructure facilitating energy generation from biomass and waste materials.
• Geothermal Energy Infrastructure: Infrastructure for harnessing geothermal energy sources.

Component Insights:

• Power Generation Equipment: Includes solar panels, wind turbines, and hydroelectric dams for electricity generation.
• Grid Infrastructure: Systems and equipment facilitating power distribution and grid management.
• Energy Storage Systems: Includes battery storage and pumped hydro storage for managing electricity supply.
• Smart Grid & Digital Solutions: Technologies enhancing grid efficiency and digital management of energy systems.

Application Insights:

• Utility-Scale Renewable Projects: Large-scale renewable energy projects connected to the grid.
• Commercial & Industrial Installations: Renewable energy solutions implemented in commercial and industrial premises.
• Residential Renewable Energy Solutions: Renewable energy setups designed for homes and residential buildings.

Country Insights:

• Brazil
• Mexico
• Argentina
• Colombia
• Chile
• Peru
• Others

Regional Insights

Brazil is a dominant country market within Latin America, reflected by significant renewable energy infrastructure investments like the Vale-GIP transaction consolidating solar and hydro assets. The region benefits from abundant renewable resources and supportive government policies, suggesting sustained robust market growth with a CAGR of 10.80% forecasted across Latin America during 2025-2033.

Recent Developments & News

In October 2024, the International Union for Conservation of Nature (IUCN) partnered with REDEIA to advance environment-friendly energy infrastructure in Latin America and Spain, supporting biodiversity conservation efforts. In August 2024, Scala Data Centers formed the largest renewable energy alliance with Serena to supply wind power to hyperscale data centers, reflecting growing corporate commitments to sustainable energy in Latin America.

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Key Players

• Vale
• GIP
• REDEIA
• Scala Data Centers
• Serena

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