Rural Women in Peru Seed Water Today to Harvest It Tomorrow

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Water & Sanitation

Women and men from the rural community of Sachac, at more than 3500 meters above sea level, build a kilometer-long infiltration ditch to capture rainwater and use it to irrigate crops in Cuzco, in Peru’s Andes highlands. CREDIT: Janet Nina/IPS

Women and men from the rural community of Sachac, at more than 3500 meters above sea level, build a kilometer-long infiltration ditch to capture rainwater and use it to irrigate crops in Cuzco, in Peru’s Andes highlands. CREDIT: Janet Nina/IPS

CUZCO, Peru , Dec 22 2021 (IPS) – “When I was a little girl we didn’t suffer from water shortages like we do now. Today we are experiencing more droughts, our water sources are drying up and we cannot sit idly by,” Kely Quispe, a small farmer from the community of Huasao, located half an hour from Cuzco, the capital of Peru’s ancient Inca empire, told IPS.

She is one of the 80 members of the Agroecological School of the Flora Tristan Peruvian Women’s Center, a non-governmental institution that has worked for the recovery of water sources through traditional techniques known as seeding and harvesting water in this part of the southern Andean region of Cuzco.

Muñapata, Huasao and Sachac are the three rural Quechua-speaking communities in the province of Quispicanchi, located between 3150 and 3800 meters above sea level, that have so far benefited from the project. The feminist-oriented institution promotes solutions based on nature and community work to address the problem of water scarcity and inadequate water use practices.

“We want to boost water security as well as gender equality because they are two sides of the same coin,” Elena Villanueva told IPS. On Dec. 14 she presented in this city the results of the initiative whose first phase was carried out in 2020 and 2021, with the support of the Basque Development Cooperation Agency and Mugen Gainetik, an international association for cooperation with countries of the developing South also based in Spain’s northern Basque region.

According to the National Water Authority (ANA), Peru is the eighth country in the world in terms of water availability, with a rich hydrodiversity of glaciers, rivers, lakes, lagoons and aquifers. However, various factors such as inefficient management of water and uneven territorial distribution of the population, in addition to climate change, make it impossible to meet consumption demands.

“The lack of water severely affects families in rural areas because they depend on small-scale agriculture for their livelihoods. The melting of glaciers as well as the increase in the frequency and intensity of droughts due to climate change are reducing water availability,” Villanueva explained.

This impact, she said, is not neutral. Because of the gender discrimination and social disadvantages they face, it is rural women who bear the brunt, as their already heavy workload is increased, their health is undermined, and their participation in training and decision-making spaces is further limited.

Kely Quispe, a farmer trained at the Flora Tristán Center's Agroecological School, holds a tomato in her organic garden in the farming community of Huasao. Her vegetable production depends on access to water for irrigation, but climate change has made water more scarce in the Andes highlands region of Cuzco in southern Peru. CREDIT: Janet Nina/IPS

Kely Quispe, a farmer trained at the Flora Tristán Center’s Agroecological School, holds a tomato in her organic garden in the farming community of Huasao. Her vegetable production depends on access to water for irrigation, but climate change has made water more scarce in the Andes highlands region of Cuzco in southern Peru. CREDIT: Janet Nina/IPS

“Moreover, although they are the ones who use water to ensure food, hygiene and health, and to irrigate their crops, they are not part of the decision-making with regard to its management and distribution,” she stressed.

The expert said that precisely in response to demand by the women farmers at the Agroecological School, where they receive technical and rights training, they are focusing on reviving water harvesting techniques used in ancient Peru, while promoting the equal participation of women in rural communities in the process.

She said that approximately 700 families living in poverty, some 3,500 people – about 11 percent of the population of the three communities – will benefit from the works being carried out.

Harvesting water

So far, these works are focused on the afforestation of 15 hectares and the construction of six “cochas” – the name for small earthen ponds, in the Quechua language – and an infiltration ditch, as part of a plan that will be expanded with other initiatives over the next two years.

The ditch, which is one kilometer long in 10-meter stretches, 60 centimeters deep and 40 centimeters wide and is located in the upper part of the community, collects rainwater instead of letting it run down the slopes.

The technique allows water to infiltrate slowly in order to feed natural springs, high altitude wetlands or small native prairies, as well as the cochas.

The mayor of the rural community of Sachac, Eugenio Turpo Quispe (right), poses with other leaders of the village of 200 families who will benefit from the forestation works and the construction of small reservoirs and infiltration ditches that will increase the flow of water in this highlands area that is suffering from prolonged droughts due to climate change. CREDIT: Mariela Jara/IPS

The mayor of the rural community of Sachac, Eugenio Turpo Quispe (right), poses with other leaders of the village of 200 families who will benefit from the forestation works and the construction of small reservoirs and infiltration ditches that will increase the flow of water in this highlands area that is suffering from prolonged droughts due to climate change. CREDIT: Mariela Jara/IPS

In their communal work, villagers use local materials and greenhouse thermal blankets to help retain water. In addition, they have used extracted soil to raise the height of the ditch, to keep rainwater from running over the top.

Although the ditch has been receiving rainwater this month (the rainy season begins in November-December), the ecosystem impact is expected to be more visible in about three years when the cocha ponds have year-round water availability, helping villagers avoid the shortages of the May-October dry season.

Several community members explained to IPS that they will now be able to harvest water from the ditch while at the same time caring for the soil, because heavy rain washes it away and leaves it without nutrients. Some 150 agricultural plots will also benefit from a sprinkler irrigation system, thanks to the project.

Since agriculture is the main livelihood of the families and this activity depends on rainwater, the main impact will be the availability of water during the increasingly prolonged dry periods to irrigate their crops, ensure harvests and avoid hunger, for both villagers and their livestock.

Eucalyptus and pine, huge consumers of water

The mayor of the Sachac community, Eugenio Turpo Quispe, told IPS that this is the first time that water seeding and harvesting practices have been carried out in his area. “We had not had the opportunity before; these works have begun thanks to the women who proposed forestation and the construction of cochas and ditches,” he said.

The local leader lamented that due to misinformation, two decades ago they planted pine and eucalyptus in the highlands of his community. “They have dried up our water sources, and when it rains the water disappears, it does not infiltrate. Now we know that out of ten liters of rain that falls on the ground, eight are absorbed by the eucalyptus and only two return to the earth,” he explained during the day that IPS spent in the community.

Women farmers from the rural community of Sachac show the map of water sources in their area and the uses for irrigation of their crops, for human consumption and household needs, as well as watering their animals, which they cannot satisfy throughout the year due to the increasingly long and severe dry season. CREDIT: Mariela Jara/IPS

Women farmers from the rural community of Sachac show the map of water sources in their area and the uses for irrigation of their crops, for human consumption and household needs, as well as watering their animals, which they cannot satisfy throughout the year due to the increasingly long and severe dry season. CREDIT: Mariela Jara/IPS

Turpo Quispe said they had seen forestation and construction of cochas and ditches in other communities, but did not know how to replicate them, and that only through the Flora Tristán Center’s project have they been able to implement these solutions to tackle the serious problem of shrinking water sources.

In Sachac, the three techniques have been adopted with the participation of women and men in communal work that began at six in the morning and ended at four in the afternoon. “Side by side we have been planting native plants, digging ditches and hauling stones for the cochas,” the mayor said proudly.

In this community, 9,000 seedlings of queuñas (Polylepis) and chachacomos (Escallonia Resinosas) – tree species that were used in the times of the ancient Inca empire – were planted. “These trees consume only two liters of rainwater and give eight back to Pachamama (Mother Earth),” Turpo Quispe said. As part of the project, the community has built fences to protect crops and has relocated grazing areas for their animals.

“We have planted seedlings and in 10 or 15 years our children and grandchildren will see all our hills green and with living springs so that they do not suffer a lack of water,” the mayor said.

Kely Quispe from the community of Huasao is equally upbeat: “With water we can irrigate our potatoes, corn and vegetables; increase our production to have enough to sell and have extra money; take care of our health and that of the whole family, and prevent the spread of covid.”

“But just as we use water for life, it is also up to us to participate on an equal footing with men in irrigation committees and community councils to decide how it is distributed, conserved and managed,” she added.

A model shows the water sources in the rural community of Muñapata in the Cuzco region, in Peru’s southern highlands. It was made by local women and men who built a system based on ancestral techniques for the collection and management of water, as increasing drought threatens their lives and crops. CREDIT: Mariela Jara/IPS

A model shows the water sources in the rural community of Muñapata in the Cuzco region, in Peru’s southern highlands. It was made by local women and men who built a system based on ancestral techniques for the collection and management of water, as increasing drought threatens their lives and crops. CREDIT: Mariela Jara/IPS

The decade of water security

Villanueva of the Flora Tristán Center said it was important for the country’s local and regional authorities to commit to guaranteeing water security in rural areas within the framework of the Sustainable Development Goals (SDGs).

The International Decade for Action: Water for Sustainable Development was declared for 2018-2028 by the United Nations and SDG6 is dedicated to water and sanitation, to ensure universal and equitable access for all, protect and restore water-related ecosystems, and support the participation of local communities in improving management and sanitation.

“At the national level, public policies aimed at seeding and harvesting water should be strengthened because they revive the communities’ ancestral knowledge, involving sustainable practices with low environmental impact that contribute to guaranteeing the food security of families,” she said.

However, Villanueva remarked, in order to achieve their objectives, these measures must not only promote equal participation of men and women, but must also be accompanied by actions to close the gender gap in education, access to resources, training and violence that hinder the participation and development of rural women.

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Argentina’s Small Farming Communities Reach Consumers Online

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Food and Agriculture

This article is part of IPS’ coverage of World Food Day, celebrated Oct. 16, whose 2021 theme is: Grow, nourish, sustain. Together.

One of the Argentine small farmer groups participating in the digital marketing project uses agroecological irrigation and tomato crushing techniques in the province of Mendoza. CREDIT: Nicolás Heredia/Alma Nativa

One of the Argentine small farmer groups participating in the digital marketing project uses agroecological irrigation and tomato crushing techniques in the province of Mendoza. CREDIT: Nicolás Heredia/Alma Nativa

BUENOS AIRES, Oct 14 2021 (IPS) – “The biggest problem for family farmers has always been to market and sell what they produce, at a fair price,” says Natalia Manini, a member of the Union of Landless Rural Workers (UST), a small farmers organisation in Argentina that has been taking steps to forge direct ties with consumers.

The UST, which groups producers of fresh vegetables, preserves and honey, as well as goat and sheep breeders, from the western province of Mendoza, opened its own premises in April in the provincial capital of the same name.

In addition, it has just joined Alma Nativa (“native soul”), a network created to market and sell products from peasant and indigenous organisations, which brings together more than 4,300 producers grouped in 21 organisations, and now sells its products over the Internet.

“Selling wholesale to a distributor is simple, but the problem is that a large part of the income does not reach the producer,” Manini told IPS from the town of Lavalle in Mendoza province.

“The aim is to mobilise consumers to buy products from Latin American ecosystems that are made with respect for the environment, while small producers benefit from visibility and logistical support so that local products reach the entire country.” — Guadalupe Marín

The rural leader argues that, due to cost considerations, farmers can only access fair trade through collective projects, which have received a boost from the acceleration of digital changes generated by the covid-19 pandemic.

Alma Nativa is a marketing and sales solution formally created in 2018 by two Argentine non-governmental organisations (NGOs) focused on socio-environmental issues: Fibo Social Impact and the Cultural Association for Integral Development (ACDI). Their approach was to go a step beyond the scheme of economic support for productive development projects.

“Back in 2014 we began to ask ourselves why small farmer and indigenous communities could not secure profitable prices for the food and handicrafts they produce, and to think about how to get farmers to stop depending on donations and subsidies from NGOs and the state,” Fibo director Gabriela Sbarra told IPS in an interview in Buenos Aires.

Sbarra was a regular participant in regional community product fairs, which prior to the restrictions put in place due to the pandemic were often organised in Argentina by the authorities, who financed the setting up of the stands, accommodation and travel costs from their communities for farmers and craftspeople.

It was only thanks to this economic aid that farmers and artisans were able to make a profit.

“The effort was geared towards finding a genuine market for these products, which could not be sold online because it is very difficult to generate traffic on the Internet and they cannot reach supermarkets either, because they have no production volume. Informality was leaving communities out of the market,” Sbarra explained.

Three cooperatives in the Chaco region, the great forested plain that Argentina shares with Bolivia and Paraguay, are dedicated to honey production and are part of the Alma Nativa project, through which they sell their products to consumers throughout the country via the Internet. CREDIT: Nicolás Heredia/Alma Nativa

Three cooperatives in the Chaco region, the great forested plain that Argentina shares with Bolivia and Paraguay, are dedicated to honey production and are part of the Alma Nativa project, through which they sell their products to consumers throughout the country via the Internet. CREDIT: Nicolás Heredia/Alma Nativa

E-commerce, the new market

So the founders of Alma Nativa knocked on the doors of Mercado Libre, an e-commerce giant born in Argentina that has expanded throughout most of Latin America. The company agreed not to charge commissions for sales by an online store of agroecological food produced by local communities.

Alma Nativa then set up a warehouse in the town of Villa Madero, on the outskirts of Buenos Aires, where products arriving from rural communities throughout the country are labeled for distribution.

“The pandemic has created an opportunity, because it helped to open a debate about what we eat. Many people began to question how food is produced and even forced agribusiness companies to think about more sustainable production systems,” said Manini.

Norberto Gugliotta, manager of the Cosar Beekeeping Cooperative, emphasised that the pandemic not only accelerated the process of digitalisation of producers and consumers, but also fueled the search by a growing part of society for healthy food produced in a socially responsible manner.

“We were prepared to seize the opportunity, because our products were ready, so we joined Alma Nativa this year,” said the beekeeper from the town of Sauce Viejo. Gugliotta is the visible face of a cooperative made up of some 120 producers in the province of Santa Fe, in the centre of this South American country, who produce certified organic, fair trade honey.

Argentina, Latin America’s third largest economy, is an agricultural powerhouse, with a powerful agribusiness sector whose main products are soybeans, corn and soybean oil, which in 2020 generated 26.3 billion dollars in exports, according to official figures.

Behind the success lies a huge universe of family farmers and peasant and indigenous communities. According to the latest National Agricultural Census, carried out in 2018, more than 90 percent of the country’s 250,881 farms are family-run.

But the infrastructure and technological lag in rural areas is significant, as demonstrated by the fact that only 35 percent of farms have Internet access.

The deprivation is particularly acute in the Chaco, a neglected region in the north of the country, home to some 200,000 indigenous people belonging to nine groups whose economy is closely linked to natural resources, according to the non-governmental Fundapaz.

Indigenous artisans from the Pilagá community in the northern province of Formosa, within the Gran Chaco region, have begun selling their baskets online throughout Argentina. CREDIT: Rosario Bobbio/Alma Nativa

Indigenous artisans from the Pilagá community in the northern province of Formosa, within the Gran Chaco region, have begun selling their baskets online throughout Argentina. CREDIT: Rosario Bobbio/Alma Nativa

New platform for indigenous handicrafts

Communities from the Chaco, a vast region of low forests and savannas and rich biodiversity covering more than one million square km in Argentina, Bolivia and Paraguay, which is home to a diversity of native peoples, also began to market their handicrafts over Mercado Libre in the last few weeks.

“This initiative originated in Brazil with the ‘Amazonia em Pé’ programme and today we are replicating it in Argentina, in the Gran Chaco area. It seeks to build bridges between local artisans and consumers throughout the country,” explained Guadalupe Marín, director of sustainability at Mercado Libre.

“The aim is to mobilise consumers to buy products from Latin American ecosystems that are made with respect for the environment, while small producers benefit from visibility and logistical support so that local products reach the entire country,” she told IPS in Buenos Aires.

On Sept. 27, Mercado Libre launched the campaign “From the Gran Chaco, for you”, which offers for sale more than 2,500 products in 200 categories, such as baskets, indigenous and local art, decorative elements made with natural fibers, honey, weavings and handmade games.

It includes not only Alma Nativa, but also Emprendedores por Naturaleza (“entrepreneurs by/for nature”), a programme launched by the environmental foundation Rewilding Argentina, which works for the conservation of the Chaco and now promotes the sale of products made by 60 families living in rural areas adjacent to the El Impenetrable national park, the largest protected area in the region.

“The idea for the project arose last year, after we conducted a socioeconomic survey among 250 families in the area that found that the only income of 98 percent of them comes from welfare,” said Fatima Hollmann, regional coordinator of the Rewilding Argentina Communities Programme.

She told IPS that “people raise livestock for subsistence and sometimes work on fencing a field or some other temporary task, but there are no steady sources of employment in El Impenetrable.”

“That is why we are trying to generate income for local residents,” Hollmann explained in an interview in Buenos Aires. “Our production lines are focused on ceramics, since most people have built their houses there with adobe. Many also know how to make bricks and we have held trainings to teach people to turn a brick into an artistic piece, inspired by native fauna, which transmits the importance of conserving the forest.”

According to the figures released by the expert during the first week of the programme “From the Gran Chaco, for you” in early October, 644 products were offered for sale, of which 382 were sold to buyers from more than 10 Argentine provinces, including 100 percent of the textiles available and 76 percent of the wooden handicrafts.

“The alternative is to cut down the native forests,” Hollmann says. “We are proposing a transition from an extractivist economy to a regenerative one, which contributes to the reconstruction of the ecosystem, and gives consumers in the cities the chance to contribute to that goal.”

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Recipes with a Taste of Sustainable Development on the Coast of El Salvador

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Environment

María Luz Rodríguez stands next to her solar oven where she cooked lasagna in the village of El Salamar in San Luis La Herradura municipality. In this region in southern El Salvador, an effort is being made to implement environmental actions to ensure the sustainable use of natural resources. CREDIT: Edgardo Ayala/ IPS

María Luz Rodríguez stands next to her solar oven where she cooked lasagna in the village of El Salamar in San Luis La Herradura municipality. In this region in southern El Salvador, an effort is being made to implement environmental actions to ensure the sustainable use of natural resources. CREDIT: Edgardo Ayala/ IPS

SAN LUIS LA HERRADURA, El Salvador, Mar 31 2021 (IPS) – Salvadoran villager Maria Luz Rodriguez placed the cheese on top of the lasagna she was cooking outdoors, put the pan in her solar oven and glanced at the midday sun to be sure there was enough energy for cooking.

“Hopefully it won’t get too cloudy later,” Maria Luz, 78, told IPS. She then checked the thermometer inside the oven to see if it had reached 150 degrees Celsius, the ideal temperature to start baking.

She lives in El Salamar, a coastal village of 95 families located in San Luis La Herradura, a municipality in the central department of La Paz which is home to some 30,000 people on the edge of an impressive ecosystem: the mangroves and bodies of water that make up the Estero de Jaltepeque, a natural reserve whose watershed covers 934 square kilometres.

After several minutes the cheese began to melt, a clear sign that things were going well inside the solar oven, which is simply a box with a lid that functions as a mirror, directing sunlight into the interior, which is covered with metal sheets.

“I like to cook lasagna on special occasions,” Maria Luz said with a smile.

After Tropical Storm Stan hit Central America in 2005, a small emergency fund reached El Salamar two years later, which eventually became the start of a much more ambitious sustainable development project that ended up including more than 600 families.

Solar ovens and energy-efficient cookstoves emerged as an important component of the programme.

Aerial view of Estero de Jaltepeque, in San Luis La Herradura, a municipality on the Pacific coast in southern El Salvador where a sustainable development programme is being carried out in local communities, including the use of solar stoves and sustainable fishing and agriculture techniques. CREDIT: Edgardo Ayala /IPS

Aerial view of Estero de Jaltepeque, in San Luis La Herradura, a municipality on the Pacific coast in southern El Salvador where a sustainable development programme is being carried out in local communities, including the use of solar stoves and sustainable fishing and agriculture techniques. CREDIT: Edgardo Ayala /IPS

The project was financed by the Global Environment Facility‘s (GEF) Small Grants Programme, and El Salamar was later joined by other villages, bringing the total number to 18. The overall investment was more than 400,000 dollars.

In addition to solar ovens and high-energy rocket stoves, work was done on mangrove reforestation and sustainable management of fishing and agriculture, among other measures. Agriculture and fishing are the main activities in these villages, in addition to seasonal work during the sugarcane harvest.

While María Luz made the lasagna, her daughter, María del Carmen Rodríguez, 49, was cooking two other dishes: bean soup with vegetables and beef, and rice – not in a solar oven but on one of the rocket stoves.

This stove is a circular structure 25 centimetres high and about 30 centimetres in diameter, whose base has an opening in which a small metal grill is inserted to hold twigs no more than 15 centimetres long, which come from the gliridicia (Gliricidia sepium) tree. This promotes the use of living fences that provide firewood, to avoid damaging the mangroves.

The stove maintains a good flame with very little wood, due to its high energy efficiency, unlike traditional cookstoves, which require several logs to prepare each meal and produce smoke that is harmful to health.

María del Carmen Rodríguez cooks rice on a rocket stove using a few twigs from a tree species that emits less CO2 than mangroves, whose sustainability is also preserved thanks to the use of the tree. Many families in the community of El Salamar have benefited from this energy-efficient technology, as well as other initiatives promoted along the Pacific coast in southern El Salvador. CREDIT: Edgardo Ayala /IPS

María del Carmen Rodríguez cooks rice on a rocket stove using a few twigs from a tree species that emits less CO2 than mangroves, whose sustainability is also preserved thanks to the use of the tree. Many families in the community of El Salamar have benefited from this energy-efficient technology, as well as other initiatives promoted along the Pacific coast in southern El Salvador. CREDIT: Edgardo Ayala /IPS

The rocket stove can cook anything, but it is designed to work with another complementary mechanism for maximum energy efficiency.

Once the stews or soups have reached boiling point, they are placed inside the “magic” stove: a circular box about 36 centimetres in diameter made of polystyrene or durapax, as it is known locally, a material that retains heat.

The food is left there, covered, to finish cooking with the steam from the hot pot, like a kind of steamer.

“The nice thing about this is that you can do other things while the soup is cooking by itself in the magic stove,” explained María del Carmen, a homemaker who has five children.

The technology for both stoves was brought to these coastal villages by a team of Chileans financed by the Chile Fund against Hunger and Poverty, established in 2006 by the government of that South American country and the United Nations Development Programme (UNDP) to promote South-South cooperation.

The Chileans taught a group of young people from several of these communities how to make the components of the rocket stoves, which are made from clay, cement and a commercial sealant or glue.

The blue crab is one of the species raised in nurseries by people in the Estero de Jaltepeque region in southern El Salvador, as part of an environmental sustainability project in the area financed by the Global Environment Facility’s Small Grants Programme. CREDIT: Edgardo Ayala/IPS

The blue crab is one of the species raised in nurseries by people in the Estero de Jaltepeque region in southern El Salvador, as part of an environmental sustainability project in the area financed by the Global Environment Facility’s Small Grants Programme. CREDIT: Edgardo Ayala/IPS

The use of these stoves “has reduced carbon dioxide (CO2) emissions by at least 50 percent compared to traditional stoves,” Juan René Guzmán, coordinator of the GEF’s Small Grants Programme in El Salvador, told IPS.

Some 150 families use rocket stoves and magic stoves in 10 of the villages that were part of the project, which ended in 2017.

“People were given their cooking kits, and in return they had to help plant mangroves, or collect plastic, not burn garbage, etc. But not everyone was willing to work for the environment,” Claudia Trinidad, 26, a native of El Salamar and a senior studying business administration – online due to the COVID pandemic – at the Lutheran University of El Salvador, told IPS.

Those who worked on the mangrove reforestation generated hours of labour, which were counted as more than 800,000 dollars in matching funds provided by the communities.

In the project area, 500 hectares of mangroves have been preserved or restored, and sustainable practices have been implemented on 300 hectares of marine and land ecosystems.

Petrona Cañénguez shows how she cooks bean soup on an energy-efficient rocket stove in an outside room of her home in the hamlet of San Sebastián El Chingo, one of the beneficiaries of a sustainable development programme in the municipality of San Luis La Herradura, on El Salvador's southern coast. CREDIT: Edgardo Ayala /IPS

Petrona Cañénguez shows how she cooks bean soup on an energy-efficient rocket stove in an outside room of her home in the hamlet of San Sebastián El Chingo, one of the beneficiaries of a sustainable development programme in the municipality of San Luis La Herradura, on El Salvador’s southern coast. CREDIT: Edgardo Ayala /IPS

Petrona Cañénguez, from the town of San Sebastián El Chingo, was among the people who participated in the work. She was also cooking bean soup for lunch on her rocket stove when IPS visited her home during a tour of the area.

“I like the stove because you feel less heat when you are preparing food, plus it’s very economical, just a few twigs and that’s it,” said Petrona, 59.

The bean soup, a staple dish in El Salvador, would be ready in an hour, she said. She used just under one kilo of beans, and the soup would feed her and her four children for about five days.

However, she used only the rocket stove, without the magic stove, more out of habit than anything else. “We always have gliridicia twigs on hand,” she said, which make it easy to use the stove.

Although the solar oven offers the cleanest solution, few people still have theirs, IPS found.

This is due to the fact that the wood they were built with was not of the best quality and the coastal weather conditions and moths soon took their toll.

Maria Luz is one of the few people who still uses hers, not only to cook lasagna, but for a wide variety of recipes, such as orange bread.

However, the project is not only about stoves and ovens.

Some families living in coastal villages in the municipality of San Luis La Herradura have dug ponds for sustainable fishing, which was of great help to the local population during the COVID-19 lockdown in this coastal area of southern El Salvador. CREDIT: Edgardo Ayala /IPS

Some families living in coastal villages in the municipality of San Luis La Herradura have dug ponds for sustainable fishing, which was of great help to the local population during the COVID-19 lockdown in this coastal area of southern El Salvador. CREDIT: Edgardo Ayala /IPS

The beneficiary families also received cayucos (flat-bottomed boats smaller than canoes) and fishing nets, plus support for setting up nurseries for blue crabs and mollusks native to the area, as part of the fishing component with a focus on sustainability in this region on the shores of the Pacific Ocean.

Several families have dug ponds that fill up with water from the estuary at high tide, where they raise fish that provide them with food in times of scarcity, such as during the lockdown declared in the country in March 2020 to curb the spread of coronavirus.

The project also promoted the planting of corn and beans with native seeds, as well as other crops – tomatoes, cucumbers, cushaw squash and radishes – using organic fertiliser and herbicides.

The president of the Local Development Committee of San Luis La Herradura, Daniel Mercado, told IPS that during the COVID-19 health emergency people in the area resorted to bartering to stock up on the food they needed.

“If one community had tomatoes and another had fish, we traded, we learned to survive, to coexist,” Daniel said. “It was like the communism of the early Christians.”

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Energy Cooperatives Swim Against the Tide in Mexico

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Energy

Onergia, one of the two energy cooperatives operating in Mexico today, installs photovoltaic systems, such as this one at the Tosepan Titataniske Union of Cooperatives in the municipality of Cuetzalan, in the southern state of Puebla. CREDIT: Courtesy of Onergia

Onergia, one of the two energy cooperatives operating in Mexico today, installs photovoltaic systems, such as this one at the Tosepan Titataniske Union of Cooperatives in the municipality of Cuetzalan, in the southern state of Puebla. CREDIT: Courtesy of Onergia

MEXICO CITY, Aug 31 2020 (IPS) – A Mexican solar energy cooperative, Onergia, seeks to promote decent employment, apply technological knowledge and promote alternatives that are less polluting than fossil fuels, in one of the alternative initiatives with which Mexico is seeking to move towards an energy transition.

“We organised ourselves in a cooperative for an energy transition that will rethink the forms of production, distribution and consumption to build a healthier and fairer world,” Onergia founding partner and project director Antonio Castillo told IPS. “In this sector, it has been more difficult; we have to invest in training and go against the logic of the market.”

The eight-member cooperative, created in 2017, has so far installed some 50 photovoltaic systems, mainly in the south-central state of Puebla.

“A public policy is needed that would allow us to move towards the transition. Getting people to adopt alternatives depends on public policy. It is fundamental for people to have the freedom to choose how to consume. It is our job to organise as consumers.” —
Antonio Castillo

Castillo explained by phone that the cooperative works with middle- and upper-class households that can finance the cost of the installation as well as with local communities keen on reducing their energy bill, offering more services and expanding access to energy.

In the case of local communities, the provision of solar energy is part of broader social projects in which the beneficiary organisations’ savings and loan cooperatives design the financial structure to carry out the work. A basic household system can cost more than 2,200 dollars and a larger one, over 22,000.

“The communities are motivated to adopt renewable energy as a strategy to defend the land against threats from mining or hydroelectric companies,” said Castillo. “They don’t need to be large-scale energy generators, because they already have the local supply covered. The objective is to provide the communities with alternatives.”

Onergia, a non-profit organisation, promotes distributed or decentralised generation.

In Mexico, energy cooperatives are a rarity. In fact, there are only two, due to legal, technical and financial barriers, even though the laws governing cooperatives recognise their potential role in energy among other diverse sectors. The other, Cooperativa LF del Centro, provides services in several states but is not a generator of electricity.

The Electricity Industry Law, in effect since 2014, allows the deployment of local projects smaller than one megawatt, but practically excludes them from the electricity auctions that the government had been organising since 2016 and that the administration of leftwing President Andrés Manuel López Obrador put a stop to after he took office in December 2018.

Since then, López Obrador has opted to fortify the state monopolies of the Federal Electricity Commission (CFE) and the Petróleos Mexicanos (Pemex) oil giant, which translates into favouring fossil fuels over renewable sources.

The National Electric System Development Programme 2018-2032 projects that fossil fuels will represent 67 percent of the energy mix in 2022; wind energy, 10 percent; hydroelectric, nine percent; solar, four percent; nuclear, three percent, and geothermal and bioenergy, four percent.

In 2032, the energy outlook will not vary much, as fossil fuels will account for 60 percent; wind, nuclear and geothermal energy will rise to 13, eight and three percent, respectively; hydroelectric power will drop to eight percent; while solar and bioenergy will remain the same.

In Mexico, rural communities are guaranteeing their electricity supply by using clean sources, thus furthering the energy transition to micro and mini-scale generation. The photo shows the "Laatzi-Duu" ecotourism site (the name means "standing plain" in the Zapotec indigenous language) which is self-sufficient thanks to a solar panel installed on its roof, in the municipality of San Juan Evangelista Analco in the southern state of Oaxaca. CREDIT: Emilio Godoy/IPS

In Mexico, rural communities are guaranteeing their electricity supply by using clean sources, thus furthering the energy transition to micro and mini-scale generation. The photo shows the “Laatzi-Duu” ecotourism site (the name means “standing plain” in the Zapotec indigenous language) which is self-sufficient thanks to a solar panel installed on its roof, in the municipality of San Juan Evangelista Analco in the southern state of Oaxaca. CREDIT: Emilio Godoy/IPS

The government cancelled the call for long-term electric auctions that allowed private companies to build wind and solar plants and sell the energy to CFE. But these tenders privileged private Mexican and foreign capital and large-scale generation.

In a dialogue with IPS, independent researcher Carlos Tornel questioned the predominant energy design promoted by the 2013 reform that opened up the hydrocarbon and electricity markets to private capital, and the form of energy production based on passive consumers.

“We don’t have an effective legal framework to promote that kind of energy transition,” said the expert via WhatsApp from the northeast English city of Durham. “A free market model was pursued, which allowed the entry of megaprojects through auctions and allowed access to those who could offer a very low cost of generation, which could only be obtained on a large scale.”

With that strategy, he added, “small projects were left out. And the government did not put in place economic incentives to foment cooperative schemes.”

“We need a more active model focused on the collective good,” added Tornel, who is earning a PhD in Human Geography at Durham University in the UK.

Mexico, the second largest economy in Latin America with a population of 129 million, depends heavily on hydrocarbons and will continue to do so in the medium term if it does not accelerate the energy transition.

In the first quarter of 2019, gross generation totaled 80,225 gigawatt hours (Gwh), up from 78,167 in the same period last year. Gas-fired combined cycle plants (with two consecutive cycles, conventional turbine and steam) contributed 40,094, conventional thermoelectric 9,306, and coal-fired 6,265.

Hydroelectric power plants contributed 5,137 Gwh; wind fields 4,285; nuclear power plants 2,382; and solar stations 1,037.

The Energy Transition Law of 2015 stipulates that clean energy must meet 30 percent of demand by 2021 and 35 percent by 2024. By including hydropower and nuclear energy, the country will have no problem reaching these goals.

Residents of the small rural community of Amatlán, in the municipality of Zoquiapan in the state of Puebla, oversee the operation of photovoltaic panels installed by the Mexican cooperative Onergia. This type of cooperative can help rural communities in Mexico access clean energy, particularly solar power. CREDIT: Courtesy of Onergia

Residents of the small rural community of Amatlán, in the municipality of Zoquiapan in the state of Puebla, oversee the operation of photovoltaic panels installed by the Mexican cooperative Onergia. This type of cooperative can help rural communities in Mexico access clean energy, particularly solar power. CREDIT: Courtesy of Onergia

By early August, the government’s Energy Regulatory Commission (CRE) had granted 310 permits for solar generation, small-scale production and self-supply, totaling almost 22,000 Mw.

The 2017 report Renewable Energy Auctions and Participatory Citizen Projects, produced by the international non-governmental Renewable Energy Policy Network for the 21st Century (REN21), cites, with respect to Mexico, the obligation for investors to form self-sufficient companies, which complicates attempts to develop local ventures.

Onergia’s Castillo stressed the need for a clear and stable regulatory framework.

“A public policy is needed that would allow us to move towards the transition,” he said. “Getting people to adopt alternatives depends on public policy. It is fundamental for people to have the freedom to choose how to consume. It is our job to organise as consumers.”

Affected by the coronavirus pandemic, Onergia is reviewing the way it works and its financial needs to generate its own power supply. It also works with the Renewable Energies Institute of the National Autonomous University of Mexico in the design and installation of solar power systems.

In March, the government’s National Council for Science and Technology launched a strategic national programme on energy transition that will promote sustainable rural energy projects and community solar energy, to be implemented starting in 2021.

In addition, the energy ministry is set to announce the Special Energy Transition Programme 2019-2024.

But to protect the CFE, the CRE is blocking approval of the development of collective distributed generation schemes, which would allow citizens to sell surplus energy to other consumers, and the installation of storage systems in solar parks.

Tornel criticised the lack of real promotion of renewable sources.

“The Mexican government has been inconsistent in its handling of this issue,” he maintained. “They talk about guaranteeing energy security through hydrocarbons. There is no plan for an energy transition based on renewables or on supporting community projects. We have no indication that they support renewable, and that’s very worrying.”

The REN21 report recommends reserving a quota for participatory citizen projects and facilitating access to energy purchase agreements, which ensures the efficiency of tenders and the effectiveness of guaranteed tariffs for these undertakings.

In addition, it proposes the establishment of an authority for citizen projects, capacity building, promotion of community energy and specific national energy targets for these initiatives.

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Semiarid Regions of Latin America Cooperate to Adapt to Climate

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Civil Society, Combating Desertification and Drought, Development & Aid, Economy & Trade, Editors’ Choice, Environment, Featured, Food & Agriculture, Green Economy, Headlines, Integration and Development Brazilian-style, Latin America & the Caribbean, Projects, Regional Categories, South-South, TerraViva United Nations, Water & Sanitation

Combating Desertification and Drought

A rural settlement in the state of Pernambuco, in Brazil's semiarid ecoregion. Tanks that collect rainwater from rooftops for drinking water and household usage have changed life in this parched land, where 1.1 million 16,000-litre tanks have been installed so far. CREDIT: Mario Osava/IPS

A rural settlement in the state of Pernambuco, in Brazil’s semiarid ecoregion. Tanks that collect rainwater from rooftops for drinking water and household usage have changed life in this parched land, where 1.1 million 16,000-litre tanks have been installed so far. CREDIT: Mario Osava/IPS

RIO DE JANEIRO, Aug 27 2020 (IPS) – After centuries of poverty, marginalisation from national development policies and a lack of support for positive local practices and projects, the semiarid regions of Latin America are preparing to forge their own agricultural paths by sharing knowledge, in a new and unprecedented initiative.

In Brazil’s semiarid Northeast, the Gran Chaco Americano, which is shared by Argentina, Bolivia and Paraguay, and the Central American Dry Corridor (CADC), successful local practices will be identified, evaluated and documented to support the design of policies that promote climate change-resilient agriculture in the three ecoregions.

This is the objective of DAKI-Semiárido Vivo, an initiative financed by the United Nations International Fund for Agricultural Development (IFAD) and implemented by the Brazilian Semiarid Articulation (ASA), the Argentinean Foundation for Development in Justice and Peace (Fundapaz) and the National Development Foundation (Funde) of El Salvador.

DAKI stands for Dryland Adaptation Knowledge Initiative.

The project, launched on Aug. 18 in a special webinar where some of its creators were speakers, will last four years and involve 2,000 people, including public officials, rural extension agents, researchers and small farmers. Indirectly, 6,000 people will benefit from the training.

“The aim is to incorporate public officials from this field with the intention to influence the government’s actions,” said Antonio Barbosa, coordinator of DAKI-Semiárido Vivo and one of the leaders of the Brazilian organisation ASA.

The idea is to promote programmes that could benefit the three semiarid regions, which are home to at least 37 million people – more than the total populations of Chile, Ecuador and Peru combined.

The residents of semiarid regions, especially those who live in rural areas, face water scarcity aggravated by climate change, which affects their food security and quality of life.

Zulema Burneo, International Land Coalition coordinator for Latin America and the Caribbean and moderator of the webinar that launched the project, stressed that the initiative was aimed at “amplifying and strengthening” isolated efforts and a few longstanding collectives working on practices to improve life in semiarid areas.

Abel Manto, an inventor of technologies that he uses on his small farm in the state of Bahia, in Brazil's semiarid ecoregion, holds up a watermelon while standing among the bean crop he is growing on top of an underground dam. The soil is on a waterproof plastic tarp that keeps near the surface the water that is retained by an underground dam. CREDIT: Mario Osava/IPS

Abel Manto, an inventor of technologies that he uses on his small farm in the state of Bahia, in Brazil’s semiarid ecoregion, holds up a watermelon while standing among the bean crop he is growing on top of an underground dam. The soil is on a waterproof plastic tarp that keeps near the surface the water that is retained by an underground dam. CREDIT: Mario Osava/IPS

The practices that represent the best knowledge of living in the drylands will be selected not so much for their technical aspects, but for the results achieved in terms of economic, ecological and social development, Barbosa explained to IPS in a telephone interview from the northeastern Brazilian city of Recife, where the headquarters of ASA are located.

After the process of systematisation of the best practices in each region is completed, harnessing traditional knowledge through exchanges between technicians and farmers, the next step will be “to build a methodology and the pedagogical content to be used in the training,” he said.

One result will be a platform for distance learning. The Federal Rural University of Pernambuco, also in Recife, will help with this.

Decentralised family or community water supply infrastructure, developed and disseminated by ASA, a network of 3,000 social organisations scattered throughout the Brazilian Northeast, is a key experience in this process.

In the 1.03 million square kilometres of drylands where 22 million Brazilians live, 38 percent in rural areas according to the 2010 census, 1.1 million rainwater harvesting tanks have been built so far for human consumption.

An estimated 350,000 more are needed to bring water to the entire rural population in the semiarid Northeast, said Barbosa.

But the most important aspect for agricultural development involves eight “technologies” for obtaining and storing water for crops and livestock. ASA, created in 1999, has helped install this infrastructure on 205,000 farms for this purpose and estimates that another 800 peasant families still need it.

There are farms that are too small to install the infrastructure, or that have other limitations, said Barbosa, who coordinates ASA’s One Land and Two Waters and native seed programmes.

The “calçadão” technique, where water runs down a sloping concrete terrace or even a road into a tank that has a capacity to hold 52,000 litres, is the most widely used system for irrigating vegetables.

A group of peasant farmers from El Salvador stand in front of one of the two rainwater tanks built in their village, La Colmena, in the municipality of Candelaria de la Frontera. The pond is part of a climate change adaptation project in the Central American Dry Corridor. Central American farmers like these and others from Brazil's semiarid Northeast have exchanged experiences on solutions for living with lengthy droughts. CREDIT: Edgardo Ayala/IPS

A group of peasant farmers from El Salvador stand in front of one of the two rainwater tanks built in their village, La Colmena, in the municipality of Candelaria de la Frontera. The pond is part of a climate change adaptation project in the Central American Dry Corridor. Central American farmers like these and others from Brazil’s semiarid Northeast have exchanged experiences on solutions for living with lengthy droughts. CREDIT: Edgardo Ayala/IPS

And in Argentina’s Chaco region, 16,000-litre drinking water tanks are mushrooming.

But tanks for intensive and small farming irrigation are not suitable for the dry Chaco, where livestock is raised on large estates of hundreds of hectares, said Gabriel Seghezzo, executive director of Fundapaz, in an interview by phone with IPS from the city of Salta, capital of the province of the same name, one of those that make up Argentina’s Gran Chaco region.

“Here we need dams in the natural shallows and very deep wells; we have a serious water problem,” he said. “The groundwater is generally of poor quality, very salty or very deep.”

First, peasants and indigenous people face the problem of formalising ownership of their land, due to the lack of land titles. Then comes the challenge of access to water, both for household consumption and agricultural production.

“In some cases there is the possibility of diverting rivers. The Bermejo River overflows up to 60 km from its bed,” he said.

Currently there is an intense local drought, which seems to indicate a deterioration of the climate, urgently requiring adaptation and mitigation responses.

Reforestation and silvopastoral systems are good alternatives, in an area where deforestation is “the main conflict, due to the pressure of the advance of soy and corn monoculture and corporate cattle farming,” he said.

Mariano Barraza of the Wichí indigenous community (L) and Enzo Romero, a technician from the Fundapaz organisation, stand next to the tank built to store rainwater in an indigenous community in the province of Salta, in the Chaco ecoregion of northern Argentina, where there are six months of drought every year. CREDIT: Daniel Gutman/IPS

Mariano Barraza of the Wichí indigenous community (L) and Enzo Romero, a technician from the Fundapaz organisation, stand next to the tank built to store rainwater in an indigenous community in the province of Salta, in the Chaco ecoregion of northern Argentina, where there are six months of drought every year. CREDIT: Daniel Gutman/IPS

More forests would be beneficial for the water, reducing evaporation that is intense due to the heat and hot wind, he added.

Of the “technologies” developed in Brazil, one of the most useful for other semiarid regions is the “underground dam,” Claus Reiner, manager of IFAD programmes in Brazil, told IPS by phone from Brasilia.

The underground dam keeps the surrounding soil moist. It requires a certain amount of work to dig a long, deep trench along the drainage route of rainwater, where a plastic tarp is placed vertically, causing the water to pool during rainy periods. A location is chosen where the natural layer makes the dam impermeable from below.

This principle is important for the Central American Dry Corridor, where “the great challenge is how to infiltrate rainwater into the soil, in addition to collecting it for irrigation and human consumption,” said Ismael Merlos of El Salvador, founder of Funde and director of its Territorial Development Area.

The CADC, which cuts north to south through Guatemala, Honduras and El Salvador, is defined not as semiarid, but as a sub-humid region, because it rains slightly more there, although in an increasingly irregular manner.

Some solutions are not viable because “75 percent of the farming areas in the Corridor are sloping land, unprotected by organic material, which makes the water run off more quickly into the rivers,” Merlos told IPS by phone from San Salvador.

“In addition, the large irrigation systems that we’re familiar with are not accessible for the poor because of their high cost and the expensive energy for the extraction and pumping of water, from declining sources,” he said.

The most viable alternative, he added, is making better use of rainwater, by building tanks, or through techniques to retain moisture in the soil, such as reforestation and leaving straw and other harvest waste on the ground rather than burning it as peasant farmers continue to do.

“Harmful weather events, which four decades ago occurred one to three times a year, now happen 10 or more times a year, and their effects are more severe in the Dry Zone,” Merlos pointed out.

Funde is a Salvadoran centre for development research and policy formulation that together with Fundapaz, four Brazilian organisations forming part of the ASA network and seven other Latin American groups had been cooperating since 2013, when they created the Latin American Semiarid Platform.

The Platform paved the way for the DAKI-Semiárido Vivo which, using 78 percent of its two million dollar budget, opened up new horizons for synergy among Latin America’s semiarid ecoregions. To this end, said Burneo, it should create a virtuous alliance of “good practices and public policies.”

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Crisis Hits Oil Industry and Energy Transition Alike

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Energy

Mexico's state-run oil giant Pemex faces a difficult outlook due to the fall in international oil prices and the crisis resulting from the coronavirus pandemic, which threatens its production and finances, in a situation analysed during the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. CREDIT: Emilio Godoy/IPS

Mexico’s state-run oil giant Pemex faces a difficult outlook due to the fall in international oil prices and the crisis resulting from the coronavirus pandemic, which threatens its production and finances, in a situation analysed during the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. CREDIT: Emilio Godoy/IPS

MEXICO CITY, May 22 2020 (IPS) – While it attempts to cushion the effects of the coronavirus pandemic, the Latin American and Caribbean region also faces concerns about the future of the energy transition and state-owned oil companies.

These questions were discussed at the 29th La Jolla Energy Conference, organised by the Institute of the Americas. It was held online May 18-22, rather than bringing together more than 50 speakers at the institute’s headquarters in the coastal district of San Diego, in the U.S. state of California, in the midst of the COVID-19 pandemic.

Alfonso Blanco of Uruguay, executive secretary of the Latin American Energy Organisation (OLADE), said during a session on global trends and the regional energy industry that the changes seen during the pandemic will spread after the crisis and will be long-lasting.

“There will be structural transformations and we are convinced that most consumer behaviors will change after the pandemic. Demand will vary due to changes in the main areas of transportation and other energy areas. The effects on fossil fuel consumption will be strong and there will be a greater impact on renewable energies,” he said.

OLADE, a 27-member regional intergovernmental organisation for energy coordination, estimates that electricity demand has fallen by 29 percent in Bolivia compared to 2019, as a result of the severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), which causes COVID-19, and by 26 percent in Argentina, 22 percent in Brazil and 11 percent in Chile.

“There will be structural transformations and we are convinced that most consumer behaviors will change after the pandemic. Demand will vary due to changes in the main areas of transportation and other energy areas. The effects on fossil fuel consumption will be strong and there will be a greater impact on renewable energies.” — Alfonso Blanco

Likewise, final energy demand plummeted 14 percent in Brazil compared to 2019, 11 percent in both the Andean and Southern Cone regions, nine percent in Mexico, seven percent in Central America and five percent in the Caribbean.

As countries went into lockdown to curb the spread of COVID-19, electricity consumption by businesses and factories declined, due to the suspension of activities.

Leonardo Sempertegui, legal advisor to the Organisation of Petroleum Exporting Countries (OPEC), said the pandemic may be a wake-up call for countries lagging behind in the energy transition.

“This may be the new normal. The structure and governance of the energy architecture to cope with the next phase are changing dramatically. Energy poverty and the energy transition cannot be solved regardless of who controls a resource; these challenges cannot wait,” he said in the same session.

In Latin America, nations like Argentina, Bolivia, the Dominican Republic, Ecuador, Honduras and Uruguay have made progress in the energy transition since 2015, while Brazil has slid backwards and countries like Mexico are stuck in the same place, according to the World Economic Forum’s Energy Transition Index, released May 13.

As the region heads into the fourth month of the pandemic, countries are assessing their electricity markets, which have been shaken by the crisis.

Nations like Argentina, Chile, Colombia and Peru have resorted to long-term electricity auctions, which have generated low prices for renewables, while Mexico suspended such schemes in 2019.

In Argentina, as Andrés Chambouleyron, a non-resident fellow at the Institute of the Americas, explained, industrial consumption fell by 50 percent and electricity distributors have not been able to obtain sufficient revenues to cover fixed costs or electricity purchases.

The government has thus provided financing to Cammesa – the electricity wholesale market administration company – to pay the generators, since it is bound by contracts to buy the energy.

“There will be a permanent change in electricity consumption in Argentina. We have cheaper gas than before; the models say that you have to use more gas because it is cheaper than other sources. We won’t see much change in Argentina’s energy mix, and that could extend to all of Latin America,” said Chambouleyron, who warned of breach of and renegotiation of contracts for energy purchases.

Low oil prices threaten to slow down the energy transition in Latin America, although renewable energies already compete with the costs of fossil fuels, agreed experts at the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. The photo shows solar panels on a house in Ajijic, in the western Mexican state of Jalisco. CREDIT: Emilio Godoy/IPS

Low oil prices threaten to slow down the energy transition in Latin America, although renewable energies already compete with the costs of fossil fuels, agreed experts at the 29th La Jolla Energy Conference, organised online by the Institute of the Americas. The photo shows solar panels on a house in Ajijic, in the western Mexican state of Jalisco. CREDIT: Emilio Godoy/IPS

While renewables are already competing in price with conventional sources, low oil and gas prices undermine their expansion, a predicament that alternative energy sources have been facing in recent years.

In addition, the rise in the cost of international credit and the fluctuations of the dollar against local currencies may make generation more expensive.

In another session on the outlook for state-owned oil companies, Marta Jara, former president of Uruguay’s public oil company ANCAP, said the current crisis could accelerate the transition, but called it a “major challenge”.

“The temptation is to be opportunistic and forget the roadmap of the energy transition. We must invest in sustainable energy systems, decarbonise transport. It is important to secure funding and create jobs. I hope the crisis opens the door to be more innovative,” she said.

Viable or not?

The plunge in fossil fuel prices is damaging the finances of the region’s oil producing countries, such as Argentina, Bolivia, Brazil, Colombia, Ecuador, Mexico, Peru and Venezuela, and state companies in the sector are facing problems with regard to planning and operations.

But it benefits net importers, like the countries of Central America or Chile, whose oil bills have shrunk, while for consumers in both oil producing and importing countries the cost of electricity could go down.

“The most competitive will be the countries with lower oil extraction costs. Some projects will not be economically viable. We will see greater economic problems than in 2019,” predicted Lisa Viscidi, director of the Energy, Climate Change and Extractive Industries Programme at the non-governmental Inter-American Dialogue, during a panel on the situation in several Caribbean nations.

The pandemic and a rise in Saudi production announced on Mar. 10 led to a collapse in oil prices and the consequent risk of bankruptcies in the industry. State-owned oil companies have fared better than others so far in the crisis.

In another session on the outlook for state-owned oil companies, John Padilla, managing director of the private consulting firm IPD Latin America, stated that “it will take time to get out of this situation, with effects for the region, and the need for great efficiency.

“Most nations have been exporters, efficiency will be the key. What has not been done is to cultivate domestic and regional markets, state enterprises are not going to play the same role as they always have,” he said.

Public companies such as Brazil’s Petrobras and Colombia’s Ecopetrol entered the crisis in a better position than Mexico’s Pemex, Venezuela’s PDVSA and Argentina’s YPF, according to experts.

“These are difficult times, even for the best prepared. We can hope that if the country and its company are in trouble, if governments need money, they can get more out of the companies,” said Francisco Monaldi, interim director of the Baker Institute for Public Policy’s Latin America Initiative at the private Rice University in the U.S. state of Texas.

In his view, “Mexico is in better fiscal conditions, it should not be a problem. But Pemex can drag Mexico down. If the government doesn’t change direction, it could become a serious problem,” he said as an example.

Although Pemex will increase its investment in 2020, the oil company reported losses of 20 billion dollars in the first quarter of this year. Due to the crisis, Petrobras limited its investment to 3.5 billion dollars and its daily production to 200,000 barrels, and postponed the sale of eight refineries.

For Lucas Aristizábal, a senior director in Fitch Ratings’ Latin American corporates group, some state-owned oil companies are viable and others are not.

“In 2021, the financial contribution of oil will be lower for governments. If they want the companies to play a key role, they will put more pressure on their financial structure. The current situation illustrates the economics of these corporations,” he said during the forum.

Pemex and YPF were already losing money per barrel in 2019, while Petrobras has more balanced production costs.

On the oil horizon, and in the midst of the COVID-19 crisis, Guyana has become the rising star, although there is still political uncertainty, as the result of the Mar. 2 presidential elections is still unclear.

“It’s hard to predict what will happen. There is a risk of U.S. sanctions that would not affect investment in the sector, but would pose a political risk to the country,” said Thomas Singh, in the Department of Economics at the public University of Guyana.

The country expects to extract 600,000 barrels per day by 2024 and take in revenues of five billion dollars, with reserves exceeding five billion barrels.

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