The Energy Transition in North America: Context, Challenges, and Agreements

An overview of the energy transition in North America, including its background, challenges, and possible agreements between Canada, the United States of America, and Mexico. The article also highlights the geopolitical changes and competition between energy security and decarbonization.

The Energy Transition in North America: Context, Challenges, and Agreements
Clean and green energy: A row of solar panels generating renewable electricity from the sun's rays. Photo by Zbynek Burival on Unsplash

Energy plays a critical role in shaping national security scenarios, economic development, and military capabilities. Alejandro Martín Solís Tenorio, Director of Graduate Studies in Quality and Renewable Energy at the Autonomous University of Guadalajara, provides a concise and comprehensive overview of the Energy Transition in North America, focusing on the context, sector, and agreements.

The North American region's energy sector is highly carbon-intensive, with at least 80% of its energy matrix comprised of fossil fuels, and clean energies accounting for no more than 20%. This region also generates a Gross Domestic Product equivalent to $22,003.81 billion US dollars and has 495.14 million inhabitants. It is also responsible for 75% of total emissions in the Americas, and at least 20% of the global total.

The Energy Transition in North America represents a set of geopolitical changes, raising scenarios of political agreement to support "climate security on a global scale." However, given the changes in the world order, energy security is also a priority that could compete or contribute to the sense of urgency for decarbonization in the region.

At the 26th Conference of the Parties (COP26) in Glasgow, representatives of 197 nations established action commitments to reduce greenhouse gas emissions to zero by 2050, with the aim of limiting global temperature increase to less than 1.5oC. The commitments also include actions to bring funds to developing countries to manage the negative impacts of climate change. The challenge to slow or contain the increase in global temperature is immense, especially considering the need to guarantee the global energy supply in the conditions of the post-COVID global economy.

The Energy Transition requires successful efficiency strategies along the entire energy chain, as well as a change in the supply-demand matrix, with a predominance of clean sources that currently cannot guarantee energy supply in the face of the economic and social dynamics of the region or the world. The Paris Agreements' objectives depend on the effectiveness of implementation policies and the certainty necessary to attract investments, particularly in the case of Mexico. External resource mobilization, effective technology transfer models and processes, and talent training are all key elements for cooperation at the regional level.

In January 2023, the leaders of Canada, the United States of America, and Mexico met and agreed to strengthen the security, prosperity, sustainability, and integration of the region in six strategic pillars, one of which is the Energy Transition. Among the agreements for the energy transition in North America, four areas with potential for cooperation between the three nations were explored:

  1. Renewables as a key enabler for a new energy system: Complementary technologies, updated infrastructure for transmission, interconnection and storage, and innovation in business models.
  2. Resilient infrastructure with the capacity to adapt to new technologies: Infrastructure with the capacity to operate reliably in the face of changes or meteorological events resulting from climate change. Additionally, it is necessary to integrate the capacity for transportation and distribution of Natural Gas with that needed for the transportation and distribution of Hydrogen.
  3. Development of Natural Gas (NG) as a transitional energy source: NG constitutes a key element of the transition, due to its capacity to supply the intermittency of some clean sources such as solar and wind.
  4. Carbon Capture: Through the development and application of technologies to capture carbon in the air.

Along with these four areas, the potential to develop Hydrogen as a source, and even more as a clean energy economy, to which it is possible to transition from the current Natural Gas economy, with applications to electric transportation and stationary generation for community supply, can be glimpsed.

Source: UAG Press Bulletin