Latin America and the Caribbean are at a turning point in their energy future. In a global context marked by climate urgency, technological transformation, and the need to ensure both energy security and economic development, the region is moving toward an energy transition that combines climate ambition with technical realism and a long-term strategic vision. The Latin America and the Caribbean Energy Outlook 2025, presented by OLACDE, confirms this trend and provides strong evidence of a new regional energy landscape in motion.
The 2025 results show significant progress. Renewable power generation capacity increased by 7%. Today, 67% of the electricity available in the region comes from clean sources, with wind and solar playing a leading role (61% of new installed capacity during the year), increasing their output by 19% compared to last year. These figures reflect not only the region’s natural resource potential, but also favorable regulatory frameworks, growing technological expertise, and rising investment interest in environmentally sustainable projects.
In 2025, final electricity consumption increased by 3.7%, while per-capita consumption rose by 2.6%. These indicators reflect economic progress linked to electrification — a key element for building more efficient and decarbonized power systems. As this trend advances, energy storage is beginning to make an increasingly relevant contribution: the region now has 1.7 GW of installed battery capacity, which plays a critical role in managing renewable generation variability.
At the same time, natural gas is consolidating itself as the main firm capacity resource during the transition. Gas-fired generation capacity increased by 12% in 2025, while coal- and oil-based generation declined significantly, by 21% and 31% respectively. This trend reinforces the role of natural gas as a strategic backup resource, complementing renewable energy and helping to reduce greenhouse gas emissions compared to more carbon-intensive fossil fuel alternatives.
A similar shift can be observed in the transport sector. Electric mobility in Latin America and the Caribbean is expanding rapidly. Between 2022 and 2025, the total number of electrified light-duty vehicles in circulation grew by 851%, nearly multiplying by ten, while sales increased by 52% in 2025 alone. This phenomenon anticipates structural changes in energy demand, urban planning, and electricity infrastructure, positioning the region as an emerging market for electromobility.
Looking ahead to 2050, projections under an accelerated decarbonization scenario (NET-0) reveal both major challenges and monumental opportunities. Total energy consumption would increase by 42%, while electricity consumption would grow by 156%. Installed power generation capacity would need to triple, reaching an 83% renewable share, with wind and solar expanding particularly fast — multiplying their installed capacity fivefold.
This scenario would require around 1,000 GW of additional electricity generation capacity and approximately 80 GW of battery storage systems, with an estimated investment requirement of nearly USD 1.5 trillion, 90% of which would correspond to renewable capacity. Natural gas would continue to play a relevant role: around 22% of electricity generation in 2050 and 34% of total energy supply would come from it, while oil and coal participation would decline substantially.
Within this horizon, new demand drivers are clearly emerging: transport electrification, the expansion of data centers, and green hydrogen. Combined, these uses could represent a significant share of regional electricity consumption by 2050, calling us to plan today for more robust, resilient, interconnected, and responsive power systems.
The Latin America and the Caribbean Energy Outlook 2025 is consolidated as a strategic publication for governments, institutions, investors, and academic circles alike. Its data and projections confirm that the region is moving in the right direction — but also that the success of the transition will depend on timely decisions that strengthen regional cooperation, stable regulatory frameworks, and an unprecedented mobilization of investment and technical capacity.
At OLACDE, we remain committed to working alongside our 27 Member Countries, continuing to provide accurate data, technical analysis, and spaces for dialogue that transform these challenges into opportunities for sustainable development across our region.
