Latin America is located in the center of an energy paradox that defines its present and its future. The region has one of the largest natural reserves to produce renewable energy in the world, but continues to depend significantly on fossil fuels to support their economies. The green transition is a global imperative, and although official speeches often underline environmental commitment, in the daily life of Latin American countries it is still oil, gas and coal that drive transport, maintain whole industries and finance national budgets.
The contradiction is evident: while fossil consumption figures remain high, investment in renewable projects grows strongly. In this crossroads, Latin America does not face only an energy dilemma, but the opportunity to consolidate as a strategic pole capable of attracting capital, generating jobs and offering a competitive advantage in the global reconfiguration of productive chains.
According to the International Energy Agency (AIE), in Latin America fossil fuels represent about two thirds of energy consumption. While this figure is better than the global average – 80 %cuter – continues to be too high for a region that aspires to lead the transition.
Transport is the most illustrative sector of this dependence: gasoline and diesel remain the basis of the mobility system in most countries. Even Brazil, considered a leader in ethanol production and with an electrical system dominated by hydroelectric plants, still obtains about half of its total oil consumption. In Colombia, the panorama is more forceful: oil and coal are at the same time energy and economic pillar. Venezuela maintains its almost absolute dependence on crude oil exports, while Mexico, despite advances in solar and wind energy, continues to allocate billions of dollars to the Pemex support.
Present resources threaten the future
These examples show the magnitude of the challenge. The resources that finance the present are the same that threaten to put the future at risk, catching the region in a hybrid that seems difficult to overcome.
In contrast, electricity presents an encouraging panorama. According to Ember data (2024), 65 % of electricity in Latin America comes from renewable sources, a percentage far from 41 % of the global average. The region does not start from zero: it already has a solid base that can become a competitiveness platform.
Uruguay has established itself as a world reference, with a 98 % renewable electricity in 2023. Costa Rica and Paraguay are approaching 100 % and Brazil around 90 %. This strength translates into a magnet for large corporations: Amazon, Microsoft and Google have installed data centers in Brazilian territory because they can guarantee operations with clean electricity.
Dynamism is also reflected in Chile, turned into a green hydrogen laboratory with projects that seek to export clean energy to Asia and Europe. For its part, Mexico houses the largest solar park in Latin America in Sonora, while Argentina develops wind complexes in Patagonia with the capacity to compete in international markets.
The region already has a green infrastructure that is not promise, but reality. The challenge lies in taking advantage of it strategically to position itself as a reliable supplier of clean energy in the global economy.
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Nearshoring and the Green Window
The Nearshoring phenomenon – the relocation of productive chains towards territories closer to consumer markets – has become an additional catalyst. Latin America has a unique advantage over this process: not only geographical proximity with the United States, but also the possibility of offering renewable, abundant and competitive energy.
The combination is powerful. A company that installs operations in Mexico, Colombia or Brazil can communicate that it produces with one of the cleanest electric matrices on the planet. In Colombia, renewable capacity is projected with a 36 % growth around 2025, backed by investments that exceed 500 million dollars. In the Peruvian Amazon, indigenous women lead solar projects that replace diesel and transform entire communities, while in Brazil data centers are attracted to artificial intelligence that work with renewable electricity.
This model of “green nearshoring” is not only an aspirational narrative, but a concrete regional development proposal and a geopolitical argument of great weight. The United States, in its effort to diversify chains against China, finds in Latin America three decisive advantages: geographical closeness, clean energy availability and a young population with productive potential.
Despite the potential, the energy transition in the region faces considerable obstacles. Fossil exports dependence remains a determining factor in countries such as Colombia, Venezuela or Mexico, where oil and coal represent not only fiscal income, but also political stability.
Along these lines, the regulatory framework advances slowly. In Colombia, wind projects have faced significant delays, while in other nations the bureaucracy limits the speed of investments. In addition, the predominance of hydroelectric plants raises an additional risk: the growing vulnerability to climate change and prolonged droughts, which question the security of the supply.
The transition does not depend solely on technology. It requires durable political agreements, solid institutions and, above all, the active participation of communities. It is not enough to install solar panels or wind turbines; It is essential to build social trust and establish legal frameworks that guarantee long -term certainty.
The risk is clear: that the region remains trapped in a dysfunctional hybrid, with renewable projects that do not take off and a fossil dependence that extends more than necessary.
The current situation offers Latin America the possibility of redefining its role in the global energy map. Few regions combine so favorable abundant natural resources, increasing demand and closeness to large markets.
The strategic equation is evident: simplify regulations, diversify the energy matrix, integrate communities and form human capital. If you can consolidate these conditions, Latin America may stop being seen as “oil and coal producer” and become “future producer.”
Uruguay has already demonstrated that it is possible. In just a decade, he went on dependent on fossil fuels to consolidate as a world reference in clean electricity. That jump was not only technical, but also political and cultural. It represents a lesson for the entire region: the transition is viable if there is collective will and strategic vision.
The reality is undeniable: the fossils still dominate, but the renewables already ceased to be promise. In this scenario, green nearshoring should not be understood as another option, but as the great opportunity of this generation. Well managed, you can turn Latin America into the protagonist of the new world energy map and an example of how to transform a paradox into a historical advantage.
This article is part of the print edition of Forbes Mexico of October 2025.
The author is founder and CEO of ENTI – National Specialists in Technology and Innovation, Mexican firm focused on digital transformation solutions, cybersecurity and business intelligence. With more than 20 years of experience leading strategic processes in key sectors such as aerospace, automotive and financial, Mora is a promoter of intelligent nearshoring and a reference in the evolution of corporate leadership towards more human, sustainable and visionary models.
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