Energy Integration For The Western Hemisphere


The nations of the Western Hemisphere have made major strides toward greater opportunity, democracy and prosperity. However, said Under Secretary of Political Affairs Wendy Sherman, costly and unreliable supplies of energy prevent millions of people in the region from enjoying the full benefit of these important improvements:

“Central America and much of the Caribbean pay very high prices for electricity – ranging from two to five times what we pay here. … Expensive electricity hurts competitiveness, undermines investment, slows job growth, and ultimately undercuts the welfare and security of households.”

That is why the United States is committed to promoting regional electricity integration. One example of this commitment is Connecting the Americas 2022, or Connect 2022, a hemispheric initiative under the Energy and Climate Partnership of the Americas that seeks to provide all citizens of the hemisphere with access to reliable, clean, and affordable electricity through increased electrical interconnection.

Recently, the Inter-American Development Bank and the U.S. Department of State hosted talks supporting Connect 2022. During the meeting, Energy, Finance, Environment and Foreign Ministers from Central America, Mexico, Colombia, and the Dominican Republic discussed the Central American System for Electrical Integration Project, or SIEPAC, which connects Central America’s national power grids to create a regional market of 37 million consumers. At the Connect 2022 meeting, said Under Secretary Sherman, the leaders “pledged to work together”:

“To create a modern, commercially viable electricity network in the Western Hemisphere that attracts private investment and transforms power markets to incorporate cleaner, renewable, and more efficient sources of energy.

Articulating a vision for how Connect 2022 can benefit the region, Under Secretary Sherman noted that new regional market rules have been put in place that will improve the business climate for energy investments. Specifically, model contracts for attracting necessary investment and mechanisms to resolve disputes in the region are being developed and implemented:

“The $25 billion in power sector investment we need by 2030 will not come from the collective treasuries of the countries in this region. If we can create the conditions that allow businesses to make a return on their investments, it will not have to.”

“Now is the time for definitive action,” said Under Secretary Sherman. “We have the knowledge and the means to do all these things. All we need is political will, leadership, and courage.”