Latin America is making the switch. Long reliant on oil and gas, the region’s economies have lined up billions of dollars in investments to develop renewable energy projects and meet ambitious targets in years to come.

Brazil, South America’s largest economy, expects to get 23% of electricity generation from renewable sources by 2030, while Mexico is aiming for 35% by 2024 and 50% by 2050, according to the latest report from the renewable energy policy network REN21. Chile wants 20% by 2025.

Despite the lofty goals, renewable energy investments in Latin America slipped in 2016, due in part to a sluggish economy in Brazil, slow-moving energy reforms in Mexico and lower development costs for solar and wind projects.

The Brazilian government cancelled the one renewable power auction it had scheduled for last year, but the country commissioned roughly 2 gigawatts in wind power projects in 2016, taking the total above 10.7 GW, and met 5.7% of electricity demand from wind power sources, according to REN21.

Investors are still coming to Brazil’s renewable energy sector, especially foreign firms looking to buy operating assets. The US power company AES Corp acquired the Alto Sertão II wind farm from Renova Energia for 600 million reais ($180 million) and said it is pursuing more acquisitions, as it aims to get 50% of Ebitda from non-hydroelectric sources by 2020.

Other investors, such as Brookfield and Cubico Sustainable Investments, are likely to buy more renewable energy assets in Brazil, while France’s Engie is expected to keep investing in Latin America. Chinese investors will also keep coming, following the lead of State Power Investment Corporation (SPIC). 

Chile held a large energy auction last year, looking for developers to provide approximately one-third of the country’s energy needs over the next 20 years. Wind power projects represented roughly 40% of the winning bids, which also included a quote for the lowest priced solar project to date.

The Santiago subway system has said it will get 60% of its energy from renewable sources in 2018, with 42% from solar and 18% from wind. But up north, construction has stalled on the Atacama 1 solar project, where Spain’s Abengoa has transferred control to US energy investment firm EIG Partners.

Argentina did not bring any projects online in 2016 but President Mauricio Macri has decreed 2017 as the year of renewable energy, looking for clean sources to match 8% of demand before the end of the year and 20% by 2025. The country has held the first auctions under the RenovAr program, granting licenses for 59 projects with 2,423 MW in capacity. Those projects now need to raise funds, and developers have turned to multilateral lenders, such as the World Bank and the Inter-American Development Bank (IDB), as well as the cross-border bond market to secure financing. 

Mexico last year auctioned 23 clean energy projects, mostly wind and solar with around $4 billion in project costs. The winning bidders are still getting regulatory approvals, and some may seek investment partners before they begin construction, but they could start to find financing before the end of the year. LF