Bolivia: Electric Powerhouse of Latin America
By Ollie Vargas
For the first time in Bolivia’s history, the country is now an exporter of electricity. As Europe struggles to keep the lights on, Bolivia’s nationalized electric company, ENDE, will provide Argentina with 132 thousand volts of electricity, announced Energy Minister Franklin Molina.
Why is this is important? This story shows us who will be successful in the age of lithium and hydrocarbon crises. The future lies with those ready to embrace sovereignty over western models of development.
“This connection marks a milestone in the integration of our countries and will allow the development of an entire mechanism for the exchange of electrical energy”, said Molina. This project will be officially inaugurated by both President Luis Arce and President Alberto Fernandez in a joint ceremony at the Bolivia-Argentina land border, at the beginning of April, revealed the Minister.
While the consumer price of electricity has increased as much as fifteen-fold in Europe, as a result of western sanctions on Russia, Bolivia is able to supply its own domestic needs without price rises for consumers. The country is now at a stage where it not only produces enough for itself but enough to export abroad for the first time in its history.
This moment is clearly a vindication of Bolivia’s state-led development model. The public electric company was privatized in the 90s during the US-backed neoliberal period. The result? By 2005, only 30% of rural Bolivia had access to electricity, the lowest in Latin America. After 2005, with the victory of the Movement Towards Socialism (MAS), the industry was nationalized and today rural access to electricity stands at over 90%, one of the highest in the region.
The free-market never provided the huge investments needed to extend access to electricity to all regions of the country. Many of those regions are extremely inhospitable, from the Andes mountains to the muddy roads of the Amazon, through to the arid deserts of the ‘Chaco’ in the southern regions bordering Argentina and Paraguay.
Needless to say, electricity is a basic right and a necessity for interacting with the modern world. Speak to anyone old enough to remember the ‘old days’ of the US-backed neoliberal period in Bolivia, including my own family who hail from the Andean mining towns of North Potosi. One had to be home before 6.30pm, failure to do so would leave you walking home using the light of the moon, if there wasn’t enough intergalactic light then placing your hands on the surrounding houses until you felt your own was plan B.
Eva Humerez, Senator for the Amazonion region of Pando, told me similar stories of rural isolation; “Before the MAS, in Sena (a small town in Pando), there were no roads. The only way in was a 6-hour canoe ride from the nearest town. People didn’t even have access to the radio, no one knew what was going on in the rest of the country. Today, all the young people in the town are on their smartphones using the internet.”
Bolivia’s state electric company is able to draw on a diversified set of energy sources: Hydrocarbons, solar, biofuels, hydroelectric dams, and now, lithium.
Hydrocarbons and hydroelectric dams have long been part of the national strategy, those were nationalized in 2006. A more recent development has been investment in green energy by the government of Luis Arce.
Whether it’s wind turbine farms in Santa Cruz, or biofuel plants that use recycled vegetable oil in El Alto, the Bolivian state has not been afraid to be an entrepreneur and launch these projects.
However, lithium is set to be an even bigger part of the state-led green energy transition in Bolivia and the world. Lithium is key for the transition to electric vehicles and batteries, with over 60% of the world’s lithium lying in the ‘lithium triangle’ that consists of Bolivia, Argentina, and Chile.
This has been acknowledged by the US military. SOUTHCOM Commander Laura Richardson stated; “With all its rich resources and rare earth elements, there is the lithium triangle, which today is necessary for technology. Sixty percent of the world’s lithium is found in the lithium triangle: Argentina, Bolivia, Chile.” She went on to express concern about how these countries are willing to work with China and others rather than US corporations.
The Bolivian model is to industrialize its lithium reserves within the country, under the state-company YLB, with a partnership with China to bring much-needed investments. Already batteries are beginning to be produced in it’s processing plants already installed in Uyuni, Potosi, with a further two plants set to be built with investment from China.
Bolivia’s model of state-ownership of natural resources has helped the country achieve a level of energy security that has allowed the country to not only keep the lights on, but to help neighboring countries keep their electric grid running. This is the future.
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