CIGI at The Summit of the Americas

Annette Hester, CIGI Senior Fellow and CIC Research Associate

Most of the 34 hemisphere presidents have arrived and the Summit of the Americas will be officially underway in less than half an hour. There has been much anticipation regarding how President Obama will shift the US relationship with the Americas. While he is likely to stress human security, economic development, and the impact of the financial crisis on the countries in the region, he is certain to address the energy and environmental sectors.

In fact, the United States will be issuing an open invitation, on a voluntary basis, suggesting a Hemispheric Energy and Climate Partnership. The initiative will focus on four overall areas of cooperation. To start, governments will be asked to offer their views on what should be included and there will be promises of a continued dialogue. A variable geometry will allow some governments to cooperate on some subjects, but not others — making the initiative voluntary and a la carte. Cooperation will likely include energy efficiency, renewable energy, cleaner fossil fuel, energy infrastructure and energy poverty. Still, there is room for others areas to be singled out.

The sense from the Americans is that they are open to the participation of national labs, research centres, universities and government agencies in order to facilitate technology cooperation. They would then work with the OAS, the Inter-Development Bank as well as others to share best practices, build capacity, accelerate renewable energy, and promote energy efficiency. The stress however is that this is an aim to deepen cooperation – not a negotiation on climate change.

This is exactly in line with our proposal, a Blueprint for a Sustainable Energy Partnership in the Americas. Needless to say, we hope all other countries in the hemisphere embrace this proposal and get set to make it happen.

On the eve of the fifth Summit of the Americas in Trinidad and Tobago, the US delegation is discussing details of its proposed “Energy Partnership for the Americas,” which will likely include specific measures that individual countries could agree too.

However, the US is not aiming to attain approval from all member countries with the proposal, sources familiar with the discussions said.

The exact initiatives contemplated in the proposal have not been made public, but participants from think tanks, non-governmental organizations and the private sector are presenting specific measures for a regional energy partnership which they hope the participating countries will adopt.

“In considering the energy partnership, key elements might include collaboration in the use of renewables, energy efficiency and cooperation on and integration of cross-border elements, such as power line interconnections,” Mark Lambrides, division chief of Energy and Climate Change for the Organization of American States (OAS) told Oil Daily.

Although as a region the Americas is a major hydrocarbons producer, many countries import large quantities of oil and gas, and energy security is a key issue on the summit agenda.

The region is divided between countries with hydrocarbons and those without, explained Robert Riley, chief executive of BP, Trinidad and Tobago during a pre-summit panel discussion. “Those with [hydrocarbons] make their way and are not driven to implement new policies, especially on the consumption side, and those that don’t struggle with technology that isn’t developed enough to compete with hydrocarbons,” he said.

To improve the reliability of energy supplies, the Western Hemisphere should increase the number of electrical interconnections between countries and diversify the energy matrix, according to a report prepared for the summit by the OAS.

Diversifying energy sources would also help shield importers from volatile oil and gas prices, panelists noted.

Expanding alternative energy resources is central to achieving diversification — particularly in Central America and the Caribbean, where most countries rely excessively on imported hydrocarbons.

Brazil, often hailed as a paragon of energy diversification, has spent over 30 years developing its ethanol program despite the ups and downs of the oil market.

The US and Brazil are expected to propose expanding a biofuels partnership started in 2007 by inviting new countries to join and allocating additional resources to programs that help third party countries establish biofuels programs.

Most countries will also have to strengthen their regulatory frameworks to encourage private investment in alternative energy sources.

Jeremy Martin, director of the energy program at the Institute of the Americas, suggests the summit should focus on transparent regulatory, legal and fiscal regimes. “Energy governance in the region must be open to, and incentivize, private investment across the entire energy chain,” he wrote.

Participants also suggested sharing and applying new technologies to enhance energy production and improve efficiency.

The “Blueprint for a Sustainable Energy Partnership for the Americas,” a report issued by the Center for International Governance Innovation in Waterloo, Canada suggests making technology more widely available to companies across the Americas.

According to the report, governments in the region should work toward developing joint technologies that can be made available to companies at a fair price.

Another core theme on the summit agenda is the notion that expanding alternative energy sources and improving efficiency would contribute to environmental sustainability.

However, sources said climate change issues — such as a proposal to create a North American or Pan-American carbon market — have been taken off the agenda as they were considered too controversial.

Much of the hype over the last few days in Trinidad and Tobago has surrounded the arrival of President Barack Obama at the Summit of the Americas.

In anticipation of this event, he has written an op-ed (translated into Spanish and Portuguese) that will appear in several newspapers throughout the Americas. In the piece, he recognizes that the United States has often failed to sustain engagement with its neighbors within the hemisphere and renewed his commitment to build stronger relationships with representatives from the region.

President Obama goes on to cite the amended Cuba policy as an example of how his administration is working to overcome the challenges brought on by the economic crisis through enhanced cooperation. According to the article, while the United States is hoping to reinvigorate trade through its national stimulus package, collective international action is still required in order to ensure long-term prosperity.

To read the full article, please click here.