Publication - Renewable Readiness Assessment: Paraguay
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Title
Renewable Readiness Assessment: Paraguay
Publisher
IRENA
Author
IRENA
Published in
September 2021
Abstract
The energy mix of the Republic of Paraguay is dominated by clean energy sources,
with one of the highest shares of renewable energy in South America. Hydropower accounts for the largest share of the country’s power generation, representing around 99.5% of the installed power capacity. Consequently, Paraguay is highly dependent on the hydrological conditions of the rivers that feed the main hydropower plants of the country, where most of the electricity produced is exported to neighbouring countries.
Paraguay’s economy is based mainly on agriculture, livestock and the services sector, which has been growing in recent years. However, the global crisis caused by the COVID-19 pandemic has affected the country’s economy, reducing its Gross Domestic Product (GDP) by around 1% during 2020. Regardless of persistent challenges, Paraguay has experienced social and economic progress over the last two decades, with national policies and strategies increasingly contributing to the achievement of the Sustainable Development Goals (SDGs) and reiterating Paraguay’s commitment to reducing its greenhouse gas emissions by 2030. Advances include the ratification of the Paris Agreement in 2016, the National Climate Change Law of 2017, and the updated Nationally Determined Contribution (NDC) under the Paris Agreement submitted in July 2021. Paraguay’s renewable energy resources are vast and diverse and have an important role in enhancing energy security, mitigating climate change and promoting economic growth aligned to the United Nations 2030 Agenda for Sustainable Development and to the net zero objectives of the Paris Agreement. By 2020, renewables had reached a total installed capacity of around 8 832 megawatts (MW) with hydropower capacity alone accounting for 8 810 MW. Despite renewables being the largest source of Paraguay’s total energy supply, emissions have been increasing gradually due to the growing use of fossil fuels, mainly in the transport sector. During the period of 2010-2019, the import of oil derivatives (mostly petrol and diesel) increased rapidly, an average annual growth of 5.1%, making it the second-largest source of energy in the country. Paraguay sees the need to encourage the diversification of its energy mix through the adoption of renewable energy and net zero technologies. This would contribute to the decarbonisation of end-use sectors, the mitigation of greenhouse gas emissions, the promotion of energy efficiency, and the achievement of net zero emissions, while attracting investment and bringing diverse socio-economic benefits to the country’s population.URL
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