Document Type
Report
Publication Date
4-2024
Abstract
Cuba’s energy sector is at a crossroads. The country’s mostly fossil fuel-fired energy system faces a number of longstanding and serious challenges, including breakdowns at aging power plants, decreasing fuel imports and fuel shortages, and the growing threat of climate change-related disruptions. In recent years, Cuba has seen frequent electric blackouts and brownouts that have affected residents, businesses, and government institutions island wide.
Compounding these problems, Cuba is facing a severe economic crisis. In 2022, year-on-year inflation was 39% (down from 77% in 2021). While inflation is estimated to have dropped to 30% in 2023, the price of food increased 78%. Residents of Cuba are expected to experience a new wave of inflation in 2024 following the government’s announcement of a new austerity plan that will include price and tax increases and cuts in subsidies. Further, according to Cuba’s Minister of Economy and Planning, export earnings in 2023 were just $9.1 billion (down from $12 billion in 2019), missing the forecasted $9.9 billion.
Overcoming Cuba’s energy challenges amidst the economic crisis will be no small task, requiring substantial investments of capital, which have been hard to come by given real and perceived risks of investing in Cuba under current circumstances and other regulatory and legal obstacles. New policies and systemic changes, and an overall reimagining of the country’s energy system, will be essential to attract the new investment needed to enable a clean energy future.
Over the past 10 years, Cuba has begun to embark on an energy transition. Recent shifts in law and policy create new and promising opportunities and indicate a desire on the part of Cuba’s policymakers to transition to a cleaner, more climate resilient energy system. Cuba committed to generating 24% of its electricity from renewable energy sources by 2030 as part of the country’s Nationally Determined Contribution (NDC) under the Paris Agreement. Policymakers have subsequently announced their intent to increase renewable electricity generation to 37% by 2030. Additionally, in 2019, Cuba updated its constitution to explicitly state that the government must respond to climate change and aims to promote foreign investment for economic development. Cuba’s intention to transition to renewable energy generation is key, as renewables can provide climate change mitigation, reduced local air pollution, and resilience benefits over the current fossil fuel-fired power generation system.
This report provides detailed information on the current state of Cuba’s energy sector and identifies opportunities to accelerate the deployment of renewables and advance climate resilience. The information provided is intended to help support future decisions on planning and policy in Cuba, foreign policy in the United States and other countries, and private and public investment in the country’s clean energy transition.
Disciplines
Energy and Utilities Law | Environmental Law | Law
Recommended Citation
Korey Silverman-Roati et al., Building a Cleaner, More Resilient Energy System in Cuba: Opportunities and Challenges, Sabin Center for Climate Change Law and Environmental Defense Fund, April 2024
Available at: https://scholarship.law.columbia.edu/sabin_climate_change/220
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