Beyond oil and gas

Beyond oil and gas: Costa Rica sets itself as an example


18 | 05 | 2023


With an almost entirely renewable electricity mix, the Central American country, together with Denmark, is driving the global commitment to overcome hydrocarbons.

In the picture

Hydroelectric plant on the Reventazón River in Costa Rica [IDB].

New energy urgencies in the wake of the war in Ukraine have led to a cooling of some efforts to accelerate the energy transition. However, two small states, Costa Rica and Denmark, are keeping alive the Beyond Oil and Gas Alliance (BOGA) initiative, which pushes purpose to make progress in reducing global oil and gas production. The election of Rodrigo Chaves as president of Costa Rica in 2022 has introduced a certain ambivalence in the commitment of his government, which has shelved a law that was intended to declare the country free of hydrocarbon production (in reality, it does not exploit them). In any case, the Costa Rican example leads the way: more than 98% of its electricity production is from renewable source .

The consequences of climate change have generated an awareness in governments of the need to adopt measures to curb this phenomenon, the most significant being the 2015 Paris agreement at COP21, the first universal agreement on the fight against climate change. In order to achieve the commitments established in that agreement of Paris, whose final goal is to prevent the global temperature rise from exceeding 2˚C, the need for national governments to embrace policies aimed at eliminating fossil fuel production has been highlighted. This awareness has culminated in the launch of Beyond Oil and Gas Alliance(BOGA), one of the most significant commitments made by countries at COP26 in 2021.

BOGA is an international alliance of governments and stakeholders working to facilitate the controlled phase-out of oil and gas production. The partnership, launched by the governments of Denmark and Costa Rica, aims to goal prioritize the issue of oil and gas production phase-out on the international climate diary , promote actions and commitments, and to facilitate the creation of international practice on this issue.

BOGA has fourteen national and subnational governments, divided into three different levels of participation. First, full members that have committed to adopting policies to phase out their oil and gas production, including Denmark, Costa Rica, France, Greenland, Ireland, Quebec, Sweden and Wales. Secondly, associate members, such as California, New Zealand and Portugal, who have adopted oil and gas reduction measures, but do not meet the requirements necessary for full membership. Finally, the friends of BOGA, a category used to refer to actors aligned with the objectives of BOGA, such as Italy, Finland and Luxembourg.

source Costa Rica and Denmark's interest in this alliance stems from the recognition that, despite the fact that fossil fuels are the main source of greenhouse gas emissions, there was no international governmental agreement to end their production. It is worth highlighting the strong commitment of Costa Rica, a country whose Constitution enshrines the right to a healthy and ecologically balanced environment.

In recent years, the presidency of Carlos Alvarado (2018-2022) had embraced a project law to permanently prohibit the prospecting of fossil fuels, despite being a country that does not extract oil or gas. Currently, oil exploitation is prohibited until 2050 by a presidential decree, so, due to the ease with which it can be revoked, Alvarado's government wanted to reinforce the prohibition through an initiative called "Law to Eliminate the Use of Fossil Fuels in Costa Rica and Declare the National Territory Free of Exploration and Exploitation of Coal, Oil and Natural Gas". Said initiative obtained the majority of the Permanent Special Environmental Commission of the Legislative Assembly in October 2021 and then continued its processing, but for the time being it has lapsed after the presidential replacement in May of the 2022 elections.

Rodrigo Chaves is of agreement in not allowing oil explorations, but he is sample open to possible gas prospections, which in any case have not been considered either. "If the gas exists and we prove the existence of resource, we can manage it in a way consistent with a healthy and clean environment.... I don't think we have to take the almost religious fanaticism of saying: let's not allow Costa Ricans to use and benefit from a resource that God gave us", he said before becoming president, in an electoral discussion .

Nevertheless, Chaves intends to maintain Costa Rican society's desire to position itself as a world leader in the environmental field, promoting the fulfillment of global goals for the fight against global warming and favoring the use of sustainable energies. Certainly, Costa Rica is one of the countries that has committed to decarbonize its economy by 2050, through the 2019 Costa Rican National Decarbonization Plan, promoted by the previous government. To this end, it has established economic and social measures with the intention of achieving zero net emissions by the turn of the century. These commitments to protect the environment earned it the 2019 awardUnited Nations Environment Programme's Champions of the Earth.

Thus, Costa Rica has reversed decades of deforestation, achieving that 53% of its territory is occupied by forest; it has also established numerous protected or reserved areas and has made great progress in the energy transition, with more than 98% of its electricity generation coming from renewable sources, levels that have been maintained since 2015. In 2022, the electricity mix consisted of 70.08% hydroelectric production, 14.18% from geothermal, 13.46% from wind and 0.86% from solar and biomass; the remaining 1.42% was contributed by thermal power plants.

Although Costa Rica only produces 0.02% of global emissions, it wants to establish itself as an exemplary country that inspires other countries with higher carbon emissions to adopt the necessary measures to combat global warming. In fact, Costa Rica is at the forefront of decarbonization in the world, together with Uruguay, Norway, Finland, Paraguay and Iceland.

However, it is worth mentioning that the biggest challenge for Costa Rica in its decarbonization policies will be the transportation sector, as the demand for automobiles -source of greenhouse gases - has been increasing, and public transportation is also widely used by the population. In total, the transport sector is estimated to account for 40% of the country's total emissions. Moreover, there has also been criticism that these ambitious commitments may be an obstacle to halving the fiscal deficit that the country saw increase during the pandemic emergency. It is also worth mentioning the relative ambivalence of Rodrigo Chaves' presidency which, despite promoting environmental policies, has warned that governments have focused excessively on decarbonization, ignoring other more urgent aspects in this same field such as water cleanliness, recycling and the deficit of environmental infrastructures.

At final, Costa Rica has pursued a policy of decarbonization of its economy, which it has also reflected on the international scene through the BOGA alliance. However, BOGA's mission has been complicated by the energy emergency imposed by the war in Ukraine. The boycott of Russian oil and gas has led several Western countries to try to resolve their energy security rather than accelerate the transition to renewable sources. High energy prices and supply constraints have meant that European countries that were considering ending fossil fuel production have opted to increase their domestic production capacity or import liquid natural gas. This new degree program for gas, along with the pandemic immediately preceding it, seems to have erased some of the progress in global awareness of the need to combat climate change.