Energy Transition in Bolivia. Modelling of the Bolivian energy sector to achieve carbon neutrality by 2050

The 2018 IPCC special report emphasized the need to neutralize all CO2 emissions by 2050 to prevent global warming from exceeding 1.5°C. Bolivia, recognizing the urgency of addressing climate change, has taken steps in its electric sector to increase the use of renewable energy and retire inefficient power plants. However, these efforts are still limited considering the country's overall energy demand, with more than 80% of internal energy consumption in Bolivia coming from fossil fuels.
To determine the most cost-efficient approach to decarbonize its energy sector, an optimization model using OSeMOSYS was developed. This model considered national energy demands disaggregated by fuel and consumer type, focusing on techno-economic variables.
The model's results revealed that if no additional measures are taken (Business as Usual scenario), CO2e emissions from the energy sector will nearly double by 2040 compared to 2020, with 96% of energy sources still being fossil fuels. To explore alternative trajectories, four policy-based scenarios were examined: electrification of energy demands, carbon taxation, gradual reduction of fossil fuel subsidies, and implementation of energy efficiency measures.
While each scenario had limited effects individually, a synergistic effect was observed when their measures were combined (MP scenario). By 2050, 87% of Bolivian energy consumption would be covered by electricity, with over 96% of it coming from renewable sources, resulting in a 74% reduction in emissions compared to the Business as Usual scenario. However, even in this scenario, the energy sector would not be completely emission-free by 2050.
Achieving carbon neutrality in the energy sector by 2050 (CN scenario) would require significant investments, approximately 10% of Bolivia's current national GDP each year between 2020 and 2050. This represents a substantial increase compared to the investments needed in the Business as Usual scenario. To make the transition more feasible and cost-effective, exploring complementary measures involving other sectors or technologies is necessary.