Cuba's $8bn Renewable Energy Plan to Outsmart US Blockade

Cuba is on the brink of transforming its energy landscape with a bold plan to invest $8bn in renewable energy, which could reduce its reliance on fossil fuels and pave the way for energy independence from the US. The proposal, put forth by the Common Wealth thinktank's Transition Security Project (TSP), suggests that this investment could cover 93.4% of Cuba's electricity generation needs.

The US has imposed a crippling energy blockade on Cuba, severely limiting the island nation's access to oil. Since January, Cuba has received only one shipment of oil, from Russia, and its national electric grid has collapsed, leading to repeated blackouts and widespread disruptions.

The TSP analysis outlines four different scenarios for Cuba's transition to renewable energy, with costs ranging from $5bn to $19.2bn. The most ambitious proposal would see three-quarters of electricity generation provided by solar power, with wind, hydropower, and bioenergy making up the remainder.

The report argues that electricity costs would decrease in every renewable investment scenario, with the cost per unit of energy falling from 14.3¢ per kWh in the baseline scenario to 6.5¢ with $8bn of investment. The transition would require a society-wide transformation, but Cuba has demonstrated its ability to adapt in the past, such as its rapid shift to agroecology and self-sufficiency in the 1990s.

The question remains: who would pay for this transition? The report suggests that financing should be understood as "reparative climate finance", with Cubans able to pay back investments through savings on cheaper energy. The transformation would not only benefit Cuba but also set an important example of a rapid energy transition under conditions of external constraint.