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A/S Pyatt:  Thank you for inviting me to speak today.  As I was saying to Dr. Mossi as we were in the Green Room before this began, 33 years ago when I started my Foreign Service career the State Department sent me out to Tegucigalpa as an economic officer and at that time among my responsibilities was CABEI.  So, I was working then for one of the greats of our Foreign Service, Ambassador Cresencio Arcos.  And every time Ambassador Arcos went to see the leadership at CABEI I was the guy who had to write the memo and come along and take notes.  So, it’s with great affection that I join you today but also great appreciation for the important work that CABEI does and the importance of our relationship with the countries of Central America and the critical catalytic role that CABEI plays in America’s interest in helping to build regional economic integration and cooperation.

On the first day of his administration, President Biden issued an Executive Order on Tackling the Climate Crisis at Home and abroad which makes climate consideration an essential element of America’s foreign policy.  Energy, how it is produced, transmitted, used, and conserved is fundamental to addressing the climate crisis and under President Biden’s leadership the United States is taking unprecedented steps to accelerate the clean energy transition both domestically and abroad.

I just recently returned from the United Nations Conference of the Parties on the UN Framework Convention on Climate Change or COP where I emphasized in all of my international committees the urgency of clean energy transition, the imperative of energy diversification, and the necessity of cooperation between governments and the private sector to build our future energy ecosystem.

The State Department is acting with urgency to accelerate the development of clean energy technologies and secure, diverse, resilient supply chains to meet the expected dramatic increase in demand for critical minerals necessary for clean energy transition.  Within the State Department the Bureau of Energy Resources that I lead is tasked with developing and executing international energy policies and balancing the historic drive towards the clean energy transition with the ongoing need for energy security.

A central component of the long-term strategy of the United States for pathways to that zero greenhouse gas emissions by 2050 is in transportation, and in particular the expanded use of new transportation technologies including a rapid expansion of zero emission vehicles in as many applications as possible across the light, medium, and heavy vehicle sectors.  Already the growing popularity of electric vehicles supported by both incentives and continued dramatic advances in battery technology is spurring greater electric vehicle adoption and industry goals bringing higher electric vehicle sales.

President Biden’s goal is to ensure that half of all vehicles sold new in the United States by 2030 are zero emission vehicles including battery electric, plug-in hybrid electric, or fuel cell electric vehicles.  Other technologies can serve as important complements to the EVs as well including interoperability with smart grid applications to ensure resiliency and the development of a thick network of charging options.  In this regard I was glad to see [inaudible – that we’ve got our friends from Blink over here in the corner. Blink is one of the companies that I worked with when I was Ambassador in Greece and I saw in that context how important this question of charging networks is to the larger deployment of electric vehicles.

Further, reliable interoperability, for both software and hardware, for smart and bidirectional charging solutions will support vehicle-to-grid integration.  That, in turn, will help stabilize electric grids and facilitate the integration of ever more renewable electricity generation.

This comes back to the focus on infrastructure. Globally, in response to the forecasted substantial increase in the market for electric vehicles, many initiatives are underway to build public and private charging infrastructures.  However, we still need to gather the technical data and tools to test and assess the resiliency and potential benefits.  This will be important to preventing local grid overload, service disruptions, and cybersecurity risks once significant systematic deployment of the charging infrastructure is in place.

Grid operators at all levels are looking for predictability, as they are responsible for stable business conditions and service quality.  However, new charging infrastructure if not properly regulated and incorporated into system planning and operations, can be a disruptive technology and disruptive not in a good way.

This is a concern for customers as well.  Drivers typically know whether their car takes regular unleaded or premium gasoline, but when their fuel is electricity, filling up can be confusing to EV drivers who are trying to find the best chargers and plugs for their particular vehicle.  Therefore, international collaborative efforts between technical and planning bodies can support and guide the roll-out of compatible charging technologies and overall implementation of charging sites by both charging points and grid operators.

The work is expected to bring even more certainty to public authorities and private investors, improving the quality of infrastructure and benefiting society.  The United States is not alone in setting in motion ambitious plans for transition, and we applaud countries like Costa Rica, which now generates 99 percent of its energy from renewable sources and has provided wide-scale electric vehicle adoption.

We recognize the recent strides that both Panama and Guatemala have made to facilitate the import, sale, and use of electric and hydrogen vehicles for transportation systems.  Panama has gone a step farther by mandating the use of electric vehicles in its public fleets.

The State Department’s Energy Resources Bureau has a Power Sector Program that advises El Salvador’s regulator on how to implement the country’s sustainable transport law.  We believe this will help El Salvador to develop technical norms and incentivize electric vehicle deployment.

As we look at the proliferation of electric vehicle solutions in markets throughout the region, the United States is taking several other steps to create an overall enabling environment.  We think building greater regional resilience and investment in supply chain diversification will make our hemisphere less vulnerable to global disruptions.  We’ve already made progress to strengthen supply chains for health, food security, and technology in the region.  The United States and Mexico created a supply chain working group focused on semiconductors and information and communications technology. And we’ve initiated bilateral supply chain consultations with Brazil.

Even as we build greater economic and energy resilience across the hemisphere, we need to ensure we’re supporting democratic resiliency as well.  In that vein the United States is working alongside Costa Rica, Ecuador, the Dominican Republic, and Panama as they develop the Alliance for Development in Democracy, and we continue to call on all international financial institutions, especially CABEI, to ensure that lending supports the people of the Americas and does not shore up authoritarian governments clinging to power in our own hemisphere.

One of the hard-learned lessons from the pandemic and a hard-learned lessons from Putin’s war in Ukraine is the realization of the fragility of our existing rules-based global system.  Building resilience in our supply chains demands pooling our individual strengths to make our democracies stronger together.

In a similar vein, the clean energy transition presents enormous economic opportunities for countries with critical minerals including the United States.  The Biden administration is increasing domestic capacity for critical minerals mining, processing, and recycling and working through partners to bolster local critical mineral supply chains.

The United States recognizes this is a challenge we cannot solve unilaterally.  We must work together.  Our recently launched Mineral Security Partnership is an ambitious new effort that brings together a group of governments to catalyze public and private investment for strategic mining, processing, and recycling opportunities that bolster supply chain resilience, ensure greater local economic benefit from critical minerals extraction and processing, and promotes the highest environmental, social, and governance standards.

The group of Mineral Security Partnership governments now includes Australia, Canada, Finland, France, Germany, Japan, Republic of Korea, Norway, Sweden, the UK, the U.S. and the European Union.  Partners are together considering strategic critical minerals projects with potential support across the globe.  The makeup of the partner group does not constrain or delineate which minerals or which countries can benefit from potential support through the partnership.

Separately the Biden administration through the call to action on root causes of migration strategy encourages companies to invest more in the Americas particularly in critical sectors that create good jobs such as pharmaceuticals, agriculture, critical minerals, semiconductors, electric vehicle batteries, and other advanced manufacturing.

Supporting this, two recent pieces of legislation represent a significant opportunity for nearshoring in our region.  The Inflation Reduction Act and the Bipartisan Infrastructure Law provide policy and investment environment certainty in the United States for years to come.  These laws will be a gamechanger in how our energy economy is organized.

Together they position the United States to meet President Biden’s goals of reaching net zero emissions no later than 2050 and getting halfway there within this decade.  Both laws will spur investment in manufacturing and supply chains in key industries such as solar, wind, carbon capture, electric vehicles, and clean hydrogen while reducing US emissions by about 1 gigaton, that is a billion metric tons by 2030.

These two laws present a significant opportunity for firms operating in the electric vehicle battery sectors and support local energy security by realigning supply chains to our trusted partners.

We have collectively arrived at a critical moment in addressing the climate crisis.  At COP 27 countries expressed their will to follow through on their commitments to transition to cleaner energy.  While meeting these objectives is achievable, there is a lot more work to do.

We know that high electricity prices are impeding Central America’s economic development.  Due to its high dependence on imported fossil fuels, Central America’s residents pay nearly twice as much for electricity as their neighbors in South America.  In addition, the region has yet to fully realize the benefits of its ambitious regional power grid and electricity market.

Discussions like the one we are having today make clear that our ability to meet our ambitious climate goals is strengthened when we work together across borders as CABEI has done.

Regional electricity market integration, power sector decarbonization, rural electrification, and increased power sector resilience remain opportunities to advance the U.S. economic development strategy and our clean energy goals Central America.

The State Department’s Power Sector Programs are providing support to Central American regulators as they develop rules for renewable energy and electric vehicle integration, including support on distributed generation and battery energy storage regulatory frameworks, as well as technical assistance to green operators to enhance viable integration of existing wind and solar.

For years the United States has supported Central America’s power sector development and efforts to expand power trade over regional SIEPAC network.  Our power sector programs advise on national transmission upgrades to increase regional transfer capacity.  We also advise on reserve requirements and advising on primary frequency control regulations given increased renewable energy to enhance grid stability.

Our recommendations to the regional system operator have helped reduce technical disturbances on the SIEPAC network from 30 to 40 incidents in 2015 to under 5 this year.

The work that the Central American Bank for Economic Integration is doing in the region cannot be more timely and will synergize with initiatives individual countries are pursuing, including what the United States is doing through IRA and our infrastructure bill.

We applaud the bank’s joint commitment to the Inter-American Development Bank, the Latin American Development Bank, and the Caribbean Development Bank at the Summit of the Americas to mobilize $50 billion in climate and green financing in 2026.   This critically needed financing will help countries recover from natural disasters, reduce climate-related migration, and secure a brighter future for all of our people.

In support of this aim, the United States seeks to work with all willing Inter-American Development Bank stakeholders to reform the bank to further drive climate ambition as well as social inclusion and private sector development with the possibility of future capitalization.

While all the world’s governments are taking unprecedented steps to address the climate crisis, soliciting further perspectives from the business community, civil society, and the public sector will be critical to advancing these priorities in the future.

I want to emphasize this again: Governments make plans and articulate commitments, but it will be businesses and citizens like those represented here today that will ensure that these plans and concepts become reality.  I encourage you all to stay interested and engaged on this topic.  Plug in and keep an eye on future opportunities in the electric mobility sector.  It’s an incredibly exciting time on these issues.  I’m very proud of the leadership the United States is exercising, and I know that the State Department team is deeply committed to moving ahead jointly with our allies and partners around the world.

Thank you again for the invitation to speak today.  I wish you all the most successful conference.

U.S. Department of State

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