Compared with other countries in Latin America, Costa Rica is doing great. Its policies align with what is needed to limit climate warming to 1.5°C, although its carbon reduction targets need some improvement.
Coming into COP26, Costa Rica is in an excellent position. When COP25 finished, the country was one of the 36 that adhered to the San Jose principles, which aim to ensure that “environmental integrity, robust accounting rules, the avoidance of double counting and ambition” determine the regulations around carbon markets.
The country has a National Decarbonisation Plan, which is more ambitious than its Paris Agreement targets for 2030 and 2050; the government presented an updated Nationally Determined Contribution (NDC) to global emissions reductions in December 2020, and has had ambitious climate change goals for the past ten years. If it follows its current NDC pathway, the government will achieve carbon neutrality in 2085. However, if it implemented all the policies mentioned in its National Decarbonisation plan, it could do so by 2050. Which is what the country’s government wants to do.
In 2019, the current government presented a ten-step route to create a development model based on CO2 emissions reduction, digitalisation and decentralisation of energy production.
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It is not the first time Costa Rica has led green change. The central American country, known for not having had an army since 1949, rewrote its constitution in 1994 to include the right of all its citizens to a healthy environment. Also, a quarter of its territory is currently a natural reserve, and it is the only tropical country in the world that has effectively reduced deforestation.
Currently, Costa Rica produces almost all its electricity from renewable sources (80% by hydroelectric power), and every year it establishes a new record in clean energy usage.
The government also has a three-stage policy package, which aims to phase out fossil fuels by 2050.
This package goes hand-in-hand with eight strategies to accelerate change, including digitalisation, the just transition of workers affected by decarbonisation, and strategies for financing that transition.
Almost 22% of Costa Rica’s revenue comes from fossil fuel taxes
The major hurdle the country must tackle if it wants to continue its green path is clear: transport.
In 2016, there were more new cars registered than new babies in Costa Rica. More than 60% of Costa Rica’s population travels by diesel buses or trains, a high number. The government wants to make a drastic transition towards electric vehicles but this is complicated since almost 22% of its income comes from fossil fuel taxes.
The country has also failed to provide explicit and transparent assumptions on several critical elements of how it will achieve its NDC. It has provided no information on establishing a periodic reviewing cycle of its climate measures and interim targets.
If the country manages to adjust its NDC, with realistic expectations, to its National Decarbonisation plan, it could be the first in Latin America to take significant steps towards net-zero. It is, however, too soon for a victory chant, although it has paved the way for other countries in the region to adjust their commitments and acquire more ambitious ones.