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Patterns of Economic Development

Energy

Petroleum and natural gas are the principal sources of energy in South America. More primitive sources, such as firewood and charcoal, however, are used widely in industry, sometimes in making iron and steel or in refining sugar. Dependence on petroleum and natural gas is of concern because only Colombia and Venezuela are self-sufficient in petroleum. Distributional needs are met with fairly extensive petroleum and gas pipeline systems in Argentina, Venezuela, and Colombia and lesser systems elsewhere. Nevertheless, most pipeline systems in South America transport crude oil and gas to export terminals, rather than to internal markets. Coal, available in relatively small reserves, was important to the early development of rail and water transportation and industry in Chile, Argentina, Brazil, and Colombia, but has long been superseded in importance as an energy source. Alcohol derived from sugarcane is an important automotive fuel in Brazil. Hydroelectric power has become a viable alternative to thermal-electric power only since the 1950s. The development of hydroelectric power began in Brazil, Chile, and Colombia; installed hydroelectric capacities now constitute more than 60 percent of electricity-producing capacity in Paraguay, Brazil, Uruguay, Colombia, and Bolivia. Hydroelectric power is also important in Peru, Chile, Ecuador, Suriname, and Argentina, where installed hydroelectricity-generating capacity accounts for more than 40 percent of all generating capacity. Hydroelectric development ranges from small installations used by provincial towns to the enormous facilities built in the middle and upper Parana Basin and the upper and lower reaches of the Sao Francisco River.

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