Panama floats 500MW RE plus energy storage tender; first in Central America

Central American nation Panama has recently announced its first-ever renewable energy and energy storage bidding auctions to meet the growing demand for electricity and enhance grid reliability in the country. 

The country's National Secretary of Energy and the state-owned power transmission company Empresa de Transmisión Eléctrica SA (ETESA) are seeking 500 MW of renewables and energy storage capacity, for which the bidding will be held in the second quarter of this year following a formal publication of application in February. 

According to media reports, offtake agreements with the winning bidders will be undertaken for three different types of projects, namely renewables (new or existing) with energy storage systems, clean energy generation from new or existing projects, or firm power coupled with energy.

While fresh projects will have a 20-year power purchase agreement, the existing projects will be approved a duration of up to 10 years under the scheme. Winning bidders may have to get their existing projects operational by the start of September 2026, and new projects commissioned before January 2029. 

The Panama government is targeting a guaranteed supply of clean energy in the national grid to the users at affordable electricity prices, while also generating green jobs and streamline investments in this emerging space.

Being the first country in the region to include energy storage in renewable energy development, the government believes that energy storage is of prime importance to its goal of contributing 5 percent of the total demand capacity by 2030 with energy storage.

Panama is considered as a potential market for solar PV investments in Central America, thanks to attractive fiscal incentives and taxation exemptions and stable governance in the state, coupled with the fact that the country uses US Dollar as its currency.