Panama to include storage in energy auctions

In an exclusive interview with pv magazine, Panamanian Energy Secretary Juan Manuel Urriola said the government will open the electricity market to private investment and revise regulations to enable energy storage. Urriola also emphasized the importance of long-term planning and transparent bidding to attract developers.

From pv magazine LatAm

Panama has no specific targets for installed PV capacity, said Panamanian Energy Secretary Juan Manuel Urriola.

“Our energy goals are comprehensive and aim to meet demand in a safe, reliable, and competitive manner,” he told pv magazine, noting that the country aims for at least 20% of national consumption to come from renewable sources such as solar and wind by 2030. The goal rises to a 70% share of renewables in the electricity mix by 2050.

Urriola said the National Energy Secretariat supports private investment in new solar parks through regulatory instruments and tax benefits. He pointed to Law 45 of 2004, which exempts tariffs for solar equipment and provides income tax benefits, and Law 37 of 2013, amended in 2023, which allows accelerated depreciation and tax credits of up to 5% of the investment value.

“We greatly respect the contractual freedom that exists with investors coming to Panama through tenders, contracts, or concessions,” he said. “The rules of the game for them must be clear and with certainty that there is a rule of law.”

The secretary said Panama plans to promote distributed PV systems, especially in rural or remote areas.

“These projects are part of the National Electrification Plan and include individual solutions and minigrids to expand energy access in isolated communities,” he said.

He added that solar generation has grown steadily in recent years. Planning for grid expansion is handled by the Electric Transmission Company (ETESA), which reviews the plan annually to ensure new generation capacity is integrated effectively.

Panama is preparing new short- and long-term tenders for capacity and energy procurement. Studies are underway to determine the reserved quota for solar energy in future auctions.

“The predictability in the tender calendar responds to the demands of investors and distribution companies,” Urriola said. On energy storage, he said it will not be mandatory in auctions but may be included if technically and economically viable. “Storage will help improve the quality of service and provide complementary services in the transmission and distribution network.”

Urriola also noted that minigrids in isolated regions currently combine solar, thermal generation, and batteries to deliver sustainable energy to communities without grid access.

He said Panama’s regulatory framework allows renewable projects to connect and operate without major barriers. He emphasized the need for transparency and accountability.

“Improvements in the sector must be self-financed through long-term investments,” he said, adding that Panama seeks international cooperation to expand energy access in remote areas through individual solar systems and minigrids.

Panama deployed 143.4 MW of new solar in 2024, increasing its total installed PV capacity to 695.55 MW by year-end.

Total installed capacity in Panama reached 5,045.09 MW in 2024, including 2,165.97 MW from thermal power (42.93%), 1,847.57 MW from hydropower (36.62%), 336 MW from wind (6.66%), and the newly added PV capacity.