The profitable greening of Panamas power production

AIDED BY plummeting prices for equipment to produce solar power, Panama is jumping on the environmentally friendly green energy bandwagon which has the potential to become a gravy train as the country’s demand for more power increases and government seeks to avoid political minefields, like the Baro Blanco hydroelectric project.

Five years ago on to create one megawatt of solar power needed an investment of $5million.
Today technological advances and increased competition from Asian and European manufacturers of solar devices has dropped the cost to between $1.3 million and $1.5 million.
The 70% reduction in installation cost per MW has stimulated the interest of investors to bet on this technology in Panama.
Already operating four solar power plants are generating of 13.46 MW, but this number will quickly increase. in a short term.
In the two years of the enactment of Law 37 of June 10, 2013 that encourages solar generation in the country, the National Authority of Public Services (ASEP) has delivered 19 licenses for photovoltaic power plants with a combined capacity of 405 MW.
These projects are in the final design stage or under construction, with nine of them the province of Cocle and six in Chiriqui. The rest is divided between the provinces of Herrera, Los Santos, Panama and Veraguas.
Additionally the ASEP is holding 55 provisional licenses that still need to complete all the requirements under the law, such as the approval of the environmental impact assessment (EIA), financing and generation contract.
If all 74 solar plants are built they are will generate 211 MW and represent an investment of $1.816 billion.
Rodrigo Rodriguez, national director of electricity for ASEP said that during the last years they have taken actions to reduce speculation in the energy sector reports La Prensa.
He said that 30% of the investment must be provided by the investor who obtains the license, along with presenting a letter of intent from the supplier of the equipment to be installed in the plant, and documentation to ensure that they will rent or buy the land where the generator will operate.
He said that since last year they are also demanding a construction bond, which will be 10% of the total investment. “If the project does not meet all the requirements established by law, the State will pull the rug”, he said
In addition to encouraging the installation of solar generators, Law 37 of June 10, 2013 also allows businesses and individuals to install solar panels to generate their own electricity. This system allows companies and individuals to sell to the distributors the excess of energy that they don’t use during the day.