Sep. 28, 2019
IN CENTRAL AMERICA, Costa Rica has long been known as a leader in sustainable development and renewable energy, with almost 100% of all electricity needs provided by green technologies. Now, its neighbor Panama is following its example with an ambitious energy project that aims to source 70% of the nation's power needs from renewables by 2050.
Known as the National Energy Plan, state leaders in Panama have been busy updating regulatory frameworks and the country's electricity grid to foster a green energy revolution that will ensure sustainable development for decades to come. In the recent Renewables Readiness Assessment Panama report released by the International Renewable Energy Agency (IRENA), officials recommended upgrading the nation's regulation of power purchase agreements (PPAs) to enable the connection of more solar and wind power facilities to the national grid.
“Favorable legislation and attractive legal frameworks can boost the deployment of renewable energy, which in turn can contribute to low-carbon economic growth and improve energy security," said IRENA Director-General Adnan Z. Amin. “Panama's abundant potential for renewable energy resources offers the country the opportunity to cost-effectively meet its long-term energy needs and underpin its transition to a sustainable energy future.
The report was well received by government officials in Panama City, and the rising interest in green technologies has caught the attention of international renewable energy companies, which have been organizing expos such as RECAM Week to showcase their products. According to IRENA, Panama has significant potential to develop a myriad of renewables, including hydropower, wind, solar, geothermal, biomass, and tidal energy along its Pacific and Caribbean coastlines.
Latin American companies such as OTEPI are already stepping up to the plate to deliver new technologies in the underdeveloped renewable energy market, partnering with UGE International Ltd., a global leader in distributed renewable energy solutions for businesses. Together, the two companies will design and install solar systems for all of Panama's mega self-storage facilities that will offset over 30% of the buildings' electricity bills.
German renewable energy developer PNE has also acquired five wind farm projects in Panama, where the company will establish a new headquarters to serve Central and Latin American markets. The electricity generated by the wind farms, which are in an advanced stage of development, will be marketed through direct PPAs under green energy-friendly regulations passed by the Panamanian government.
“In Latin America, we see great potential for the expansion of renewable energies—both in wind energy and in photovoltaics," PNE Chief Executive Markus Lesser said. “Therefore, this step shows the consistent implementation of our strategy in a promising region."
At the end of 2016, Panama had a wind energy capacity of 270MW and a solar energy capacity of 90MW, according to IRENA data. Former President Juan Carlos Varela had been proactive in supporting the National Energy Plan, inaugurating renewable energy projects throughout the country while noting their capability of creating jobs for a 21st-century green economy.
On February 1, 2019, Varela was joined by former US President Bill Clinton to inaugurate the 40-MW IKAKOS solar complex in the city of David in Chiriquí province. The USD48-million complex, which consists of nearly 140,000 photovoltaic panels, will be capable of generating 85GWh annually, the equivalent of energy consumed by 22,000 Panamanian households. Together with the 215-MW Laudato Si wind farm that came online in Penonomé in 2018, both projects have rapidly expanded Panama's renewable capacity, and more energy developments are set to open in 2019.
Meanwhile, green transportation options are being tested by MiBus, the mass transportation authority in Panama City. For a period of six months in 2019, MiBus will run a pilot project to evaluate an electric bus fleet produced by Build Your Dreams (BYD) company based in Shenzhen and Los Angeles. At a length of 12m, the vehicles are about the same size as standard city buses; only they run on rechargeable batteries and produce zero emissions.
Through a combination of smart electrical grid planning, expanded renewable energy plants and green urban transportation options, Panama will soon become a green technology leader in Central America