HEATING UP

Panama 2018 | GREEN ECONOMY | REVIEW

While renewable energy already plays a crucial role in the country's energy mix, new fields such as wind and solar are rapidly attracting investment and building up the entire industry.

The environment and sustainability have, in recent years, been claiming a more prominent role in Panama's national strategy and political agenda. The country recently advanced its National Environmental Authority (ANAM) to ministerial status, allowing the government to take more streamlined action in combating deforestation, biodiversity, climate change mitigation and adaption, and promotion of green technologies.

In June 2018, Panama's Global Bank received a long-term credit line for green loans worth USD30 million as part of a new partnership with the Global Climate Partnership Fund (GCPF). GCPF works to fund projects related to energy efficiency and renewable energy projects directed at homes and small and medium enterprises. The partnership between Global Bank and GCPF stipulates that the bank will create and grant green loans for corporate green building, in addition to investing in small- and medium-sized energy projects and projects to increase energy efficiency in both industrial and agricultural sectors. Global Bank is already consulting experts and identifying important projects throughout the country and measuring their viability. GCPF will provide technical assistance to both the bank, as well as clients taking on green projects.

For some time, Panama has relied on hydroelectric and thermal energy sources for its matrix, and hydro accounts for over 48% of the country's consumed energy. Though the ratio is already high, the government is looking for ways to further increase the use of other renewable sources. In late 2015, Panama opened Central America's largest wind farm, the Penonomé wind farm, located in the central province of Coclé. The USD570-million project built nearly 110 wind turbines, enough to produce energy for some 100,000 families. The Penonomé project has yet to reach its fourth stage, after which the farm will produce approximately 337MW of energy.

In June 2018, the Denmark-based Vestas announced it will produce 20 wind turbines for Panama's Toabré wind farm. The first phase began construction on May 11, with Spanish Audax Renovables SA breaking ground. With a total investment of over USD150 million, Toabré wind farm is expected to produce 66MW of power when the first phase is completed.

Solar energy currently represents only 1% of Panama's energy matrix. However, the popularity of solar is rapidly rising and the technology is sure to find numerous uses throughout the country. Though young, the solar industry has received special support from the government in recent years, including legislation granting fiscal incentives and specialized tenders for solar projects. In mountainous and densely forested terrain, solar can provide power in remote villages where other energy infrastructure cannot reach.
Panama is home to one of the largest rainforests outside of the Amazon in the western hemisphere, which is why the country is gifted with more than 500 rivers, many of which have played a significant role in developing the country's hydropower infrastructure.

With hydropower constituting such an important part of the country's energy make up, local industries have formed around the maintenance and protection of water. TBY recently sat down with Carolina Blanco, the CEO of Ambitek Services, a Panama-based company specializing in water technology and cleaning solutions, to get an understanding of how the company is building Panama's green economy. “Consulting on the diagnosis of water and the optimization of plants is the most successful part of the company,” Blanco said. “In Panama, there is a purchase-sale system. Everything works well for the first few months; however, when the plants begin to have problems, either the company has disappeared or it is necessary to bring in someone from the outside, which involves high costs. We diagnose the problems and tune up the treatment plants, and if the client wants it, we operate their plants. We are currently operating the Barú brewery sludge plant, and we were with Minera Panama for six months tuning up their domestic residual water plants. In Panama, a great deal has been done.”