Panama's government, through the National Energy Secretariat, has launched a short-term power and energy procurement tender aimed at securing a stable electricity supply for the 2025-2030 period while protecting consumers from unexpected cost increases.
The resolution to initiate the tender was released on October 8 and establishes a public bidding process that must be completed by December 10, 2024. Power generators can participate in two categories: one for power-only contracts, which is open to all technologies regardless of their source, and another specifically for renewable energy contracts, including hydro, wind, solar, and biomass power.
The rules for the first category stipulate that power plants must be available for dispatch or in commercial operation by the date the tenders are launched. In the renewables category, plants can be in a trial stage, available for dispatch, or already in commercial operation.
Contracts will have a maximum duration of 60 months, with the supply period commencing on March 1, 2025, and concluding on the last day of February 2030. The government has established maximum prices for power (in USD/kW) and energy (in USD/MWh) for each of the 60 months.
Details regarding power and energy requirements, expressed in MW and MW-equivalent respectively, as well as the maximum prices for both categories, are available in the resolution MIPRE-2024-0033084 (in Spanish) here.
The state-owned electricity transmission company ETESA is responsible for executing the tender process, evaluating bids, and awarding contracts.
Electricity distribution companies in Panama, particularly ENSA, will be directly affected by this tender as they face energy and power shortages. According to the energy secretariat, this situation exposes end consumers to volatile market prices, which could lead to significant rate increases similar to those anticipated for the latter half of this year. To mitigate this impact and stabilize electricity rates, the government has decided to defer these increases.
