Public tenders reshape Central America and Caribbean energy markets

Latin America is within striking distance of its RELAC target to source 80% of its electricity from renewables by the end of the decade. As of 2025, 71% of the region’s power already comes from clean sources, with most countries adding 10% to 15% more solar annually.

Public tenders seem to be the tool of choice for pushing the region through the final stretch. Designed to lay out contract terms upfront, these procurement rounds inject the transparency that’s often missing from bilateral deals or unsolicited proposals, encouraging the private sector to take on large-scale projects.

In this blog, we look at some of the latest auctions by Central American and Caribbean governments, particularly in Guatemala, Honduras, and the Dominican Republic.

Guatemala rolls out its largest power tender yet

Open to both domestic and international bidders, Guatemala’s PEG‑5 electricity tender has become the most competitive generation auction in the country’s history. The process sought to contract 1,400 MW of firm capacity, yet attracted 51 formal bids totalling around 4,700 MW, more than tripling the required volume.

Preliminary figures indicate that over 2,000 MW of the proposals correspond to solar projects, including configurations combined with storage, alongside thermal and other renewable technologies. The tender, which will award 15‑year supply contracts starting between 2030 and 2033, is expected to mobilise more than USD 3.5–3.7 billion in investment, reinforcing Guatemala’s long‑term energy planning and security of supply for regulated consumers served by EEGSA and Energuate. Economic bids will be evaluated through a reverse auction scheduled for 25 March 2026, with final awards planned for 16 April 2026, a level of competitive pressure not seen in previous PEG rounds. 

The scale and composition of the offers highlight Guatemala’s growing appeal for utility‑scale solar and hybrid projects, positioning the country as one of Central America’s most dynamic renewable markets. While solar capacity in Guatemala remains modest in global terms, the strong response to PEG‑5 signals accelerating momentum, particularly for projects capable of delivering firm or flexible supply aligned with system needs. The unprecedented oversubscription is expected to drive sharper pricing discipline, encourage technological diversification, and set new benchmarks for future auctions as the country prepares for rising demand beyond 2030.

A notable project is the new 112-hectare El Carrizo solar farm in San José, Escuintla (now the country’s largest), which came online in September this year. The project has more than 137,000 modules and will generate 157 GWh a year under a ten-year PPA. Developer Ecoener has invested roughly EUR 116 million (USD 135 million) in Guatemala since 2024, funding both the El Carrizo and Yolanda solar projects, as well as its 14.2 MW Las Fuentes hydro plant.

Honduras prepares to reset its generation mix

Honduras already has around 600 MW of installed solar capacity, most of it clustered in the southern zones, where Pavana and Choluteca (among other successful projects) have been operating for years. Over the past decade, Honduras has seen electricity demand rise roughly 4% each year, stretching the grid in cities and industrial hubs. ENEE expects that trend to continue.

It is preparing to relaunch a 1,500 MW generation tender as part of a broader institutional reset. The process, originally launched by the previous administration and later frozen amid political instability, is now being repositioned as a cornerstone of the government’s 2026–2030 energy roadmap, which prioritises financial sustainability, infrastructure expansion, renewable deployment, and system reliability. The tender is expected to award long‑term contracts covering renewable and thermal technologies, as well as energy storage and flexibility solutions, with at least 500 MW earmarked for clean sources such as solar and wind to diversify the power mix and reduce reliance on costly fossil fuels. More than ten companies have already acquired the tender documents, signalling renewed investor interest following months of uncertainty.

The relaunch comes against a backdrop of rising system stress and long‑term demand growth, which has exposed weaknesses in grid capacity and supply security. Under the plan, Honduras aims to raise renewables to 80% of the electricity mix by 2027, cut system losses by 40%, and double installed clean capacity, with a strong focus on solar, wind, and biomass.

The tender is therefore positioned not only as a capacity-expansion mechanism, but also as a tool to stabilise ENEE’s finances, strengthen dispatchability, and prevent future supply disruptions. Authorities have indicated that ensuring technical transparency, regulatory certainty, and financial viability will be critical to restoring confidence and avoiding the participation gaps that limited earlier procurement rounds.

No batteries, no deal in the Dominican Republic

The Dominican Republic is one of the more proactive clean energy builders in Latin America. It took just three years for it to double its installed capacity, reaching 1,126 MW by the end of 2023 and 1,500 MW in 2024, and it hopes to reach around 2,800 MW by 2028.

Policymakers now want to convert all that buildout into tangible generation gains by turning clean capacity into a round-the-clock supply.

Subsequently, it has launched its most ambitious renewable tender to date, offering up to 600 MW of solar and wind capacity and a level of competition that far exceeds expectations. The auction has attracted 32 projects totalling nearly 3,000 MW, almost five times the available capacity, making it the most competitive renewable procurement process in the country’s history. All bids are required to include battery energy storage, marking a structural shift in how new clean generation is integrated into the grid. 

The storage mandate addresses system constraints that have limited the effective use of renewable generation in recent years. According to regulators, grid congestion and limited flexibility have forced renewable curtailment and increased reliance on thermal generation, raising system costs despite the availability of lower‑cost clean energy.

Under the new rules, every awarded project must incorporate BESS with a minimum of four hours of storage, connected at the same interconnection point as the generation asset and capable of providing services such as ramp control, frequency regulation, and black‑start support. The objective is to transform intermittent capacity into a firm, system‑supporting supply.

The tender is being coordinated by the Council of State‑Owned Distribution Companies (CUED) and will result in long‑term, dollar‑denominated power purchase agreements, with battery services bundled into a single contract to streamline procurement and reduce administrative risk. The overwhelming response reflects the Dominican Republic’s rapid renewable build‑out, which has doubled installed clean capacity in recent years and continues to expand at pace. Policymakers now aim to convert that growth into round‑the‑clock, dispatchable clean generation, ensuring that rising renewable penetration translates into tangible gains in system reliability and consumer benefits.

​Panama: A multi‑year auction roadmap to rebalance the power system

Panama has unveiled one of the most structured and forward‑looking procurement strategies in Central America, announcing a five‑auction roadmap that will contract more than 2,700 MW of new capacity between 2025 and 2028. The plan, presented by the National Energy Secretariat, combines 1,420 MW of firm energy (MWEq) with 1,335 MW of newly installed capacity, and introduces a level of long‑term visibility that has been largely absent from previous procurement cycles. Contracts awarded under the scheme will extend supply commitments through to 2033, giving developers clearer timelines to advance financing and construction.

Rather than bundling all technologies into a single call, Panama’s roadmap staggers auctions by technology and system need. The first process focuses on firm energy from new hydro and wind projects, with supply starting in 2029, while a solar‑only auction is scheduled for 2026, deliberately timed to avoid excessive daytime generation that could strain the system. Later rounds will include additional hydro projects, firm backup capacity, and the reconversion of existing thermal plants to lower‑emission fuels, allowing the country to preserve dispatchability while progressing toward decarbonisation. 

The underlying objective is system balance rather than rapid capacity expansion. By sequencing technologies and clearly signalling future opportunities, policymakers aim to reduce price volatility, strengthen energy security, and attract higher‑quality bids across renewables and firm capacity alike. The approach positions Panama as a regional outlier: not simply adding clean megawatts, but planning their integration years in advance, with auctions designed to reflect real grid constraints and long‑term demand growth rather than short‑term price competition alone. 

Creating competitive bids with RatedPower

If you are competing for clean energy contracts in the region, RatedPower can help your solar development team adapt more quickly to these new requirements. As public tenders across Central America and the Caribbean become more prescriptive, defining firm energy requirements, mandatory storage, and stricter grid‑integration criteria, developers and EPCs are under pressure to submit technically robust, system-aligned bids from the outset.

In markets like Guatemala, where hybrid solar‑plus‑storage projects are competing in oversubscribed auctions, Honduras, where new capacity must balance reliability with financial sustainability, the Dominican Republic, where four‑hour BESS is now a prerequisite, and Panama, where auction design is closely tied to long‑term system planning, RatedPower helps teams adapt faster and bid with confidence.

The platform enables users to simulate PV and BESS configurations together, test AC‑ and DC‑coupled storage strategies, account for grid constraints and curtailment risk, and export standardized technical documentation for tenders, all within a single workflow. By allowing teams to compare layouts, storage sizing, and performance assumptions in minutes rather than weeks, RatedPower supports more competitive bids, stronger technical transparency, and projects that are better aligned with the evolving requirements of system‑led procurement frameworks across the region.