Guatemala, Panama, and the Dominican Republic are moving forward with new tenders that incorporate or prioritize battery energy storage systems , consolidating BESS as one of the main drivers of electricity investment in Central America and the Caribbean.
The coincidence of these processes supports the interpretation of Ricardo Palacios , Key Account Manager at Sungrow , who warned that decisions made in one market begin to directly influence the planning of neighboring countries.
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“I believe that the entire Central American and Caribbean region is experiencing strong growth,” the executive stated during an exclusive interview conducted at the Future Energy Summit Guatemala.
The three countries start from different regulatory conditions, but face a common need: to integrate more renewable capacity without compromising the flexibility, firm power or stability of their electrical systems.
Guatemala is looking to contract around 300 MW of additional capacity, Panama is preparing processes that place storage among its priorities, and the Dominican Republic is planning tenders to complete renewable capacity and incorporate batteries into existing solar parks.
For Sungrow, the incorporation of batteries ceased to be limited to coupling with photovoltaic power plants and began to respond to broader operational requirements.
“The integration with the photovoltaic sector is already a reality,” Palacios noted.
Guatemala consolidates hybrid projects
Guatemala marked a turning point with PEG-5 , which awarded 1258 MW distributed among 57 projects. Around 73% of the capacity corresponds to renewable technologies, with a significant presence of hybrid solar with battery storage proposals.
The average single-unit price was $101 per MWh , below current contract values, and demonstrated the competitiveness of these solutions within long-term processes.
The outcome also changed investment criteria. New developments are no longer structured solely to deliver energy, but to combine generation, power, and management capacity.
Palacios stated that Guatemalan contractors already face concrete needs to integrate storage into their projects.
“On the Guatemalan side, indeed all those who have already been awarded these projects are in dire need,” said the Sungrow representative.
The private sector agrees that the Guatemalan market will evolve towards hybrid projects capable of providing energy, power and flexibility .
In turn, the National Electric Energy Commission highlighted that storage has ceased to be a technological differentiator and has become an attribute associated with the reliability and stability of the system.
Guatemala also approved the terms for a new tender intended to cover the 300 MW that remained pending after PEG-5.
During FES Guatemala, the then Minister of Energy and Mines, Victor Hugo Ventura, anticipated that the Government would move forward with a new process to contract approximately 300 MW of firm power .
The expansion plan also includes grid infrastructure. The president of the National Electricity Commission, Claudia Marcela Peláez, anticipated that the development of PET-4 will be a priority to avoid bottlenecks and allow the connection of the allocated capacity.
The new renewable generation, storage, and transmission must advance in a coordinated manner , because batteries can manage delivery but do not replace the infrastructure needed to connect and transport production.
In this scenario, Sungrow receives inquiries about sizing, warranties, integration, and operational functions of the systems.
“It is up to us as product providers to talk to the developers and tell them how we can meet their needs,” Palacios explained.
Panama places BESS among its new priorities
Panama also incorporated storage into its contracting roadmap , following a series of tenders that revived large-scale renewable investment.
The LPI ETESA 01-25 awarded long-term contracts with an average price of $23.86 per MWh , one of the lowest values recorded in the region.
The process was dominated by wind power, which displaced solar power due to its capacity factors and generation profile.
Subsequently, the LPI ETESA 01-26 awarded 22.6 TWh of renewable energy through contracts of up to 20 years and reached an average price of $33.7 per MWh, below the reference value.
Although batteries were not mandatory in those processes, the fall in generation prices and the growing renewable penetration turned BESS into the next frontier of the Panamanian market .
The country has reaffirmed two tenders for 2027, with storage systems as a new priority. Furthermore, its planning includes four tenders between 2026 and 2028 to reduce exposure to the spot market and ensure future supply.
Palacios considered that the Dominican experience spurred the Panamanian debate on the need to incorporate batteries.
“The Dominican Republic experience also opened Panama’s eyes to the need for storage,” said the Key Account Manager of Sungrow.
The executive recalled that the mention of BESS during the previous stages of a Panamanian tender generated numerous inquiries among the participants.
“There was a commotion in the room because everyone was saying, 'But wait, nobody had told us anything about it, how is it going to work? What do I have to do?'” Palacios recounted.
The reaction showed that interest in technology is advancing faster than the technical and contractual knowledge needed to integrate it .
Developers must evaluate the duration, power, cycles, degradation, availability, warranties, and services that each system will provide.
“There were so many questions at the time, but you could see people's eagerness to know what they ultimately wanted,” he added.
The Panamanian roadmap anticipates a growing share of batteries by 2029, both to facilitate the incorporation of renewables and to improve grid reliability and demand management.
Palacios pointed out that the proximity between Central American markets accelerates the transfer of experiences , despite the regulatory and structural fragmentation of the region.
“This interaction between a market that, while certainly very fragmented, is very close, allows neighbors to hear what the person next door and the person on the other side are doing,” the executive said.
Dominican Republic brings forward mandatory
The Dominican Republic appears as one of the most advanced markets in Latin America in the mandatory incorporation of BESS within renewable energy tenders.
The EDES-LPI-01-2025 received bids for 1655 MWp against a demand of 600 MW , reflecting a strong oversupply and high interest from developers.
The process awarded 325.69 MW of new renewable capacity, accompanied by storage systems equivalent to 50% of the contracted power .
Palacios emphasized that the Caribbean country advanced in that direction before other markets in the region.
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“The Dominican Republic, as a country in the Central American and Caribbean region, has already taken a step forward in that direction as well,” he said.
Following the award, the Electricity Distribution Companies moved forward with signing the power purchase agreements, which consolidated a new generation of solar projects with batteries.
“There was also a tender this year where some people were awarded contracts, and there it is mandatory to have 100% compatibility with storage systems,” the Sungrow representative highlighted.
The country is also preparing a new tender to contract the 300 MW that were left unawarded , along with another process aimed at incorporating 200 MW of BESS into operational solar parks.
This latter approach would allow for increased firm capacity and accelerated battery deployment without relying exclusively on new greenfield projects.
During FES Caribe, Dominican authorities also anticipated processes to incorporate more than 800 MWh of storage in the short term and a projection of close to 2000 MW of BESS capacity during the next few years.
The Dominican Republic is moving towards combining tenders for new hybrid projects with retrofit schemes in existing assets , a strategy that expands the potential market for manufacturers, integrators and service providers.
“Then you start to realize that this appetite is growing,” Palacios noted.
The executive acknowledged that the mandatory requirement may generate uncertainty during the initial stages, especially among players who have not yet incorporated batteries into their financial and operational models.
“At first, it might come as a shock to the developer, but when they really start to get their hands on it and understand how things are working, they realize that the wolf isn't so fierce,” he said.
The requirements go beyond arbitration
Market expansion is also changing customers' technical requirements. Initial requests focused on storing electricity and delivering it during peak hours.
“Originally it was like: 'We have the storage component to develop a project, how do we make it deliver the energy at an arbitrage opportunity?'” Palacios explained.
Once the systems are operational, the owners begin to incorporate new features and services.
“Once those systems were already installed, you start to encounter: 'I need it to have the possibility of Black Start',” the executive explained.
The Black Start allows you to contribute to the restoration of a central office or part of the network without initially depending on an external power source.
The expansion of functionalities also raises the need to retrofit installations designed with simpler configurations .
“Everyone starts from the simplest part, but then, when they see the whole range of possibilities that a BESS system integrates, it grows a lot,” he noted.
In addition to arbitration and Black Start, batteries can provide power control, frequency support, voltage regulation, backup and congestion management, depending on the regulations and characteristics of each electrical system.
Defining the use case is crucial for establishing the power, duration, operating strategy, guarantees, and number of cycles of the project.
Demand extends to all segments
Palacios's business at Sungrow is mainly focused on utility-scale projects , linked to large power plants and competitive procurement processes.
“The clients we see are large-scale project development clients with different needs,” he explained.
The company also identifies opportunities in the commercial and industrial segments.
Sungrow has a regional division based in Brazil that is making progress in incorporating local staff to meet the demand from other countries.
“The appetite is noticeable from a utility-scale point of view, from a commercial and industrial point of view,” Palacios said.
The executive also detected interest in the residential market, associated with photovoltaic self-consumption, backup and continuity of supply.
“At the time, the first ones who want to make decisions are also the people in their homes; so from a residential point of view, it is also seen,” he added.
Sungrow did not anticipate a specific percentage of market share, although he expects the volume of opportunities to grow as new processes are awarded.
“I don’t dare to give a specific number,” Palacios acknowledged when asked about market share expectations.
The impact of tax changes in China
The acceleration of regional tenders coincides with tax changes in China that may influence the export price of batteries .
Palacios explained that the process began earlier in the photovoltaic industry. In the case of solar panels, the tax refund decreased from 14% to 9% and subsequently to 0%.
For batteries, according to the executive, 3% was initially withdrawn, then an additional 6% will be applied, and the scheme will reach 0% from January 1, 2027 .
“Now it’s an additional 6%, but next year it will be 0%,” he said.
Sungrow does not expect the change to halt ongoing projects, although developers will need to update their economic assessments.
“I don’t think there will be a slowdown. I think, rather, that the projects that are currently underway will continue,” Palacios projected.
Some players may bring forward purchasing decisions, while others will incorporate the new cost into their financial models and contract negotiations.
“Obviously there will be an economic impact, and what will have to be done is a new run of numbers to be able to evaluate that extra cost that will be part of the process,” he explained.
The final price of batteries will not depend solely on tax changes. Raw materials, components, and industrial costs fluctuate, which can either offset or exacerbate the tax impact.
“Right now they may be on the rise, but in the future we will see another drop,” the executive warned.
Price trends will be one of the factors that participants will have to consider in the tenders announced by Guatemala, Panama, and the Dominican Republic.
All three countries are making storage a central planning tool , albeit through different schemes: hybrid projects in Guatemala, new procurement priorities in Panama, and mandatory requirements and retrofitting in the Dominican Republic.
For Sungrow, this series of announcements confirms that the regional discussion is no longer limited to how much renewable energy can be installed. The new challenge lies in reliably storing, managing, and delivering that production.