The Dominican Republic is making progress in preparing four contracting processes for power generation and storage , with the aim of strengthening the electricity supply and anticipating the longer timeframes currently required for the execution of energy projects.
This was stated by Joel Santos, Minister of Energy and Mines , during FES Government & Investment , held within the framework of the XI Energy Week.
The official explained that difficulties in international supply chains are extending delivery times for essential equipment, such as turbines, forcing them to project electricity needs with broader horizons.
"We are accelerating the bidding processes not only to ensure the energy supply needs of the short and medium term, but also thinking ahead to what I call the 2030s," he said.
In that context, Santos specified that the Government is working on a call for 200 MW of storage for existing generation projects , whose launch is expected in the short term.
This will be joined by a new renewable energy tender, whose volume is still being evaluated between 600 and 900 MW , with the participation of projects that have a definitive license and a storage requirement of 50%.
This second process would complement the renewable energy tender launched in 2025, which culminated in June 2026 with the award of 325.69 MW of battery-backed generation , through power purchase agreements with prices between USD 0.1060 and 0.1090/kWh .
The contract was signed in a market that, according to the Ministry of Energy and Mines, already had nearly 2,000 MW of non-conventional renewable energy in operation as of June of this year, associated with accumulated investments of approximately USD 3 billion . The official projection aims to reach 2,600 MW by 2028.
For 2027, Santos also detailed the planning for two other contracts: 900 MW of existing thermal generation , towards the end of the year, and approximately 800 MW of new firm generation , although this latter volume remains subject to definition.
However, the expansion of installed capacity also poses new challenges for its integration into the electrical system, particularly due to operational restrictions affecting some renewable developers.
Juan Carlos Pais , CEO of Grupo País, explained that Dominican banks went from having little experience in renewables to financing large operations, such as the USD 100 million loan granted by a single banking entity to the Cotoperí project in 2024 .
This evolution was accompanied by the structuring of long-term energy purchase agreements, which are fundamental to providing predictability to developers' income.
In fact, the renewable energy tender awarded this year included 15-year PPAs , a condition that allows for the distribution of commercial risks and supports the financing of investments.
But the emergence of spills changed the economic conditions of projects that had been structured under other operating assumptions.
"We have had to refinance virtually all of our renewable energy projects because of the dumping problem," Pais said.
He explained that the financial institutions agreed to extend the capital amortization periods, considering that the measures to reduce these restrictions will allow for improved operating conditions.
In this context, storage becomes relevant not only for incorporating new renewable generation, but also for improving the use of existing facilities.
Specifically, one of the calls being prepared by the Government aims to incorporate batteries into power plants that are already operational , opening up an alternative for developers who have generation infrastructure and power purchase agreements.
Pais explained that, in these cases, one of the possibilities is to remunerate the storage capacity added to the projects.
But Grupo País is also making progress in another direction: the incorporation of batteries for frequency regulation , which will allow it to generate income from services to the system and, at the same time, will help to mitigate spills.
To put the problem into perspective, the executive pointed out that around 400 MW of generation must enter the system during midday to provide frequency regulation services , coinciding with the hours of highest photovoltaic production.
According to their analysis, incorporating batteries to cover some of those services could free up space to take advantage of a greater proportion of solar generation.
BESS remuneration, a condition for mobilizing investments
The expansion of storage raises a discussion that goes beyond installed capacity: how to economically recognize the different services that batteries can provide to the electrical system .
Joel Santos pointed out that there are four forms of remuneration: payments for energy, auxiliary services, payments for power and a fixed payment scheme associated with the project of the Dominican Electricity Transmission Company (ETED) .
"The battery can be remunerated through ancillary services, particularly frequency regulation," he said.
This distinction is important because storage systems can fulfill different functions. While some allow solar energy to be shifted to nighttime hours, others provide frequency regulation or backup services to improve grid stability.
In the case of ETED, Santos indicated that a fixed remuneration linked to the characteristics of the transmission project is contemplated.
The state-owned company had reported in May 2026 that it was making progress in the technical, financial and legal structuring of a scheme to incorporate private investment in storage, with a reference size of 600 MW/1200 MWh .
The process seeks to respond to the increased demands faced by the National Interconnected Electric System (SENI), resulting from the growth in demand and the incorporation of variable sources of generation.
The minister also reiterated the need to incorporate between 600 and 800 MW of storage by 2028, in addition to the ETED project , to reduce spillages, make better use of available generation and strengthen grid stability.
From a financial perspective, Pais indicated that the frequency regulation has a remuneration scheme established by the Superintendency of Electricity, with prices defined for five years , which allowed progress in structuring new investments.
"We have recently placed orders for all our projects, with investments of nearly $40 million to implement frequency regulation batteries," he noted.
The executive explained that these facilities will have a double benefit: receiving specific remuneration for the services provided and contributing to reducing the restrictions that currently affect renewable generation.
In addition, it identified opportunities in next-generation hybrid projects and system-scale storage solutions, such as the ETED initiative, in which 39 participants enrolled.
In the latter case, the batteries could be used for energy arbitrage, shifting energy to other time slots, and providing auxiliary services.
From the contracting framework to the execution of the projects
While the Government is moving forward with structuring new contracts and remuneration mechanisms, AES Dominicana is preparing to incorporate storage in four of its renewable energy projects .
"Starting in the second half of October, we will have our first two projects, Bayasol and Santanasol, which will begin to have batteries," said Carlos Birbuet , Director of Natural Gas Origination at AES Dominicana.
Meanwhile, he specified that Peravia and Mirasol have an additional delay of approximately 30 days, so their next processes are scheduled for November 2026.
The company already has experience in storage at facilities such as Andrés and Itabo, and continues to extend this technology to its renewable generation portfolio.
The incorporation of batteries takes on special importance in a market where new solar and wind projects are beginning to be developed with specific storage requirements.
The renewable energy tender launched in 2025, for example, established the mandatory integration of BESS systems for new power plants, contemplating a minimum storage capacity of four hours.
This requirement seeks to promote the shift of energy towards periods of greater need and reduce dependence on conventional generation for certain stability services.
However, Birbuet cautioned that the possibility of making these investments also depends on timely decisions and having suppliers capable of responding to the increased pressures on international supply chains.
"Time is money," he said, emphasizing the need to work with partners who can complete projects within the established deadlines and budgets.
In economic matters, the executive also considered it essential that the contracting mechanisms include adequate conditions for private capital.
"The incentives have to be the right ones," he said, referring to rates of return, forms of remuneration, and mechanisms for recovering invested capital .
Their proposals reflect one of the challenges of expanding storage: establishing conditions that allow the technical requirements of tenders to be translated into business models capable of attracting financing and completing projects.
Private capital faces a new stage of expansion
The participation of the local financial system is also acquiring a relevant role in supporting energy investment needs.
In that regard, Juan Carlos Pais highlighted the evolution of Dominican pension funds as a source of capital for the sector.
He specified that there are approximately USD 300 million from these funds invested in energy , linked to projects that represent more than USD 800 million of CAPEX , considering financing and equity.
Experience becomes relevant in a market where upcoming contracts include technologies with different revenue profiles, payback periods, and operational risks.
For investors, the evolution of storage involves analyzing new remuneration mechanisms and understanding how batteries can be integrated into both existing renewable projects and standalone installations.
Pais argued that the combination of renewables and batteries is also changing the supply possibilities in relation to the time required to develop thermal generation.
As a reference, he mentioned that a combined cycle power plant can take around six years to become operational, while the growth of artificial intelligence and data centers is generating new demands for electricity supply.
In that scenario, he considered that renewables, accompanied by storage, can offer more manageable energy and compete with other generation alternatives.
For the Dominican Republic, an island market that depends on fuel imports, this development is especially relevant in terms of energy security.
At the close of the panel, Joel Santos reaffirmed the Dominican government's willingness to work with the private sector to advance the transformation of the electricity system.
The challenge for the coming years will be to link new contracts with remuneration and financing mechanisms that allow for the incorporation of storage, improve the use of renewable generation, and sustain the expansion of the electricity supply.