“A GROWING ENERGY

MARKET: TENDERS FOR

ELECTRICITY SUPPLY IN
GUATEMALA”
Marcela Peláez
Director
National Electric Energy Commission
 Guatemala: Stable Macroeconomy and Energy Regulatory Framework

• Guatemala is the largest economy in Central America

78419

with sustainable economic growth and prudent

macroeconomic policies (stable exchange rate and
inflation)

• The energy system operates according to free market

principles and stable regulatory energy framework

Gross Domistic Product (GDP) Stable Exchange Rate

MILL USD
8.00

QUETZALES PER DOLLAR

7.95
$100,000
7.90
$78,419
$80,000 $67,804 7.85
$58,599 7.80
$60,000 $45,980 7.75
$37,670
$40,000 7.70
$19,894
7.65
$20,000
$2,754 7.60 Stable exchange rate
$0 7.55 Q7.79 = US$ 1.00
Guatemala Panamá Costa Rica El Salvador Honduras Nicaragua Belice
7.50

1/07/2020
1/08/2020
1/09/2020
1/10/2020
1/11/2020
1/12/2020
1/01/2021
1/02/2021
1/03/2021
1/04/2021
1/05/2021
1/06/2021
1/07/2021
1/08/2021
1/09/2021
1/10/2021
1/11/2021
1/12/2021
1/01/2022
1/02/2022
1/03/2022
1/04/2022
1/05/2022
1/06/2022
1/07/2022
1/08/2022
1/09/2022
1/10/2022
1/11/2022
1/12/2022
1/01/2023
1/02/2023
1/03/2023
1/04/2023
Guatemala´s Country Risk

Country risk rating agencies

Central America: Rating Comparison

upgrade Guatemala´s
score from stable to positive

Emerging Markets Bond Index (EMBI) https://www.moodys.com/credit-ratings/Guatemala-Government-of-credit-rating-600011455

S&P and Fitch

upgraded
Guatemala’s
rating from
stable to
positive

S o urc e : JP Morgan
 Guatemala: The ideal destination for Nearshoring

Guatemala has
a privileged
geo-strategic
position, close
access to large
markets
(Mexico, USA,
Europe, etc.)
Guatemala: Robust Energy Transmission and Distribution´s Networks and
Strong Infrastructure for Logistic
Guatemala has the most robust energy
transmission network in Central America
(5,010 kms, growth +140% in 22 years)
Strong
Infrastructure
for Logistics Interconnection
with Mexico

• 2 International
airports

Transmission´s Distribution´s
Networks Networks Interconnection
with Central
• The biggest port America
2000 2022 ∆ operation in the
northern triangle 2006 2022
Transmission Lines 2,080 Kms 5,010 Kms + 140% with access to Medium Voltage Grid 33,777 km 44,362 km
Substations 43 177 + 377%
the Pacific and
Atlantic oceans Low Voltage Grid 52,907 km 62,958 km

MVA installed in the distribution grid 3,629 4,397

The Distribution´s network has been expanded

more than 25% in the last 16 years
 “Guatemala:
A Growing Energy Market”
 Energy Sector: Technical Institutions and Competitive Market

Institutions: Markets Agents:

Quantity

Strong and technical Generators* 63 63

institutions with long-
term vision and
planning 63 14
Transports

More of 25 years of
consolidated and
competitive electricity
Distributors
63 17
market

International Private Investors:

Traders 63 32

Large Users
63 1,310

* INDE participates with the same market rules. Source: AMM Investor's Guide
Distribution Electricity Companies
East Distribution Company (DEORSA)

West Distribution Company (DEOCSA)

Empresa Eléctrica de Guatemala (EEGSA)

Municipal Electric Companies

Distribution
Companies
66%

Non Regulated Users

26%

Municipal Electric Companies

8%
 Guatemala: A Growing Energy Market

2,250
Anual Maximum Demand Load Factor
80%
(Consumption)
2,000

75%
1,750

1,500 70%

1,250
65%
MW

In the last 25 years the energy demand

1,000
grew 3.4 % every year (average)
60%
750 In the last 25 years the Load Factor of the
system has become more efficient
500 2022 55% (was 0.58 and now is 0.76)
Capacity Installed 3,393 MW
250 Energy Generated 11,826 GWh
50%

ene-2006
ene-1999
ene-2000
ene-2001
ene-2002
ene-2003
ene-2004
ene-2005

ene-2007
ene-2008
ene-2009
ene-2010
ene-2011
ene-2012
ene-2013
ene-2014
ene-2015
ene-2016
ene-2017
ene-2018
ene-2019
ene-2020
ene-2021
ene-2022
ene-2023
0
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Source: AMM (Wholesale Market Operator)
 Guatemala: A Growing Energy Market
In the last 25 years…
23%
Energy 49% Non Renewable
Non Renewable
subsector has
received more
2001 2022
than US$10
billion of private 51% 77%
investments Renewable Renewable

The generation with renewable

energy grew more +26%
(from 51% to 77%)

Electricity Access grew + 89%

Guatemala: Largest Energy Market in Central América

 Growth of Distributed Generation

Power Capacity Installed of Distributed

Self-Producers Renewable Generators
Renewable Generators
140

Solar 123.8 MW 25,000 5,000

120 20.3 MW 22,145
4,500
Thermal 20,000 4,000
3,700
100 6.3 MW

Power Installed Kw
3,500
MW

123.8MW 15,000 3,000

80

Users
12,886
62.2 MW 2,500
60 10,000 7,407 2,000
1,588
Hidro
97 MW 1,500
40 5,000 1,000
Distributed Generation 675
has grown ´+100% in the 500
20
last 7 years 0 0
DEOCSA DEORSA EEGSA
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Energy Transition: International Commitments of Guatemala

Paris Climate Agreement NDC- Reduce emissions

Sustainable Development Goals

(United Nations Organization)

Green Climate Fund (GCF) Planned Funds > $60 MM

NDC:
Clean Energy - For 2030 reduce 11% the emissions compared to
2005 with own funds and 22% with support
 High potential for Renewable Energy Generation
Potentials:

4,690 MW

5.3 kWh/m2 /day

204 MW

Geothermal Potential Areas:

18 Areas=+966 MW

Current Geothermal Capacity

Installed: 99.2MW

Source: Ministry of Energy and Mines

Guatemala: Energy Policy
Energy Policy:
Reduce electricity supply costs and
diversify the source of energy
generation, prioritizing renewable
resources and promote the
e-mobility

National Low
Emission
Development
Strategy
Incentives for National
Renewable Determined
Energy Projects Contributions
Development Law (NDC) 2021

Expansion Plan
National of the
Energy Generation
Efficiency System 2022-
Plan 2019- 2052
2032

Source: Deloitte, roadmap for Guatemala's energy transition 2022

 Long Term Tenders: PEG-1, PEG-2 & PEG3

• Since 2010, Guatemala has made 3 long term tenders

• With that awarded more than +900 MW of renewable capacity
• The new renewable plants reduced the spot price and the emissions

700.
635.6 Spot Price (USD/MWh)
RENEWABLE NO RENEWABLE
525. MIX
939.4 201.5
MW MW
MW

350.

175.
120.0
101.0 87.5
71.3
44.0 47.3 34.2
15.0
0.
Hidráulica Hidráulica Biomasa Gas Biomasa
GDR Natural Búnker

Average Price (USD/MWh)

Source: AMM (Wholesale Market Operator)

PEG 4: Ongoing Tender

235 MW
Capacity + Energy • PPA for 235 MW, where a
minimum of 50% must be
renewable energy
New Power Plants
PPA - 15 years

Up to 40MW for
Geothermal Energy

• PPA for 15-year for new projects

(COD: May/2026, May/2027 or May
2028)
PEG5: Coming Soon Tender

Guatemala need a new

>1,000 MW long-term tender for
PEG-5 more than +1,000 MW
with COD 2030
PEG5: Coming Soon Tender

+1,000 MW
Energy Policy
Minimum 80% Renewable

Technologies
COD • Geothermal
2030 • Natural Gas
• Offshore Wind
• Green H2
• Energy Storage

Capacity + Energy
PPA
PPAs of 15 years with
Distribution Companies
 Energy Transition: Specific Incentives

INCENTIVES FOR RENEWABLE ENERGY ELECTRIC MOBILITY INCENTIVES LAW DECREE 40-22
PROJECTS DEVELOPMENT LAW REGULATION GOVERNMENT AGREEMENT 295-2022
DECREE 52-2003 TECHNICAL STANDARD CNEE-69-2023

Considered renewable energy projects:

• Incentives for electric, hybrid and hydrogen
• Solar
vehicles, and electric transportation systems imports,
• Eolic assembly and manufacturing.
• Hydroelectric
• Geothermic
• Biomass
• Hydrokinetic (ocean waves energy)
• Green Hydrogen

Tax Exemptions:
• Income tax (10 years)
• Value added tax
• Import taxes
Green hydrogen receives the incentives of the Renewable
Energy Generation Law (Government Agreement 180-2022)
Regulation Update

COMING SOON…
Technical Rules for
Technical Rules for Storage
Electric Vehicle
Technical Rules for
Charging Stations Working on: Distributed Renewable
Generation
• Capacity for Renewable
Technical Rules for Grid
Published by CNEE Energy with Storage Working on:
Connection -NTC- (Batteries, H2V, etc)
on march 2023
• Creation of a retail
• Simplification of the process.
• Storage for Primary market for under 5MW
• Connection time reduced.
• Expedited Disagreement Frequency Regulation renewable generators
Resolution Process.

Published by CNEE
on march 2023
Future Transmission Projects

An
Interconnection
with Belize

Reinforcements
in the transmission
lines(400 kV y 230 kV)

A Second
Interconnection
with Mexico
 www.cnee.gob.gt
Marcela Peláez
Director-National Electric Energy Commission
[email protected]
https://www.linkedin.com/in/pelaezmarcela