Panama’s Energy Minister Jorge Rivera said the country’s cabinet had approved an energy transition plan, which includes cutting carbon emissions, promoting electric mobility, embracing ethanol, and ending the use of coal and heavy fuels at its power plants. Panama aims to use biofuels to replace a portion of fossil fuel, mostly imported from the US, and to rely more on renewables, including wind and solar, for power generation.
The only coal-fired power plant operating in Panama belongs to a metals mining project operated by a unit of US-based First Quantum Minerals. The government has negotiated a new contract that includes the conversion of its 300-MW power plant. The talks are expected to be concluded this year, the minister said. Other power plants running on diesel or heavy fuels will be phased out by the end of 2023, replaced by a 670-MW natural gas plant expected to enter service in 2024.
Panama also plans to resume imports of ethanol in 2023 to be mixed up to 5% into gasoline. The country will then work with sugar cane farmers to produce the biofuel domestically and increase the mix to 10%. Panama has also resumed talks with Colombia to share electricity through an ambitious 300-kilometre interconnection project.
