Panama, here we come! 5 good reasons for our expansion

Whenever we decide to enter a new market, we do so with one goal in mind: to expand the global availability of our solar-as-a-service solution and to drive the energy transition with clean solar power in yet another emerging market.

The fact that we have now decided to expand to Panama is due on the one hand to the great demand from companies for our offer to switch to solar energy and on the other hand to the fact that Panama offers almost perfect conditions for our business model and is therefore made for expansion like almost no other country in the world. Find out what makes Panama such a successful country for solar energy here.

1) A stable economy

Since we are always concerned with ensuring the long life and successful operation of our solar projects, not only the individual customers but also the countries themselves are subjected to a thorough review. Thanks to its stable and flourishing economy, Panama offers the best conditions for the sustainable expansion of solar energy, as it is home to many successful and stable companies. Furthermore, contract negotiations are usually uncomplicated and can lead to the signing of a contract within a few weeks.

Last but not least, the Panamanian economy is based on the US dollar and is therefore free from exchange rate fluctuations and currency risk, which again makes it much easier to conclude contracts.

2) A reliable EPC partner

One of the most important prerequisites for the success of our solar projects is a smooth cooperation with our general contractors or EPC partners, who take care of the installation and maintenance of the solar systems on site. We have found such a partner in Panama in Solar Power Pat. The company, which has been active on the Panamanian solar market for more than 10 years and has since realized more than 300 projects for industrial, commercial and private customers, can look back on a lot of experience and convinced us from the very first moment. Our Regional Director for Latin America & The Caribbean, Ravi, has already met the Solar Power Pat team during a visit to Panama and can confirm: We are getting along very well, and we are sure that there will be many more joint projects to come. We came into contact with Solar Power Pat through PROINSO, a long-time partner of ours who not only provides the equipment for the first solar system we’re about to build in Panama, but also supports us in developing our presence in existing and new markets. That is some real team work right there.

3) High grid electricity prices

Switching to solar energy is always particularly desirable when our customers can not only do something good for the environment by doing so, but also benefit from significant savings compared to the regular grid electricity price at the same time. In Panama, the electricity price for commercial and industrial customers ranges from $0.14/kWh – $0.18/kWh. As of June 2021, the average price per kilowatt-hourwas$0.169, significantly higher than other Latin American countries.

These high electricity prices are a real financial burden for local businesses and prevent them from growing. Using their own solar power system, which produces not only clean but also low-cost solar electricity, is therefore an attractive alternative to grid power for many businesses in Panama. Our one-stop solution enables these companies to switch to solar power as easily as possible. With our solar systems, companies can save an average of about 30% of their electricity costs. This is clearly noticeable in the high electricity consumption of commercial and industrial enterprises and ensures a high demand for our solar solutions.

4) Good legal conditions

Panama offers another advantage when it comes to solar energy: here, solar power is not only popular with businesses due to the high savings in their environmental impact and electricity costs, but is also actively supported by the government and promoted through beneficial regulations. This allows companies to feed surplus solar power, which is produced on weekends, for example, but is not purchased by the company itself, into the public power grid without a fee. This energy fed into the grid is then offset 1:1 against the companies’ electricity bills, allowing them to benefit from further cost savings. This feed-in regulation, also known as net metering, is a rarity globally and makes the switch to solar power many times more attractive for companies than in a country without net metering.

In addition, businesses in Panama are allowed to cover their entire electricity needs with a solar system and completely disconnect from the grid without always having to draw a certain amount of electricity from the public grid. This is also often prevented by legislators in other countries. This ensures that businesses often rely on smaller solar installations and only get a portion of their electricity needs from solar energy. In Panama, on the other hand, companies are free to decide on the size and power of the solar system, powering their entire operations with solar energy and taking full advantage of the sun’s power.

5) The proximity to Costa Rica

Whenever we enter a new market, we make sure that we have local sales teams on the ground to take care of our projects and customers. On the one hand, this facilitates the acquisition of new projects, and on the other hand, it brings enormous advantages to our customers, as they benefit from a local contact person who speaks their language and is not only familiar with the customs of the country, but above all with solar energy and systems.

In the case of Panama, we can rely on our sales duo Ravi and Claire, who have been working in neighboring Costa Rica since 2019 and are very familiar with the solar market in Central America. The fact that Panama and Costa Rica are so close to each other allows them to travel quickly and easily to the new Panama projects, meet with customers and continue to expand the market. In this way, we can ensure that both existing and new customers in Panama receive the best possible service.

5 reasons, many projects

Each point by itself, but especially their combination, make Panama a true paradise for solar energy. We intend to take advantage of this and further expand our presence in the Central American country in the coming weeks, months and years. The first three projects in Panama, which together have a total capacity of almost 1 MWp, have already been signed. Stay tuned and keep an eye out for more Panamanian projects in the future. There are many more to come.