Central America’s energy matrix contains an increased amount of hydrocarbon based generation, while the regional interconnection promises to reduce costs through economies of scale.

In the past two decades Central America has not been too successful in achieving sufficient electricity generation with a stable supply at competitive prices.

The regional matrix generation has changed from 66% hydroelectric, 30% thermal, and 4% renewable in 1990, to 41% hydroelectric, 47% thermal and 13% renewable in 2008.

Over the six countries, the electricity sectors and the structure of the market vary widely, ranging from fully competitive wholesale markets to monopolistic utilities that act as a single buyer.

The region is divided into six sub-markets, each with different levels of economic development, energy infrastructure and energy preferences. However, the electricity market in Central America has the potential to benefit from economies of scale.

Source: Ensec.org