This is a best prospect industry sector for this country. Includes a market overview and trade data.


In 2018, El Salvador’s installed electricity generation capacity was 1.824 MW, and system demand was 1,081 MW.  Total exports to other markets in Central America are 89.6 million kWh and imports are 1.675 billion kWh.  mainly from Guatemala.  Electrification is above 98% of the population in urban areas and 86% in rural areas. 

In 2017, the generation sources in the market were broken down as follows: 23.9% hydroelectric, 22% geothermal, 19% thermal, 7% biomass, 1% solar, and 26% imports to meet the country’s requirements for electrical production.

Generation market share is divided as follows: 47% State owned, 30% multinationals, and 23% local operators. the distribution market share is divided between 97% multinationals and 3% local distributors. El Salvador’s strategy is developed by the government and is primarily focus in energy efficiency and promoting participation of renewable energy (solar, wind and biogas). The market is made up of purchase power agreements (PPA) awarded in competitive auctions supervised by the regulator and the Spot market. Transmission is State owned, and the market is regulated by the Superintendencia General de Electricidad Y Telecomunicaciones (General Superintendent for Electricity and Telecommunication - SIGET).  

El Salvador’s policy is to expand the country’s natural resource capacity to decrease fossil fuel dependency. To this end, in 2007, the Salvadoran government passed Decree 462 which grants tax breaks to companies who develop renewable energy projects and provides for 10 years of import tax exemptions for purchases of machines and equipment. In addition, the Salvadoran Government released the 2010-2024 National Policy the purpose of which is to modernize and expand the country’s natural resource capabilities in order to increase the contribution of these energy sources to the national energy supply. 

Private sector companies, NGOs, and regional banks develop relationships with Salvadoran counterparts such as SIGET, the Ministry of the Environment and Natural Resources (MARN), and National Energy Council (CNE) to create solar, hydroelectric, wind, thermal and biomass energy projects, especially in the areas of Acajutla and La Paz. To date the country has developed hydroelectric and geothermal capabilities with an installed capacity of 487 MW in hydroelectric power and 204.4 MW in geothermal. In addition, the government is in the process of attracting private sector companies for solar, biomass, and wind capacities.


Leading Sub-Sectors

The government is receptive to expanding the renewable energy sector, especially in areas that take advantage of the country’s vast water sources, and large amounts of sunlight.  Also, biomass, wind, solar, hydroelectric, and geothermal energy opportunities exist in the country. In order to facilitate these projects, organizations such as: The Inter-American Development Bank, USAID, and OPIC fund major energy projects within the country.

There are three biomass plants in El Salvador. The plants include: CASSA, El Ángel, and La Cabaña. In 2011, these three plants produced 109.5 MW of electricity. In addition the country is developing hydro-electric power from biogas found in landfills. The Nejapa landfill receives the solid waste from San Salvador with a total installed capacity of 6.3 MW, there is the potential to increase the capacity by up to 10 MW. 

El Salvador has created projects in anaerobic bio digestion as an alternative to the traditional practices of removing organic wastes. There are 3 installed systems including: Granja de los Hermanos Jovel (717 m3), Avícola Campestre (6,600 m3), andAgroindustrias San Julián (1,200 m3).

Due to the country’s location on the Pacific Ocean, El Salvador receives strong winds in various areas of the country. Twelve locations with winds reaching higher than 700 W/m2 to 50 meters above the ground level were selected as potential sites for wind farms.
For a complete List of Wind Farm Locations

The central region of El Salvador receives a high level of solar radiation (5.3 kWh/m2/day). Therefore photovoltaic systems are an opportunity to take advantage of the country’s vast solar resources. Most solar panels are installed in government buildings, schools, and universities. The capacity of the largest photovoltaic system is 99 MW. Currently there are 14 solar panel systems installed in El Salvador with a total production capacity of  344.86 MW.

There are four hydroelectric dams located in the Lempa River. The following plants on the Lempa include: Guajayo (19.8 MW), Cerrón Grade (172.8), 5 de Noviembre (99.4 MW), 15 de Septiembre (180 MW). These plants are overseen by the Río Lempa Hydroelectricity Board (CEL). As of 2012, the country had a total of 20 power plants with an installed capacity of 487 MW. According to the Government’s Master Plan, 18 sites with the potential for capacities greater than 20 MW were identified and 209 sites with capacities less than 20 MW. The total potential hydroelectric production capacity of El Salvador’s sites are 2,258 MW of. Unfortunately, hydroelectric energy is only obtainable during the rainy season (May-October).
For more information regarding the Salvadoran government's Renewable energy Master Plan

El Salvador has the highest level of geothermal production in Central America. The country has an installed capacity of 204.4 MW within two geothermal installations. Report by the National Energy Council (CNE) locates 12 geothermal sites in El Salvador with underground temperatures estimated above 150° C (high enthalpy), and 12 geothermal sites with underground temperatures estimated between 90 to 150° C (low enthalpy). The geothermal potential in both categories equals 791 MW in total and increases the potential generation capacity by 25.8%.


The Government of El Salvador is actively looking to attract investors to expand the country’s renewable energy capacity, which translates into opportunities for companies that can provide for needs ranging from technology to equipment procurement to consultancy services. TThere is also a need for solar cells and panels, generators, support structures, and hydroelectric power stations. Tenders can be followed on the Ministry of Energy’s website.  

Specific opportunity is a green energy tender to solicit bidders for a  28 megawatts photovoltaic energy and biogas project, 20MW and 8MW, respectively. The potential investment is USD58 million over the next three years.  Specific anouncemnts are available at  Interested parties are expected to submit their proposals by December 2018 and contracts between electricity distibutors and generators will be signed in April 2019.  SIGET would determine the price of the megawatt and contracts will be awarded for 15 years.  Photovoltaic energy projects should enter in operation in 2020 and the biogas projects in 2021.  

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