The state-owned company LaGeo plans to invest in its geothermal fields in Chinameca and San Vicente to increase its generation capacity to an additional 80 megawatts.
In order to finance the works, the public company LaGeo, a subsidiary of the Lempa River Hydroelectric Executive Commission (CEL Group), is negotiating a $232 million loan with the World Bank.
The settlement was made through the purchase of the Salvadoran Government for $280 million stake in geothermal LaGeo which owns the Italian company.
From a statement issued by the Executive Hydroelectric Commission of the Lempa River:
While in El Salvador preparations are being made to celebrate the country's independence, in Washington representatives of the Salvadoran government and the Italian company ENEL GREEN POWER are putting and an end to a long running dispute. The agreement allows the Salvadoran State to recover the total shares of LaGeo that had been held by the Italian company.
At the request of the three companies interested in the 213 MW work, the deadline for submitting bids has been extended until May 6.
May 6 is the date for receipt of the proposals from the three companies interested in the design, financing, construction and operation of the hydroelectric dam Changuinola II, in the province of Bocas del Toro.
Prensa.com reports: "Interested companies have expressed concern about potential claims that could be brought AES Panama, three years ago they lost the concession to develop Chan II, after which the State, through the National Authority of Public Services, determined that if this entity built the hydroelectric station it would control over 40% of energy generation in the country, which is prohibited by Law 6 of February 3, 1997 which regulates the electricity sector. "
LaGeo could exploit geothermal energy in a new well located in San Vicente, generating 30 to 40 megawatts.
The company LaGeo invested about $24 million in the exploration which led to the discovery of the new geothermal source.
As outlined in an article in Eleconomista.net, the Executive Hydroelectric Commission of the Lempa River (CEL), a partner in the LA GEO which belongs to the Italian company Enel, states that "a possible plant could generate more than $37 million in annual revenues for the company."
While in other Central American countries there is a boom in projects for clean energy generation, in the past three years El Salvador has not registered any.
According to data from Bloomberg, for the past three years, El Salvador has not recorded any investment in clean or renewable energy, its last investment was made in 2007, when it invested $45 million.
Latin America is one of the most promising renewable energy markets for Enel Green Power, which plans to invest more than 2 billion Euros by 2016 for the development of renewable energy in the region.
Latin America is a rapidly expanding market, where it is expected that energy demand will have an average annual growth of 3.5% by 2020.
To meet this growing demand, "renewables will play an important role and we have about 830 MW of renewable capacity in operation, capable of producing over 3.4 million kilowatt hours of energy with zero emissions," said Enel Green Power (EGP)’s area manager for Iberia and Latin America Maurizio Bezzeccheri in a recent interview.
Enel Green Power says there is room to diversify sources of energy in Central America .
Representatives of the company, which has presence in Brazil, Mexico and Chile, have shown interested in developing geothermal projects in Guatemala, where they are diversifying the development of energy sources.
Legal stability, foreign investment protection and a business friendly environment are the elements that companies such as Enel are looking for in order to bring their business to Central America.
At least 10 companies have already acquired the bidding rules ready to present bids on 28 October.
Among the companies interested in bidding is Centrans Energy which operates a wind farm in the Pacaya volcano area, which generates 50 MW and represents an investment of $125 million.
An article in Elperiodico.comgt states "The bidding rules require that at least 60 percent of the 800 MW must be generated by renewable power plants (hydroelectric, wind, solar, etc.) and a maximum of 40 percent for existing plants (bunker, diesel and coal) The traditional power plants can bid for contracts of up to 5 years, compared to the renewables whose contracts can be up to 15 years long."
Enel Green Power announced the start of construction of a new hydroelectric power plant between Alajuela and San José.
The new plant, called Chucas, would have an installed capacity of 50 MW and once operational it will generate about 219 million kWh/year, the equivalent annual consumption of over 81 thousand homes.
Enel Green Power, owned by Enel Group which focuses on renewable energy, hopes to complete the plant by mid-2013, increasing their installed capacity in Costa Rica to 105 MW.
Empresa Electrica de Bogotá submited a bid for a section of the power grid belonging to Italy's Enel.
The bid is for the purchase of a stake in "Transmisora de Energía Renovable" (Transnova), a company owned by Enel.
"Enel has total control over Transnova, through its subsidiaries in that country, Enel Guatemala SA, which controls 98% and Generadora Montecristo SA, which has a 2% share of the renewable energy generation company" reported Dinero.com.