Guatemala is at a decisive moment in its effort to consolidate its energy transition. Although the country has more than 85% of untapped renewable energy potential and several strategic tenders underway, the lack of transmission infrastructure has become the main bottleneck for sector growth.

This assessment comes from the Guatemalan Renewable Energy Generators Association (AGER), which represents more than 70 companies with a combined installed capacity of 1,700 MW.

The association emphasised that without the ability to transport electricity through the grid, renewable generation cannot be converted into an effective supply for users. This warning is especially relevant after the recent PET-3 transmission tender was declared void, providing concrete evidence of the current limitations of the national grid.

Expectations are now focused on the government reactivating a new process—PET-4—with technically viable conditions that can support the awarding of projects in PEG-5 and future rounds. Without addressing this critical link, Guatemala could face tariff distortions and even medium-term supply risks.

The expansion of the solar sector, meanwhile, contrasts with the rigidity of the transmission network. Projects awarded under PEG-4-2022, currently under construction, will add 190 MW of peak capacity to the system. In addition, around 800 MW of new solar capacity is under development, driven by the competitiveness of solar PV and the country’s strong resource potential, estimated at 7,000 MW available for most of the year.

Many of these new developments are designed not only to serve regulated demand but also to supply emerging sectors such as data centres, advanced manufacturing, and nearshoring operations, all of which have high electricity consumption needs.

On the regulatory front, AGER pointed to the need to update the country’s energy policy and regulatory framework in line with new technological dynamics. This structural modernisation should enable the integration of energy storage, support higher penetration of solar and wind power, increase system flexibility, expand the transmission network, and accelerate the digitalisation of electricity operations.

The update must also consider new demand trends, including urban growth, electric mobility, rural electrification, and the demographic expansion expected to peak in 2030. According to AGER, this requires an energy policy built through multisector participation, with legal certainty, competition, and efficiency as core principles.

At the same time, AGER maintains an ongoing technical dialogue with the main energy-sector authorities, including the Ministry of Energy and Mines, the National Commission of Electric Energy (CNEE), the Wholesale Market Administrator (AMM), the Ministry of Environment (MARN), and the country’s distribution companies. The shared agenda includes key topics such as updating energy policy, modernising operational and commercial regulations, transmission planning, promoting investment in renewables, and streamlining administrative procedures.

Regarding the PEG-5 tender, the association expects it to become a real opportunity to expand the country’s installed capacity. To achieve this, the technical and economic criteria must not restrict the competitiveness of clean technologies or introduce conditions that favour fossil-fuel options, which are costlier and subject to international price volatility.

“We hope PEG-5 becomes an opportunity to increase installed capacity without limiting the competitiveness of renewable technologies or favouring fossil-fuel alternatives,” said AGER’s Executive Director, Astrid Perdomo.

The cancellation of PET-3 was, for the association, a warning sign. It highlighted the need to rethink transmission planning with a long-term vision and conditions that attract investors. Without solving this issue, the system will be unable to absorb the capacity awarded in PEG-5 or in future tenders.

“Guatemala has the opportunity to position itself as a competitive, energy-secure, and renewable-investment-friendly country—if the technical elements outlined are addressed. This is the ideal moment to do so,” Perdomo concluded.

Guatemala is at a decisive moment in its effort to consolidate its energy transition. Although the country has more than 85% of untapped renewable energy potential and several strategic tenders underway, the lack of transmission infrastructure has become the main bottleneck for sector growth.

This assessment comes from the Guatemalan Renewable Energy Generators Association (AGER), which represents more than 70 companies with a combined installed capacity of 1,700 MW.

The association emphasised that without the ability to transport electricity through the grid, renewable generation cannot be converted into an effective supply for users. This warning is especially relevant after the recent PET-3 transmission tender was declared void, providing concrete evidence of the current limitations of the national grid.

Expectations are now focused on the government reactivating a new process—PET-4—with technically viable conditions that can support the awarding of projects in PEG-5 and future rounds. Without addressing this critical link, Guatemala could face tariff distortions and even medium-term supply risks.

The expansion of the solar sector, meanwhile, contrasts with the rigidity of the transmission network. Projects awarded under PEG-4-2022, currently under construction, will add 190 MW of peak capacity to the system. In addition, around 800 MW of new solar capacity is under development, driven by the competitiveness of solar PV and the country’s strong resource potential, estimated at 7,000 MW available for most of the year.

Many of these new developments are designed not only to serve regulated demand but also to supply emerging sectors such as data centres, advanced manufacturing, and nearshoring operations, all of which have high electricity consumption needs.

On the regulatory front, AGER pointed to the need to update the country’s energy policy and regulatory framework in line with new technological dynamics. This structural modernisation should enable the integration of energy storage, support higher penetration of solar and wind power, increase system flexibility, expand the transmission network, and accelerate the digitalisation of electricity operations.

The update must also consider new demand trends, including urban growth, electric mobility, rural electrification, and the demographic expansion expected to peak in 2030. According to AGER, this requires an energy policy built through multisector participation, with legal certainty, competition, and efficiency as core principles.

At the same time, AGER maintains an ongoing technical dialogue with the main energy-sector authorities, including the Ministry of Energy and Mines, the National Commission of Electric Energy (CNEE), the Wholesale Market Administrator (AMM), the Ministry of Environment (MARN), and the country’s distribution companies. The shared agenda includes key topics such as updating energy policy, modernising operational and commercial regulations, transmission planning, promoting investment in renewables, and streamlining administrative procedures.

Regarding the PEG-5 tender, the association expects it to become a real opportunity to expand the country’s installed capacity. To achieve this, the technical and economic criteria must not restrict the competitiveness of clean technologies or introduce conditions that favour fossil-fuel options, which are costlier and subject to international price volatility.

“We hope PEG-5 becomes an opportunity to increase installed capacity without limiting the competitiveness of renewable technologies or favouring fossil-fuel alternatives,” said AGER’s Executive Director, Astrid Perdomo.

The cancellation of PET-3 was, for the association, a warning sign. It highlighted the need to rethink transmission planning with a long-term vision and conditions that attract investors. Without solving this issue, the system will be unable to absorb the capacity awarded in PEG-5 or in future tenders.

“Guatemala has the opportunity to position itself as a competitive, energy-secure, and renewable-investment-friendly country—if the technical elements outlined are addressed. This is the ideal moment to do so,” Perdomo concluded.