Guatemala is adjusting its national energy strategy with a clear goal: correct delays in major transmission investments and advance a redesigned program to add new generation capacity. Both efforts are considered essential to support a reliable grid and a more diversified electricity mix.

In an interview with Energía Estratégica, Deputy Minister of Energy and Mines Juan Fernando Castro Martínez stressed that the country’s primary bottleneck remains the transmission system. “Without transmission, there is no transition — it is fundamental,” he said, emphasizing that expanding infrastructure is critical to enabling new renewable energy projects such as solar PV, hydropower and biomass facilities.

Although the Transmission Expansion Program 3 (PET-3) failed to attract viable bids during its recent tender, authorities confirmed that its components will not be abandoned. Several works are being reassigned to alternative procurement mechanisms allowed under Guatemalan law. One flagship initiative is the new transmission line to the northern department of Petén, where the National Electrification Institute (INDE) is preparing a direct contracting process expected to move forward soon.

PET-3 was originally designed as a nationwide plan to reinforce connections between the northern and central regions, modernize substations and increase grid capacity. However, low bidder participation and financial concerns undermined the competitive process. As a result, the Ministry is redefining conditions, phasing execution into smaller segments and applying more flexible approaches to ensure progress.

Meanwhile, the Generation Expansion Program 5 (PEG-5) is under review by utilities, private investors and regulators. Built on lessons learned from PET-3, this updated roadmap seeks to integrate new supply nodes, accommodate rising demand and incorporate stricter technical criteria from the design stage. The proposal also aims to strengthen Guatemala’s commitment to renewable energy development by diversifying sources beyond traditional hydropower.

Political support appears to be growing. A group of lawmakers has introduced legislation to streamline approval processes for large transmission projects. Should public tenders face additional obstacles, the government is considering legal alternatives such as direct acquisitions, provided they comply with transparency and oversight requirements.

Several other strategic initiatives—such as the technical closure of 59 wells in the Campo Chan area and upgrades at the national smelting facility—are expected to receive final decisions early next year. To advance these projects, the Ministry will request additional budget resources, noting that funding is essential to avoid prolonged delays.

During a recent business forum, the Deputy Minister emphasized that private-sector engagement will play a decisive role in the country’s energy transformation. He also highlighted the longstanding contribution of the Central American Bank for Economic Integration (CABEI), which has supported diversification across the region through financing for projects like the Chabal hydropower plant and the San Antonio bioenergy facility.

Guatemala’s path toward a modern power system continues to evolve. Despite regulatory and operational challenges, the government aims to correct stalled processes, accelerate infrastructure execution and strengthen collaboration with investors. With key decisions expected in early 2025, authorities hope to consolidate a more resilient, efficient and sustainable electricity matrix.