Countries › Dominican Republic › Guide › 12. Sectors › Electricity market and concessions

Electricity market and concessions

Last verified: 2026-10-30 · Status: Stable

Private and foreign capital may own generation and distribution, but transmission and hydroelectric generation stay in State hands. Plants feeding the grid need a definitive concession from the Executive for up to 40 years, processed through the SIE and the CNE. Below 2 MW no concession is needed, and users of 1 MW or more can buy directly from generators.

USD figures use the Banco Central de la República Dominicana reference selling rate of RD$60.9007 per US dollar, as shown on its home page on 30 October 2026, rounded to the cent.

Key facts

Maximum term of a definitive concession	40 yearsLey 125-01 art. 49, as of 2026-10-30 · in force
Generation below which no concession is needed	2 MWDecreto 555-02 art. 60, as of 2026-10-30 · in force
Non regulated user threshold	1 MWLey 125-01 art. 108 paragraph I, as of 2026-10-30 · in force
Non regulated user technical contribution	10 %Ley 125-01 art. 108 paragraph II, as of 2026-10-30 · in force
Generation a distributor may own	15 % of peak demandLey 125-01 art. 11 paragraph I, as of 2026-10-30 · in force
Transmission and hydroelectric generation	State only Ley 125-01 art. 131, as of 2026-10-30 · in force

The rule

1. Electricity companies, self producers and cogenerators organised as electricity companies are subject to the law whether their capital is national or foreign, private or public, with no discrimination on that ground.Ley 125-01 General de Electricidad, art. 10, 2001-07-26 official text · verified 2026-10-30

2. Any legal entity, national or foreign, that wants to run a generation or distribution business must apply for a provisional or definitive concession.Decreto 555-02, Reglamento de Aplicación, art. 57, 2002-07-19 official text · verified 2026-10-30

3. In interconnected systems above the demand set by regulation that supply distributors, one company may carry out only one of generation, transmission or distribution. It may still build the line stretches needed to connect its units.Ley 125-01, art. 11, 2001-07-26 official text · verified 2026-10-30

4. Each of the three distributors that came out of capitalization may own generation only up to 15% of peak demand of the interconnected system. Renewable energy does not count toward that percentage.Ley 125-01, art. 11 paragraphs I and III, 2001-07-26 official text · verified 2026-10-30

5. If the SIE proves a forbidden link between companies, the accused company has up to 120 days to divest, with penalties of up to 5% of its assets.Ley 125-01, art. 11 paragraph II, 2001-07-26 official text · verified 2026-10-30

6. No concession or authorization may be given for hydroelectric generators or for transmission, which remain under State ownership and operation.Ley 125-01, art. 41 paragraph IV and art. 131, 2001-07-26 official text · verified 2026-10-30

7. A provisional concession gives access to land for studies. On State or municipal land it cannot exceed 18 months, and it must be published twice in a national newspaper within 15 days.Ley 125-01, art. 43, 2001-07-26 official text · verified 2026-10-30

8. The SIE publishes a provisional concession request within 5 working days, third parties have 5 working days to object, and the SIE then decides within 20 working days.
Cost to do it: Publication of the grant is at the applicant's cost (art. 65 paragraph). No official fee schedule for the application was found.Decreto 555-02, art. 62 and 64, 2002-07-19 official text · verified 2026-10-30

9. Definitive concessions are granted by the Executive. The request goes to the SIE with an environmental effect study, the SIE sends a recommendation to the CNE, and the CNE passes an approved file to the Executive.Ley 125-01, art. 45 to 47, 2001-07-26 official text · verified 2026-10-30

10. The CNE issues its recommendation to the Executive within 25 working days of receiving the SIE report.Decreto 555-02, art. 79, 2002-07-19 official text · verified 2026-10-30

11. Definitive concessions last no more than 40 years. Renewal may be requested no less than 1 year and no more than 5 years before expiry.Ley 125-01, art. 49, 2001-07-26 official text · verified 2026-10-30

12. If several applicants seek the same definitive concession, the SIE runs a public tender for the rights and the CNE proposes the award to the Executive.Ley 125-01, art. 48, 2001-07-26 official text · verified 2026-10-30

13. Generation and transmission need no concession where maximum demand is below 2 MW, including supply to distributors, as long as technical rules are met. Isolated systems above 2 MW do need one.Decreto 555-02, art. 56, 60 and 88, 2002-07-19 official text · verified 2026-10-30

14. Generation or distribution concessions cannot be transferred, in whole or in part, by sale, lease, merger or other act, without prior SIE authorization.Decreto 555-02, art. 82, 2002-07-19 official text · verified 2026-10-30

15. No concession may be given for units that use toxic waste, and the environment ministry must first issue a no objection certificate.Ley 125-01, art. 45, 2001-07-26 official text · verified 2026-10-30

16. A concession lapses automatically if the holder fails to start or finish works within the dates set in the concession, and the Executive may revoke it for repeated breach on SIE recommendation and CNE opinion.Ley 125-01 as amended by Ley 186-07, art. 61 to 63, 2007-08-06 official text · verified 2026-10-30

17. Regulated service ends below 1 MW. From 2011 onward a user of 1 MW or more may be a non regulated user (UNR).Ley 125-01 as amended by Ley 186-07, art. 108 paragraph I, as replaced by Ley 186-07 art. 5, 2007-08-06 official text · verified 2026-10-30

18. Non regulated users pay a technical service contribution of 10% of the contracted energy and capacity price, on top of transmission and distribution use charges. Generators pay it monthly and it passes to regulated customers through the tariff.
Cost to do it: 10% of the contract price. On a monthly contract bill of RD$10,000,000 (about US$164,201.73), the contribution is RD$1,000,000 (about US$16,420.17).
Example: RD$1,000,000 a month on a RD$10,000,000 contract / US$16,420.17 a month on a US$164,201.73 contractLey 125-01 as amended by Ley 186-07, art. 108 paragraphs II and III, 2007-08-06 official text · verified 2026-10-30

19. Users grouped in shopping plazas, residential projects and condominiums cannot be a non regulated user, except free zones.Ley 125-01 as amended by Ley 186-07, art. 108 paragraph IV, 2007-08-06 official text · verified 2026-10-30

20. Companies in generation, transmission and distribution fund the SIE with contributions capped at 1% of total sales in the wholesale market. Market agents also fund the Organismo Coordinador.Ley 125-01; Decreto 555-02, art. 37 d; art. 54, 2001-07-26 official text · verified 2026-10-30

21. Electricity companies, self producers and cogenerators may directly import the fuels and lubricants their plants need, with prior CNE authorization.Ley 125-01, art. 129, 2001-07-26 official text · verified 2026-10-30

22. Foreign companies investing in the sector may remit dividends and repatriate capital, subject to the laws in force.Ley 125-01, art. 130, 2001-07-26 official text · verified 2026-10-30

23. Distributors buying under long term contracts must tender. SIE-092-2025-LCE set the rules for a tender of up to 600 MW of solar and wind, with projects of 20 MW to 300 MW, batteries of at least 4 hours and long term contracts paid in dollars.Resolución SIE-092-2025-LCE, CNE notice, whole text, 2025-08-14 official text · verified 2026-10-30 · changed: Published August 2025: first requirement that all projects in the tender include storage of at least 4 hours.

24. The CDEEE, the former State holding, was ordered into liquidation with its functions moved to the Ministry of Energy and Mines, and a unified board was created for the three distributors. Ley 365-22 then suppressed it.Decreto 342-20; Ley 365-22, whole text, 2020-08-16 official text · verified 2026-10-30

Activity	Private or foreign capital	Permit
Thermal, solar and wind generation above 2 MW	Yes	Definitive concession from the Executive
Generation below 2 MW	Yes	No concession, technical rules apply
Distribution	Yes	Definitive concession with a defined zone
Transmission	No, State only (art. 131)	Not available, except a special connection line (art. 41 paragraph III)
Hydroelectric generation	No, State only under Ley 125-01 (art. 131)	See the trap on Ley 57-07
Sale to users of 1 MW or more	Yes	Non regulated user status and SIE rules

Who may do what in the electricity chain

Worked example

A foreign group plans a 50 MW solar plant. It sets up or registers a local vehicle, takes a provisional concession to study the land, files for the definitive concession at the SIE with an environmental study, and waits for the CNE (25 working days after the SIE report) and the Executive. It may build the connection stretch, but the transmission company operates it (art. 11).
A factory with 3 MW of demand moves to UNR status and signs a generator at a monthly bill of RD$10,000,000 (about US$164,201.73). The 10% contribution of RD$1,000,000 (about US$16,420.17) is paid by the generator, so expect it to be priced into the contract.

Step by step

Check that the activity is open: transmission and hydro are not.
Secure land rights and ask the SIE for a provisional concession if third party land must be studied.
Obtain the environmental authorization and the no objection certificate (art. 45).
File for the definitive concession at the SIE.
SIE report to the CNE, CNE recommendation within 25 working days, then Executive authorization.
Sign the power contract, or enter the tender process of the distributors.
Register as a market agent with the Organismo Coordinador before injecting energy.

Common traps

Ley 125-01 art. 41 paragraph IV bars hydro concessions, while Ley 57-07 lists hydro plants up to 5 MW for incentives. We found no text reconciling them, so confirm with the CNE before budgeting a mini hydro.
The official compendium is a 2012 edition. Decreto 167-21 and other later changes to the regulation are not in it.
A transfer of the concession by merger or between related companies still needs SIE approval (Decreto 555-02 art. 82). Check this before any share or asset deal.
The ban on generators linked to distributors carries a 120 day divestment clock and penalties of up to 5% of assets. Screen group structures before bidding.
No official current fee schedule for concession filings was found, so none is given.

Sources

← Key sectors and regulatorsDistributed generation and rooftop solar →

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