Countries › Panama › Guide › 12. Sectors › Renewable energy incentives in Panama: solar under Ley 37 de 2013, wind under Ley 44 de 2011, tender preferences and self consumption

Renewable energy incentives in Panama: solar under Ley 37 de 2013, wind under Ley 44 de 2011, tender preferences and self consumption

Last verified: 2026-10-29 · Status: Stable

Solar and wind projects get duty, ITBMS and other tax exemptions on equipment, accelerated depreciation and technology specific power tenders: up to 20 years for solar contracts and up to 15 years for wind, with the share of demand capped by the Secretaría Nacional de Energía. Since 2024 the solar exemption also covers the selective consumption tax and reaches any buyer of the listed equipment. In all State block power tenders cleaner sources get a 5 percent price preference, and distributed self consumption runs under an ASEP procedure whose penetration caps were tightened in 2025.

Panama's currency, the balboa (B/.), is at par with the US dollar, which circulates as legal tender; the Superintendencia de Bancos states that the balboa's value is on a par with the US dollar (checked 29 October 2026). USD figures therefore equal the balboa figures.

Key facts

Maximum term of solar only tender contracts	20 yearsLey 37 de 2013 art. 13, as of 2026-10-29 · in force
Maximum term of wind only tender contracts	15 yearsLey 44 de 2011 art. 14, as of 2026-10-29 · in force
Price preference for cleaner sources in power tenders	5 %Texto Único Ley 6 de 1997 art. 163, as of 2026-10-29 · in force
Income tax credit for public infrastructure works by solar projects (share of direct investment)	5 %Ley 37 de 2013 art. 20 numeral 2, as of 2026-10-29 · in force
ITBMS standard rate	7 %Código Fiscal, ITBMS, as of 2026-10-29 · in force

The rule

1. The tendering institution holds solar only tenders for energy and or capacity, with resulting contracts of up to 20 years; the solar share contracted through such tenders cannot exceed the percentage set by the Secretaría Nacional de Energía.Ley 37 de 10 de junio de 2013, arts. 13 and 14, 2013-06-10 official text · verified 2026-10-29

2. People and companies that build, operate or maintain solar plants or installations are exempt from the selective consumption tax (ISC), import duty, tariffs, fees, contributions and ITBMS on imports or local purchases of the equipment, machines, materials and parts needed. The exemption is not limited to builders and operators: it extends to anyone who buys the listed goods, with no quantity limit.
Cost to do it: Saves import duty and the 7 percent ITBMS on qualifying equipment.
Example: B/.200,000 of panels and inverters: ITBMS saving B/.14,000 plus any import duty. / US$200,000 of equipment: US$14,000 of ITBMS saved plus any duty.Ley 37 de 2013 art. 20 numeral 1, as worded by Ley 417 de 2023 art. 1 (earlier by Ley 38 de 2016), art. 20 numeral 1, 2023-12-27 official text · verified 2026-10-29 · changed: Ley 417 de 2023 added the selective consumption tax to the solar exemption, in force from the fiscal year after promulgation (2024), per its art. 3.

3. Solar projects also get an income tax credit of up to 5 percent of direct investment in works that become public infrastructure (roads, bridges, schools, health centres), not transferable, and may use accelerated depreciation. To use the incentives they need an ASEP generation licence or concession, or a Secretaría Nacional de Energía certification if not providing public electricity service. Listed goods include solar water heaters, panels and cells, long life stationary batteries and inverters.Ley 37 de 2013, art. 20 numerals 2 and 3 and parágrafo, 2013-06-10 official text · verified 2026-10-29

4. ITBMS is charged at 7 percent on taxable sales and services, which is the tax the solar and wind equipment exemptions remove.Dirección General de Ingresos, ITBMS guidance, ITBMS page, 2026-10-29 official text · verified 2026-10-29

5. The State transmission company holds wind only energy tenders with contracts of up to 15 years; the total wind energy contracted through them cannot exceed the percentage of annual consumption set by the Secretaría Nacional de Energía after consulting the transmission company and ASEP.Ley 44 de 25 de abril de 2011 arts. 14 and 15, art. 15 as worded by Ley 18 de 26 de marzo de 2013, arts. 14 and 15, 2013-03-26 official text · verified 2026-10-29

6. Holders of a wind generation licence are exempt from import duty, tariffs, fees and ITBMS on equipment and parts for building, operating and maintaining wind plants, may use accelerated depreciation, and also get the incentives of Ley 45 de 2004 for new renewable sources; companies manufacturing wind generation equipment in Panama get a 15 year exemption from national taxes on that activity.Ley 44 de 2011, arts. 22 and 24, 2011-04-25 official text · verified 2026-10-29

7. In each tender to buy power and energy, the State transmission company must give a 5 percent preference in evaluated price to renewable, cleaner sources (natural gas, geothermal, wind, direct solar conversion, combustion of national waste and hydro up to 3 MW of continuous capacity); distributors buying directly must grant the same preference.Texto Único de la Ley 6 de 1997, art. 163, 2021-07-05 official text · verified 2026-10-29

8. For customers self generating under ASEP's Procedure for Self Consumption with New, Renewable and Clean Sources, ASEP set transitional penetration caps in the EDEMET, EDECHI and ENSA zones: installed capacity of 4 percent of maximum annual energy consumption (GWh) and 13 percent of maximum annual demand (MW) in the indicative demand report, applicable from 30 April 2025 to 31 December 2025 or until the procedure was amended after public consultation.ASEP Resolución AN 20197-Elec de 2025 (Gaceta Oficial 30278-A of 15 May 2025), articles first, second and fourth, 2025-05-15 official text · verified 2026-10-29 · changed: 2025: transitional self consumption caps of 4 percent (GWh) and 13 percent (MW) per distribution zone, to 31 December 2025 or the amended procedure.

Item	Solar (Ley 37 de 2013)	Wind (Ley 44 de 2011)
Equipment duties and ITBMS	Exempt, also ISC since 2024; any buyer	Exempt for licence holders and importers for resale
Accelerated depreciation	Yes	Yes
Dedicated tenders	Up to 20 year contracts	Up to 15 year contracts
Share cap	Set by Secretaría Nacional de Energía	Set by Secretaría Nacional de Energía
Other	5 percent tax credit for public works	Ley 45 de 2004 incentives also apply

Main incentives by technology.

Worked example

A hotel installs a B/.150,000 (US$150,000) rooftop solar system: the panels, inverters and batteries come in free of import duty and ITBMS, saving at least B/.10,500 (US$10,500) of ITBMS at 7 percent.
A 50 MW wind farm bidding in a wind only tender can secure a contract of up to 15 years, and in general tenders its bid is evaluated with a 5 percent price preference.

Step by step

Obtain the ASEP generation licence (or a Secretaría Nacional de Energía certification for non utility uses).
Apply to the Ministry of Economy and Finance for recognition of the equipment exemption before importing.
Watch for solar or wind only tenders and general block power tenders run for the distributors.
For self consumption, apply to the distributor under the ASEP procedure and check the current zone penetration cap.

Common traps

The 2025 self consumption caps were transitional; check whether the amended ASEP procedure now sets different limits before sizing a project.
Solar and wind incentives are special and cannot be extended to other generators.
The 5 percent tax credit only covers works handed over as public infrastructure and cannot be sold or offset.

Sources

← Electricity market in Panama: concessions, generation licences, large customers, ownership limits and ASEP fines under Ley 6 de 1997Ports in Panama: AMP concessions and operating licences under Ley 56 de 2008, the 2026 Balboa and Cristóbal ruling and transitional operators →

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