Panama’s electricity market is approaching two important changes. More homes and businesses are generating their own solar power, while the government prepares a competitive process that could determine whether Naturgy and ENSA continue operating the country’s electricity distribution networks after 2028.

This is not technically an opening for a “third electricity company.” Panama already has three distribution companies: EDEMET, EDECHI, and ENSA. However, EDEMET and EDECHI are both controlled by Naturgy, while ENSA is backed by Colombia’s EPM. In practice, this leaves Panama’s distribution market under two major operating groups.

The upcoming process could allow new investors or international utility companies to compete for control of these distributors.

Could Naturgy Lose Its Position?

The current 15-year distribution agreements expire in October 2028. Under Panamanian law, ASEP must organize a competitive process involving the majority shareholdings of EDEMET, EDECHI, and ENSA.

In March 2026, ASEP selected the Inverlink-EEC-VVGM 2025 consortium to advise the government during the process. The consulting group will have 24 months to review the legal, financial, operational, and technical structure of the distribution market.

The current operators may participate and remain in Panama. However, there is no guarantee that Naturgy or ENSA’s existing controlling investor will retain their positions. New companies could also compete for the majority stakes.

ASEP says the objective is to improve service quality, efficiency, coverage, and accountability under the next operating period.

For Naturgy, the timing is significant. Its network serves large portions of Panama’s interior, where residents regularly express frustration over voltage fluctuations, unexpected outages, and lengthy scheduled maintenance.

Naturgy does respond to reported failures and continues to invest in maintaining and expanding its network. The company has also stated that its intensified maintenance program is designed to reduce unplanned interruptions. However, some maintenance projects can require electricity to be suspended for up to 10 hours.

Why Rural Panama Is Particularly Affected

Communities such as Cambutal, Playa Venao, and Torio and Mariato often depend on long distribution lines with limited redundancy.

In simple terms, some rural areas are connected through a single principal route rather than a network with multiple alternatives. If a tree, transformer, vehicle accident, or equipment failure affects that route, the electricity company must locate and repair the problem before power can be restored.

This does not mean rural Panama lacks electricity infrastructure. Most established communities are connected to the national grid, and service teams generally respond when significant problems occur. The challenge is that individual failures and maintenance projects can affect large areas for extended periods.

Solar Is Creating Another Form of Competition

At the same time, Panamanians are becoming less dependent on electricity purchased entirely from the grid.

More than 7,000 residential, commercial, and industrial users have installed approximately 196 megawatts of solar capacity for self-consumption. Solar production increased by 17.5% during the first four months of 2026, while total renewable generation grew by 11.8%. Electricity generated from fossil fuels fell by 28.7%.

The solar industry expects another 50 megawatts to be installed during 2026. This growth has been so rapid that ASEP is reviewing how much additional distributed solar power Panama’s existing networks can safely absorb.

The temporary national limit for solar self-consumption was recently increased to 5% of annual electricity consumption and 16% of maximum demand.

For traditional distributors, this creates a new business challenge. Every home or company producing part of its own electricity purchases less energy from the grid. For consumers, however, solar provides greater control over monthly operating costs.

What This Means for Property Owners

For rural properties, solar energy is increasingly being considered for reliability as well as savings. A system combining solar panels, battery storage, a compatible inverter, and grid power can keep essential equipment operating during an outage.

Buyers should remember that ordinary grid-connected panels usually shut down when the public grid fails. Batteries and properly configured backup circuits are generally required for continued electricity during an interruption.

As Panama reviews its distribution operators and expands solar self-consumption, electricity infrastructure will become an increasingly important part of property due diligence. Buyers should examine the local grid connection, voltage stability, backup systems, water pumps, internet equipment, and the property’s capacity for solar installation.

Naturgy is not necessarily leaving Panama, but it is entering a period of greater scrutiny. Competition for the distribution companies, combined with the rapid adoption of solar energy, could ultimately give residents better infrastructure, cleaner power, and more control over how their homes are supplied.

Casa Solution helps buyers evaluate properties throughout Panama, including utilities, access, infrastructure, solar potential, and backup systems. Contact our team to explore homes, land, and investment opportunities across the country.

Article written: June 21, 2026