Are Blackouts Frequent or Is Electricity Reliable in Panama?

Electricity is one of the most important necessities for the economic development of any nation because everything requires energy. As one of the fastest-growing economies in Latin America, Panama has its fair share of ups and downs when it comes to providing the energy needs of the nation.  

Blackouts are not frequent in Panama. Brownouts are more frequent. Electricity is generally reliable but not consistently stable.  Electricity in Panama is not something that an ex-pat or a foreign visitor needs to worry about. 

While its occurrence is not regular like once or twice a month, you will experience partial and temporary power interruptions if you are living in Panama. These brownouts occur in certain areas in the provinces or portions in the city because of a restricted, momentary reduction in total system capacity. Interim brownouts are used when maintenance and repairs are conducted or as a strategy to avert a full-blown blackout.

On the other hand, complete power interruptions or blackouts are rare in Panama. These blackouts can last for several hours and result in the disruption of work and other economic activities that rely on electric power. In the last three years, Panama experienced two major blackouts. 

The most previous occurred last January 2019, when a massive power outage hit the country three days before the papal visit of Pope Francis for World Youth Day.  The earlier one happened in July 2017, when heavy rains caused an electricity shutdown in Panama affecting at least 3.8 million people. The blackout actually happened in entire Central America including Costa Rica, Nicaragua, El Salvador, Guatemala, and Honduras affecting 15 million people.

While short power outages are not a major problem, the bigger concern of the people living in Panama is the power flickers or power fluctuations that regularly occur. These power fluctuations which can last 5-10 minutes and at very random hours, can potentially damage appliances and other electric devices.

A voltage that arrives too high or too low can result in the untimely breakdown of electronic components such as circuit boards of your electronic devices. It can lead to aggregate overheating which can cause malfunctions and damage to electric appliances and gadgets. 

While brownouts and power fluctuations are common, people have learned and adapted ways to deal with them.  In general, electricity is not an issue when you live or visit Panama.

Are Brownouts a Problem in Panama?

If blackouts are rare and brownouts are more frequent, are brownouts a problem in Panama? The categorical answer is no. First of all, most brownouts in Panama are momentarily lasting for a few minutes to an hour or two.

Secondly, it does not happen regularly to the extent that you will consider that as a factor when deciding to stay or live in Panama. Thirdly, longer brownouts such as when repairs are performed are usually announced so that people can prepare in advance.

Finally, most offices, condo buildings, malls, and other major institutions in Panama are usually equipped with emergency generators that will provide temporary power in case of brownouts. So you can hardly have activity interruptions in case of short power failures.

How Do People in Panama Protect Themselves From Power Flickers?

Because power fluctuations are common and can damage appliances, most homes, and offices in Panama are equipped with surge protectors. These devices are designed to cut power in the event of a voltage spike thereby protecting appliances from a sudden increase of electric voltages.

Some also use extension cords or power strips with built-in surge protectors. Some homes install a ground fault circuit interrupter (GFCI) especially in moist areas like the kitchen and toilet, to provide an outlet for electricity.

Computer users also connect their computers or laptops to UPS (uninterrupted power supply) to prevent work loss in case of sudden power failures.  In short, there are effective ways that people can implement or undertake to address damages or losses caused by power flickers.

Is Electricity a Problem in Panama?

NO. While brownouts are frequent, electricity is not a problem. However, like the most developing country, the energy sector in Panama is beset with continuing problems arising primarily because of its growing economy. With its economic growth, the demand for electricity continues to increase outpacing the supply.

To address this problem, the Panama government is continuously finding ways to improve its energy capacity especially by exploring other energy generation sources. At the moment the majority of energy generation capacity in Panama is from hydropower sources. The government is actively pursuing other sustainable and renewable energy sources like geothermal, solar and wind.  

Who Is to Blame for Power Outages in Panama?

It is difficult to point fingers as to who is ultimately responsible for a power outage in Panama. The electricity sector is organized into three main areas, namely: generation, distribution, and transmission. A failure in any one of them can cause a power outage in a certain locality or area.  Thus, it is tough to truly isolate which of them cause power failure. 

Generation is composed of independent private power producers that are given a concession by the government to generate or produce electricity. Distributors are comprised of different local cooperatives or companies that administer the retail distribution and delivery of electricity to consumers in their respective localities or areas of jurisdiction.

Finally, the transmission is managed and controlled by Empresa de Transmisión Eléctrica (ETESA), the state-owned company that owns all transmission assets such as cables, towers, transformers, and other facilities and equipment used to transfer and distribute electricity.  

The ETESA purchases power from private generators. It delivers electricity across the country through retail distribution companies using its transmission lines. The local distributors perform the billing for electricity for individual consumers. As to how, why and who is responsible for power failure is hard to discern because of the multitude of parties involved.

The whole electric industry is regulated by the government through the National Authority of Public Services (ASEP). This regulatory agency is tasked to supervise the electricity market by issuing concessions and licenses, registering generators, and creating policies or rules with regards to generating, transmitting, distributing and selling electricity.

What Government Problems Beleaguer the Electric Sector in Panama?

Some experts stress the need to fully privatize the electric sector of Panama to eliminate the inherent flaws of government in the administration and management of the electricity sector. More specifically, the inability of the state-owned transmission company of ETESA to develop a cost-effective and efficient grid is attributed to political intrigues and conflicts of interest. For one, ETESA and its board are vulnerable to political patronage rotation. 

The regular change of key people managing the company every five years, resulted in its inability to develop long term plans and to sustain projects that could otherwise address the long term electricity needs of Panama.  This also includes the engagement and assignment of maintenance contractors, especially in key power stations.  

Meanwhile, the regulatory intervention of government has resulted to slow bidding of projects especially for power generation, which further slows down the approval and implementation of projects. The government contracting procedures are constraining the swift approval and expedition of development projects.

Will Privatization Address the Electric Problem in Panama?

Some experts believe that mismanagement, efficiency problems, limited funding will ultimately be resolved by privatizing the electricity sector in Panama. However, some people have fears that the lack of government regulation and involvement will come with the hefty price of escalating energy prices or costs that will ultimately encumber the consuming public. Some people maintain that energy or electricity is a public utility. Government regulation is, therefore, necessary to ensure convenient and affordable access to electricity of the people of Panama.

Conclusion

Blackouts are rare in Panama but brownouts are frequent. Electricity is reliable but unstable resulting in regular fluctuations or flickers. In general, electricity in Panama is not an issue that will cause you alarm. While the brownouts and power fluctuations are common, Panamanians have already established ways to address these minimal concerns by equipping major institutions with emergency generators and installing surge protectors in their homes respectively.

While electricity is not a problem in Panama, the country is continually faced with electric problems annually. This is primarily ascribed to the fact that the demand for electricity due to economic growth outpaces supply.

Despite these problems, the government is nevertheless on a relentless pursuit to improve electric services and cope with the demands. it recognizes the importance of electricity in improving the standard of living of its people, and enduring economic advancement and growth of the country as all sectors rely on electricity to power their businesses.

Matt Romero

I’m Matthew Romero, one of the guys behind PanamaLifeInsider.com I am incredibly passionate about Panama, its beautiful territory, and all the incredible opportunities which offer to people coming here from all over the world both either visiting and settling. In this blog, I decided to share my passion with you!

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