El Salvador Perspectives

Just after Nayib Bukele announced that El Salvador would be the first country in the world to make Bitcoin legal tender, he also made headlines by suggesting there was "volcano energy" to attract Bitcoin miners to come to the country. In light of the very energy-intensive nature of Bitcoin mining, it makes sense to understand the overall state of electric power generation in El Salvador.   Global bitcoin-mining currently consumes more electricity than the country of Argentina . Official data on electricity generation and use in El Salvador is maintained by Unidad de Transacciones S.A de C.V. which administers the transmission and market for electricity. As shown in the chart below, the four principal sources of electric power in El Salvador currently are hydropower, fossil fuels (primarily bunker diesel power generation), geothermal, and imports (primarily from Guatemala). Renewable sources such as solar, biomass, and wind made up a small but growing 9% of total electric...

Source: 2017 SIGET statistics report El Salvador's electricity is currently generated from a variety of sources, with the largest quantity of installed electrical generating capacity coming from fuel oil burning generators: Fossil fuels (primarily fuel oil) - 42% Hydro - 30% Biomass - 14% Geothermal - 11% Solar -- 3% To reduce dependence on fossil fuels, which contribute to greenhouse gasses and must be imported from volatile international markets, El Salvador would need to increase the use of renewable energy sources.  El Salvador has numerous renewable energy sources as described in this August 2017 report from the US government: El Salvador contains vast water reserves and receives large amounts of sunlight. Therefore biomass, wind, solar, hydroelectric and geothermal energy opportunities exist in the country.  In order to facilitate the projects organizations such as: The Inter-American Development Bank, USAID and OPIC fund major energy projects with in t...

In a ceremony today, El Salvador officially inaugurated the largest solar power station in Central America.   The plant consists of 320,000 photo-voltaic panels which at peak capacity can provide electricity to serve 150,000 homes. The plant Providencia Solar is located on the highway between San Salvador and the Costa del Sol, in the municipality of El Rosario in the departament of La Paz.  It was built at a cost of $151 million and is operated by the renewable energy company Neoen .

The Worldwatch Institute has published an article touting El Salvador's leadership in expanding the use of geothermal energy to generate electricity: El Salvador, known as the “land of volcanoes,” is the largest producer of geothermal electricity in the region with 204 MW of production. With approximately 24 percent of its total electricity production coming from geothermal resources, El Salvador is a world leader in the development of geothermal power. Moreover, the country received a US$2 million grant from the Inter-American Development Bank (IDB) in May to establish a geothermal training center for Latin America and the Caribbean. As part of this initiative, the international training center will offer technical courses in geothermal energy development at la Universidad de El Salvador.  Despite a destructive, decade-long civil war during the 1980s and two devastating earthquakes in 2001, El Salvador has managed to develop a successful geothermal energy sector. The countr...