Panama puts sustainability at the heart of its government's actions, whether in the economic, diplomatic, or energy spaces. Through steadfast conservation commitments on land and at sea, as well as a bold energy transition plan, Panama has become one of three carbon negative countries in the world. Contact online >>
Panama puts sustainability at the heart of its government''s actions, whether in the economic, diplomatic, or energy spaces. Through steadfast conservation commitments on land and at sea, as well as a bold energy transition plan, Panama has become one of three carbon negative countries in the world. Panama is committed to unlocking both a blue and green economy through sustainable use of ocean resources, increased use of clean energy, ecological programs to preserve wildlife habitat and environmental regulations to reduce plastic waste and marine pollution while fostering eco-tourism and sustainable fishing.
Despite being a service- and trade-oriented country, Panama is one of only seven carbon negative countries in the world, setting a standard for other developed countries globally. Panama has made reducing carbon emissions a top priority and has committed to embedding sustainable practices into everything the government does, in line with the transformative changes necessary to drive the future of Panama''s socio-economic growth.
Recognizing climate change as a serious threat with global ramifications, Panama has proactively led on taking climate action. As a nation with unparalleled natural reserves at the intersection of two main oceans, Panama has retooled its economy to reduce carbon emissions and spearheaded bold conservation initiatives to protect its natural resources.
Avoiding the worst impacts of climate change means reimagining economies around green energy, both on land and at sea. A green economy incentivizes low carbon emissions, uses resources efficiently and leaves no one behind.
Panama has an ambitious but practical plan to move our economy away from fossil fuels and into clean energy, using 70% renewable energy sources by 2050. Panama''s sustainability and conservation initiatives are already well underway. In 2019, Panama became the first Central American country to eliminate plastic bags and straws, a major source of pollution which were clogging our waterways and damaging our marine life.
Moreover, Panama has established a system of incentives to foster the production of energy from renewable sources, all while creating jobs, protecting natural resources and improving our electricity matrix. Among these incentives: companies that invest in new clean energy projects in Panama can be eligible for a tax incentive of up to 25%, and energy plants receive tax benefits according to their carbon reduction level.
These initiatives, bringing together the power of the private and public sectors, have already put Panama on the path to a green economy.
Panama has a greater number of vertebrate animals than any other country in Central America or the Caribbean, a greater number of bird species than the United States and Canada together, and 21 times more plant species per square kilometer than Brazil.
Panama''s seas also contain a myriad of exotic tropical fish, whales, dolphins, crocodiles, turtles and more. Its oceans are among the best worldwide for humpback whale watching – every year, approximately 2,000 cetaceans journey along Panama''s coasts in one of the longest mammal migrations, a journey of 10,000 km from the Antarctic to the warm tropical waters of Panama.
Panama, boasting 30% of its land as national parks, tropical forest reserves, or wildlife refuges covering 2 million acres, welcomes visitors to explore its growing eco-tourism sector. In line with this commitment, the Tourism Action Plan for Protected Areas (2016-2026) was launched, emphasizing the protection and enhancement of Panama’s ecotourism. This holistic initiative encompasses awareness campaigns, sustainable infrastructure development, and specialized training, ensuring a responsible and sustainable approach to showcasing Panama’s natural beauty across its 16 national parks.
Home to biodiverse ecosystems, Panama takes its responsibility to protect and conserve its natural beauty very seriously. The country has already extended significant protections across its territory, nearly a decade ahead of the global community''s goal to conserve 30% of terrestrial and marine habitat by 2030. In fact, during the Our Ocean Conference 2022, Panama announced a further extension of protected marine region to over 54%.
By creating national parks on land and designating more than 46 marine protected areas, Panama is both ensuring the protection of its ecosystems and conserving carbon sinks that have been vital to its carbon negative status. In 2022, Panama approved an innovative policy giving legal rights to nature, protecting its right to exist, persist, regenerate, and be restored. In addition, Panama has committed to reforest 1 million hectares nationally, which will contribute to the removal of approximately 7 million metric tons of CO2 from the atmosphere per year.
Fostering clean energy is a central pillar to Panama''s climate plan. In our National Energy Plan, Panama will run on 70% renewable resources by 2050.
Panama provides tax and import duty exemptions and incentives for the construction, operation and maintenance of clean energy projects. For instance, wind energy equipment manufacturers can receive a 15-year exemption on all taxes in Panama. Incentives like these, combined with a price on carbon, are transforming Panama into a hub for clean energy innovation. Already, emissions from Panama''s energy sector are projected to decline by at least 11.5% by 2030 and 24% by 2050.
In addition to incentivizing increases in clean energy and decreases in carbon emissions, Panama is also working to implement carbon capture capabilities, both on land and at sea. We have committed to restoring 50,000 hectares of forest land nationally, which will contribute to the absorption of approximately 2.6 million tons of CO2 by 2050. We are also providing reinforced legal and environmental protections to sea grasses and coral reefs, thereby increasing carbon sinks in our waters.
As part of Panama''s efforts to reduce its national carbon footprint, the government launched the National Reduce Your Footprint Program, encouraging and facilitating carbon emissions reduction across public and private organizations, government ministries, the Panama Canal and entities spanning various economic sectors. The program will create a national system for monitoring, evaluating and reporting emissions, and will include sustainability criteria in public procurement processes. Panama has collaborated with the UN''s Collaborative Instruments for Ambitious Climate Action (CiACA) in the creation of tools like this one to track carbon emissions, with the goal of using this data to implement a carbon pricing model.
Even as countries like Panama take action to reduce their carbon emissions, the reality is that climate change is a global challenge requiring collective efforts. Addressing global crises calls for global solutions, which is why Panama has actively sought to inspire climate action internationally. For example, Panama launched a Carbon Negative Alliance with Bhutan and Suriname, the world''s only other carbon negative countries, to share best practices and advocate for larger global climate ambition. In addition, Panama partnered with Costa Rica, Colombia, and Ecuador in 2021 to expand the Eastern Tropical Marine Corridor, creating the largest collective marine protected area in the world and preserving vital migratory routes for biodiverse marine species.
"Cooperation is fundamental to address the challenges we all face. Sustainability and tackling climate change are not tasks for one country alone, but a collective effort involving neighboring nations, international organizations and civil society. Together, we can develop effective strategies to address the connections among natural resources, while at the same time protecting the environment and promoting economic prosperity for our societies through their participation".
Panama has partnered with the UN on a series of conservation and climate initiatives, including the conservation of marine wildlife in the Caribbean, the development of a national policy for the sustainable use of coastal resources, the reduction of single-use plastics pollution in marine environments, the creation of a national wetlands policy and the adaptation of Panama''s fishing and tourism industries to climate change.
Panama is one of the first Latin America countries working to develop a national action plan on litter in collaboration with the UN and over 40 impacted organizations.
In addition, in 2020, Panama updated its UN Nationally Determined Contributions with new targets across 29 sectors, including marine and coastal systems. Panama''s new goals will strengthen its management of marine and coastal systems and integrate blue carbon into the national inventory of greenhouse gases by 2022.
Mission Panama is the dedicated source of information about transparency, sustainability, inclusion and purposeful development of the Republic of Panama. Our goal at Mission Panama, an organization launched by the Ministry of Foreign Affairs in 2021, is to raise visibility of the country''s initiatives and mission-driven investments which are transforming the country''s economy and have enabled Panama to achieve carbon negative status. With a renewed focus on sustainability, gender equality, and leveraging the country as a responsible destination for tourism and business, Panama is poised for continued growth and invites you to be a part of it.
Panama City, Panama, 22 May 2018 – Upgrades to Panama’s regulatory environment and power system management are critical to achieving the renewable energy goals set out in the country’s National Energy Plan, per a Renewables Readiness Assessment Panama report released by the International Renewable Energy Agency (IRENA). The report was launched at high-level event in Panama City today and presented to the country’s Secretary of Energy, Dr. Victor Urrutia.
A central recommendation of the report calls for amendments to the country’s regulation of Power Purchase Agreements (PPAs) for variable renewable energy sources, such as solar and wind. Currently, these renewable energy technologies are attributed a value of zero ‘firm capacity’ – the actual amount of energy that a power plant can guarantee to make available under maximum operating conditions – while thermal power plants and hydropower facilities are rewarded with far higher firm capacity values. This makes solar and wind less competitive in Panama’s wholesale electricity market, and can disincentivise investment.
“Enabling policies and attractive regulatory frameworks can drive renewable energy deployment, which in turn can boost low-carbon economic growth and enhance energy security,” said IRENA Director-General Adnan Z. Amin. “Panama’s abundant renewable energy resource potential offers the country an opportunity to cost-effectively meet its long-term energy needs and underpin its transition to sustainable energy future.”
Panama’s National Energy Plan is a roadmap that seeks to increase the share of renewables in the power system to 70 per cent by 2050. By the end of 2016, wind and solar power capacity had reached 270 megawatts (MW) and 90 MW respectively.
“Panama can set a strong example for the Central American region by utilising our potential to generate 70 per cent of our electricity from hydropower, wind and solar resources,” said Dr. Victor Urrutia, Secretary for Energy for Panama. “IRENA’s support through this RRA process will facilitate the realisation of our long-term ambition."
"In addition to the moral and ideological imperative, we also have an enormous interest and commitment to renewable energy,” continued Secretary Urrutia, “renewables are no longer an alternative option but instead offer a clear path to the future.”
Increased shares of solar and wind will also require significant flexibility mechanisms in Panama’s evolving electricity network. Combined with updated power system planning and operational practices, these measures can help ensure the reliable integration of variable renewable energy in a cost-effective manner, the report suggests.
The development of a domestic renewable energy workforce is also key to the success of Panama’s renewable energy programme and can bolster the growing solar PV and wind energy markets in the country. The report recommends an examination of the current national workforce in the field of renewables, compared with projected future needs in order to help inform modifications to domestic education and training programmes.
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