Installing electricity infrastructure supply stations with chargers for non-fossil combustion vehicles
Installing electricity infrastructure supply stations with chargers for non-fossil combustion vehicles
Business Model Description
Build electricity supply stations to meet the new demand for vehicles using alternative non-fossil combustion for their mobility.
Expected Impact
Electricity supply through a station network nationwide will induce the use of electric cars, positively impacting the environment and people's health
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
Disclaimer
UNDP, the Private Finance for the SDGs, and their affiliates (collectively “UNDP”) do not seek or solicit investment for programmes, projects, or opportunities described on this site (collectively “Programmes”) or any other Programmes, and nothing on this page should constitute a solicitation for investment. The actors listed on this site are not partners of UNDP, and their inclusion should not be construed as an endorsement or recommendation by UNDP for any relationship or investment.
The descriptions on this page are provided for informational purposes only. Only companies and enterprises that appear under the case study tab have been validated and vetted through UNDP programmes such as the Growth Stage Impact Ventures (GSIV), Business Call to Action (BCtA), or through other UN agencies. Even then, under no circumstances should their appearance on this website be construed as an endorsement for any relationship or investment. UNDP assumes no liability for investment losses directly or indirectly resulting from recommendations made, implied, or inferred by its research. Likewise, UNDP assumes no claim to investment gains directly or indirectly resulting from trading profits, investment management, or advisory fees obtained by following investment recommendations made, implied, or inferred by its research.
Investment involves risk, and all investments should be made with the supervision of a professional investment manager or advisor. The materials on the website are not an offer to sell or a solicitation of an offer to buy any investment, security, or commodity, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction.
Country & Regions
- Panama: Central Region
- Panama: Central Region
- Panama: Western Region
Sector Classification
Renewable Resources and Alternative Energy
In Panama, fossil fuels for the year 2020 emitted more than 3,901 megatons of CO2. Renewable resources as alternative energy, are inexhaustible, competitive, clean sources, abundant throughout the planet as they are; hydraulic, wind, solar, geothermal, tidal and biomass-based energy, which are constituted as the replacement of thermal energy.
Political priority
The decisions agreed in 2015 at the COP21 Paris Convention to which Panama subscribed, is a historic starting point to combat climate change and thus encourage each country to generate a viable platform for both State investment as well as the Private with a view to producing energy with low levels of carbon emissions.
Gender and Marginalization
In Panama 6% of the population lacks electricity service. Gender inequality is addressed in Climate Change summits as an important factor in strengthening efforts against climate warming. The link between gender, climate and security has shown positive signs for climate change in the countries with greatest progress fighting against gender inequality.
Investment opportunities
The global alignment in its different Conventions and agreements for the year 2030 and 2050 in relation to climate change, is representing a great investment opportunity for governments as long as in their countries they can generate laws that encourage attracting foreign private capital .
(Obstacles and Bottleneck) Obstacles such as the lack of alignment of a country to the global trend with climate change, ignorance of technology, ignorance of the social and environmental advantages as well as the incipient Government management.
Alternative Energy
In Panama, more than 35% of its energy matrix is still maintained with fossil combustion. Alternative energy as a substitute for fossil combustion has become the most viable and sustainable option for people in terms of health, as well as for our planet, since they do not generate carbon dioxide and we can obtain it from our natural resources. in an abundant way.
Since 2016 Panama sanctioned the law by which the Paris agreement is ratified, which establishes the adoption of National plans that seek to deal with climate change. Since then, initiatives have been carried out such as the creation of the Ministry of the Environment, the National Energy Plan as a roadmap to develop the energy sector.
Gender and Marginalization
In Panama 6% of the population lacks electricity service. Gender inequality is addressed in Climate Change summits as an important factor in strengthening efforts against climate warming. The link between gender, climate and security has shown positive signs for climate change in the countries with greatest progress fighting against gender inequality.
In 2020 Panama launched its Energy Transition Agenda, which is based on the SDGs with a view to making the sector reliable, safe, sustainable, affordable and accessible. It is important to note that all this is framed within the pillars of the transition: decarbonization, decentralization, digitization, and democratization.
Fuel Cells and Industrial Batteries
Pipeline Opportunity
Installing electricity infrastructure supply stations with chargers for non-fossil combustion vehicles
Build electricity supply stations to meet the new demand for vehicles using alternative non-fossil combustion for their mobility.
Business Case
Market Size and Environment
USD 50 million - USD 100 million
< 5%
The automotive fleet stands at 1.4MM vehicles, according to the Land Transport Authority.
It is a broad market with great opportunities, since recently in April of this year 2022, the Law to Incentive Electric Mobility for Land Transportation was approved.
Indicative Return
5% - 10%
The profile of the project's efficiency indicators was estimated with the parties involved and various information.
Investment Timeframe
Medium Term (5–10 years)
The Law that approved electric mobility is considered disruptive and historic with ambitious goals for the year 2030 and 2050. Said Law contemplates the gradual transition of the government fleet and non-tax incentives for individuals who decide to switch to electric mobility.
Ticket Size
USD 1 million - USD 10 million
Market Risks & Scale Obstacles
Capital - Limited Investor Interest
Business - Business Model Unproven
Impact Case
Sustainable Development Need
Fossil fuels in Panama emitted 9,301 Megatons of CO2 for the year 2020, placing the country in position No. 76 out of 184 countries. Of those 9,301 megatons of CO2, 60% is attributed to the commercial and private automotive sector.
High environmental contamination in the metropolitan area of the city with high population density that are directly affected.
Expected Development Outcome
This opportunity focuses on the supply of electrical energy to electric vehicles which do not emit carbon dioxide and avoid greenhouse gases that are harmful to the atmosphere and global warming.
Gender & Marginalisation
Primary SDGs addressed
7.b.1 Installed renewable energy-generating capacity in developing countries (in watts per capita)
According to data from ADAP, they have sold 145 hybrid vehicles and 25 electric vehicles until August 2021. In 2020 the total number was 195 (hybrid) and 21 (electric) and in 2019 440 (hybrid) and 5 (electric). .
In Panama there are 59 charging stations for electric and hybrid cars, according to the National Secretariat of Energy (SNE).
Secondary SDGs addressed
Directly impacted stakeholders
Planet
Gender inequality and/or marginalization
Indirectly impacted stakeholders
People
Outcome Risks
The non-implementation of directed policies or the lack of updating them can cause the stagnation of the development of this sector.
Impact Risks
High supply costs due to not having adequate incentive policies for the clean renewable energy production sector.
Impact Classification
What
Environmental sanitation is currently a trend, so this business model is the angular link to contribute directly to the use of electric motors.
Who
With the implementation of this business model and with the fulfillment of its objectives, both humanity and the planet will benefit.
Impact Thesis
Electricity supply through a station network nationwide will induce the use of electric cars, positively impacting the environment and people's health
Enabling Environment
Policy Environment
On September 21, 2016, Panama ratified, accepted, approved, its adherence to the historic Paris agreement on climate change and established the creation of a Ministry, laws and the route of a National Strategic Plan 2015-2050.
Ministry of the Environment with governing functions to formulate, apply, plan, direct, coordinate, execute and evaluate the National Environmental Policy, applicable to all levels of government.
In November 2020, the Cabinet Council approved the strategic guidelines of the Energy Transition Agenda, a measure that seeks to encourage investment in the sector, improve competitiveness and bring electricity to the communities indicated in the Beehive Plan.
Financial Environment
Financial incentives: The financing for this IOA is within the regular bank market offer.
Fiscal incentives: The new Electric Mobility Law establishes in its article No. 21 for the importation of electric vehicles the payment of tariffs will be 0% until the year 2030 and for hybrids 5%.
Other incentives: At the Municipal level, the license plate process will be exempted for five years from the acquisition of the vehicle, which directly benefits the user (PERSON)
Regulatory Environment
General Secretariat of Energy; It is in charge of conducting the country's energy policy, within the current constitutional framework, to guarantee a sufficient, high-quality, economically viable and environmentally sustainable supply of energy resources.
National Authority for Public Services (ASEP); It is an autonomous regulatory entity that oversees the provision of water supply, sewerage, telecommunications, natural gas and electricity. Establishes rules, regulations, enforceable acts and their compliance.
In April 2022, Panama sanctioned Law No. 295 on Electric Mobility, which seeks to regulate the transition from combustion vehicles to electric ones, covering its supply network logistics as well as incentives for corporations and individuals.
Marketplace Participants
Private Sector
Capital or local private equity contribution, bank financing under normal conditions of local and international banks, foreign investment.
Government
Ministry of the Environment, National Secretariat of Energy, Public Services Authority.
Target Locations
Panama: Central Region
Panama: Central Region
Panama: Western Region
References
- (1) UN, COP21, 2015 Paris Agreement, Climate Change. https://unfccc.int/en/process-and-meetings/the-paris-agreement/what-is-the-paris-agreement
- (2) UN, Framework Convention on Climate Change, 1994. https://unfccc.int/es/process-and-meetings/the-convention/que-es-la-convencion-marco-de-las-naciones-united-on-climate-change
- (3) EURO CLIMA, August 16, 2016. Parliament of Panama approves the Paris Agreement. https://euroclimaplus.org/noticias-anteriores/item/2006-panama-ratifica-acuerdo-de-paris-contra-cambio-climatico
- (4). Ministry of the environment Dec/2020, Panama delivers commitments to the United Nations convention. https://www.miambiente.gob.pa/panama-entrega-compromiso-a-la-convencion-de-las-naciones-unidas-sobre-cambio-climatico/
- (6) Panama, April 25, 2022, enactment of an incentive law for electric mobility. https://www.energia.gob.pa/presidente-de-la-republica-sanciona-ley-que-incentiva-la-movilidad-electrica-en-el-transporte/
- (7) Ministry of the Presidency of Panama, November 2020, approves guidelines for electric mobility, https://www.presidencia.gob.pa/Noticias/Gabinete-aprueba-lineamientos-de-la-agenda-de-transicion-energetic
- (8) METRO LIBRE, December 2021, https://www.metrolibre.com/econom%C3%ADa/220038-aumentan-las-estaciones-de-carga-para-autos-el%C3%A9ctricos-en-panam%C3%A1.html