FMO expects to finalize a new investment related to energy storage in the Dominican Republic during 2026. The development entity, which already participates in five renewable initiatives within the Dominican market, believes that batteries will be key to supporting the expansion of the sector and improving conditions for new private investments.
This anticipation arises at a time when BESS is attracting considerable attention from developers, financiers, and energy authorities. From FMO's perspective, moving forward with a new project incorporating this technology would be one of the year's major milestones.
“ If we close this year with a battery project, it would be an excellent 2026 for us ,” said Walter Vargas , FMO Investment Executive, during FES Caribe.
The investment is based on the institution's existing experience in the country. The Dominican Republic currently represents FMO's second largest portfolio in Latin America, a position that reflects the continued attractiveness of the local renewable energy market for international investors.
“ The Dominican Republic is our second most important portfolio in Latin America, not only in the region, but beyond ,” Vargas emphasized.
Currently, the entity manages a portfolio of approximately $105 million distributed across five renewable energy assets. The portfolio includes four solar parks and one wind farm, while two of the photovoltaic developments already operate with battery storage systems.
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“ We have five renewable energy projects, a portfolio of around $105 million, which is quite considerable for a bilateral bank ,” the executive said.
Vargas explained that the portfolio consists of “ four solar projects, two of which include battery storage, and one wind project .” He added that “ we already have two battery storage projects that are currently operational .”
The regulatory challenge that investors are observing
While the executive valued the growth shown by the Dominican market in recent years, he also identified some factors that will condition the arrival of new capital to the sector.
Among them is curtailment, a situation that is beginning to impact certain renewable projects and which, according to FMO's view, requires regulatory responses to prevent it from affecting the pace of development achieved so far.
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“ I think it’s a critical issue right now because of the curtailment issue ,” Vargas warned.
He explained that this situation has contributed to slowing some of the momentum that private developers had been experiencing. Even so, he emphasized that the authorities have begun to send positive signals toward energy storage as a mechanism to bring flexibility to the system.
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“ Obviously, I think the government is making a good bet on batteries ,” he said.
For FMO, the next step involves strengthening the regulatory framework to provide greater predictability to market players and facilitate new investment decisions.
“ It is important that they continue on this path, but I believe there needs to be a better structuring of the current regulations ,” he noted.
According to the executive, the effects of these definitions could be felt especially towards the end of 2026, when local and foreign investors evaluate new opportunities within the country.
“ I think that will make a big difference, for example, maybe not now, but by the end of 2026, especially for all private and foreign investors ,” he remarked.
Despite the remaining challenges, FMO's assessment of the Dominican market remains positive. When asked about the current situation in the country, Vargas chose a concise definition to summarize his view.
And he concluded: “ I think it is a country that is progressing, it is moving forward well, obviously there are challenges and opportunities and many issues to improve, but I think that is the word I would use for the Dominican Republic: thriving today .”
RELIVE THE FULL INTERVIEW: https://www.youtube.com/watch?v=YXNJCyZa4bE