Guatemalan municipalities are reportedly charging fees to authorize solar projects using criteria that lack legal backing, according to a warning issued by the Association of Renewable Energy Generators (AGER) .
The sector warns that this situation already affects more than 15 developments and could jeopardize the execution of investments awarded in the PEG-5 tender, which allocated 29 new plants for 729 MW and 20 expansions for another 500 MW , capacity that must come into operation around 2030 to accompany the growth in demand.
Two cases reported by member companies illustrate the controversy: one municipality intends to calculate licenses based on the number of solar panels installed, while another seeks to do so based on the plant's MW capacity. "Neither of these criteria has legal backing," stated Astrid Perdomo , executive director of AGER , in an interview with Energía Estratégica .
He also pointed out that some authorities exercise excessive discretion in issuing building permits, with fees that have no technical or legal basis.
According to the association, the lack of uniform procedures creates uncertainty for investors and opens the door to disproportionate charges that can affect the economic viability of projects. It also exposes the municipalities themselves to legal challenges.
More than 15 projects are already facing obstacles
AGER comprises 82 members and represents over 90% of the renewable energy produced in Guatemala . According to information provided by its members, there are currently more than 15 renewable energy generation projects facing specific obstacles stemming from municipal decisions.
Because this information is sensitive for companies, the agency is refraining from identifying all affected developments. However, it notes that some projects already in commercial operation also faced delays and higher-than-estimated costs due to construction permits.
One of the most representative cases is Solar El Progreso , located in Jalpatagua. The project has an environmental license from MARN , a connection permit from INDE , approvals from CNEE and EOR , and was formally awarded in the PEG-4.
Even so, the project has been stalled for more than two years due to the mayor's refusal to issue the corresponding license, in a process that the development company considers contrary to the current legal framework.
The impact on Jalpatagua is concrete: the municipality stopped receiving USD 57 million in direct investment , USD 150,000 for construction licenses , USD 300,000 annually in social and environmental investment , in addition to jobs for communities in the area of influence.
“When projects that meet all legal requirements encounter arbitrary or discretionary obstacles, it not only affects a company or an investor; it limits job creation, infrastructure development, and opportunities for communities,” says Perdomo.
Continue reading
The risk to PEG-5 and electricity demand
The warning carries even more weight due to the growth in demand. According to AGER, Guatemala faces a historic scenario: during the first half of 2026, the country exceeded its historical peak demand five times, currently standing at 2427.15 MW .
In this context, the projects awarded in the PEG-5 auction must proceed without delay to meet the agreed deadlines. Most of the new plants are scheduled to begin generating power around 2030 , so administrative timelines are now critical.
Perdomo stressed that the awarding of contracts alone does not guarantee that the projects will be built: “The success of PEG-5 will not be measured by the contracts signed, but by the country's ability to transform those investments into operational megawatts.”
Among the awardees are developers with extensive experience in Guatemala and the region, who will now have to move forward with engineering processes, permits, financing and construction to meet the agreed deadlines.
This is precisely where one of AGER's main concerns lies: that projects already awarded may encounter difficulties in materializing due to factors unrelated to the technical or economic conditions of the initiatives.
“If the municipal obstacles that are currently affecting development projects are not resolved, Guatemala risks not being able to convert those contracts into real infrastructure within the agreed timeframes,” Perdomo warns.
The executive adds that ensuring supply for the coming years and maintaining competitive conditions for the country and Guatemalan households will depend, to a large extent, on municipal authorities supporting the development of these investments.
The discussion also coincides with a new planning phase for the sector. During the Future Energy Summit (FES) Guatemala , energy authorities announced that the country is considering moving forward with new contracting processes, including PEG-6 and PET-4 , with the goal of continuing to incorporate firm generation and transmission infrastructure. In this context, the private sector considers it essential to resolve the barriers currently affecting projects under development in order to strengthen investor confidence for upcoming tenders.
But AGER insists that investor confidence will depend on legal certainty and the institutional capacity to resolve local roadblocks. “Guatemala needs to send a clear signal of respect for the rule of law, legal certainty, and the rules of the game,” Perdomo emphasized.
The association is asking the Central Government to assume an active role in inter-institutional coordination and to establish agile mechanisms to resolve administrative obstacles in projects that already have national permits.
It also requests municipalities to define uniform, transparent and legally sound criteria for the collection of licenses and the issuance of authorizations related to renewable projects.
“Unlocking these investments is not only a necessity for the energy sector, but an essential condition for the country’s competitiveness and sustainable development,” Perdomo concluded.