EIB and Naturgy sign $300 million CESCE-guaranteed loan to modernise Panama power grid

• The project will improve the reliability and efficiency of Panama’s power grid, strengthening security of supply and access to electricity for households and businesses.
• The agreement contributes to the EIB Group’s climate action and environmental sustainability goals.
• This is the largest loan signed by the EIB for a private company in Central America.

EIB Global, the international partnerships and development arm of the European Investment Bank (EIB), and Naturgy Energy Group, via its Panamanian distribution companies EDEMET, S.A. and EDECHI, S.A., have signed a $300 million framework loan to back the modernisation and expansion of Panama’s power grid. This is the largest loan signed by the EIB for a private company in Central America.

The loan is guaranteed by Spanish export credit agency CESCE. This guarantee was developed jointly by the EIB and CESCE to support green projects led by Spanish companies outside Spain, contributing to the climate action and environmental sustainability goals promoted by the European Union within and beyond its borders.

This project will improve the reliability and efficiency of electricity supply in the country, connect new users, including low-income households, and enable greater integration of renewable energy sources. The agreement is an example of public-private sector cooperation to promote the energy transition and sustainable development in Panama.

The signature event was attended by EIB Group President Nadia Calviño, Naturgy Chairman and CEO Francisco Reynés, CESCE CEO Pablo de Ramón-Laca, EIB Vice-President Ioannis Tsakiris, EU ambassador to Panama Isabela Matusz and Spanish ambassador to Panama Guzmán Palacios Fernández.

Several members of the government of Panama were also present: Minister for the Economy and Finance Felipe Chapman, Minister of the Presidency Juan Carlos Orillac, Trade and Industry Minister Julio Moltó, Foreign Minister Javier Martínez-Acha, Minister for Canal Affairs José Ramón Icaza, Mayor of Panama Mayer Mizrachi, Energy Secretary of the Government of Panama Rodrigo Rodríguez and National Public Services Authority (ASEP) General Administrator Zelmar Rodríguez Crespo. The board of directors of Naturgy Panamá was also in attendance.

“This EIB financing will support the modernisation of Panama’s energy infrastructure, strengthening regional energy integration. It is an example of how partnerships are key to providing people with access to a cleaner and more secure energy supply,” said EIB Group President Nadia Calviño.

“This loan will strengthen Naturgy’s investments in Panama, and reflects our commitment and intention to stay in the country. The new investments in Panama’s power grid will help improve service quality for our customers and security of supply, while promoting a more efficient, secure and sustainable energy model,” added Naturgy Chairman and CEO Francisco Reynés.

CESCE CEO Pablo de Ramón-Laca highlighted “the leadership of Spanish companies in the implementation of key projects for Panama’s economic development.” He also stressed the importance of the agreement with the EIB that “expands CESCE’s capacity to support the international expansion of Spanish companies.”

“This collaboration with Naturgy and CESCE reflects the EIB’s role as a catalyst for sustainable investments connecting Europe with Latin America. This project will drive the modernisation of Panama’s electricity system and facilitate access to cleaner, more efficient and more affordable energy for thousands of homes and businesses. It is a clear example of how the Team Europe approach and the Global Gateway initiative have a real impact on people’s lives and contribute to a more sustainable and resilient energy future,” said EIB Vice-President Ioannis Tsakiris.

Modernising electricity infrastructure to promote growth in Panama

This initiative is a major step forward for the development of Panama’s energy infrastructure. The investment programme will expand and modernise power distribution grids across the country, cutting technical and commercial losses, while also expanding the capacity and resilience of the electricity system. In addition, it will facilitate the connection of new users and help integrate renewable energy, especially solar energy. By improving the grid’s operational efficiency and reliability, the project is expected to help reduce electricity costs and strengthen energy security, benefiting the most vulnerable communities in particular. This investment will contribute to long-term energy security, economic growth and climate change mitigation in Panama, and promote European participation in Latin America’s sustainable energy transition.

The agreement will make a significant contribution to the climate action objectives set out in the EIB Group’s Strategic Roadmap for 2024-2027 and phase 2 of the Climate Bank Roadmap for 2026-2030.

Strengthening EU-Latin America cooperation for energy infrastructure

The operation is part of the EU Global Gateway Investment Agenda for Latin America and the Caribbean, under the flagship initiative to bolster the Central American Regional Electricity Market (MER). It will help achieve Panama’s Nationally Determined Contribution (NDC) under the Paris Agreement by enabling the integration of new renewable energy capacity and improving overall system efficiency. The project is an example of the EIB’s key role as the financial partner of European companies expanding investments in sustainable infrastructure in Latin America.

To this end, at the recent CELAC-EU (Community of Latin American and Caribbean States) Summit in Colombia, the EIB presented a new €1 billion financing initiative to back investment in integrating power grids across Central America. This lending envelope will support the construction and upgrading of transmission and distribution infrastructure and promote renewable energy generation in Costa Rica, Panama, Honduras, Guatemala, El Salvador and Belize. The operation aims to help the region advance its energy transition and decarbonisation goals, while improving access to reliable and affordable electricity.

Background information

About EIB Global:

The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances investments that contribute to EU policy objectives.

EIB Global is the EIB Group’s specialised arm devoted to increasing the impact of international partnerships and development finance, and a key partner of the Global Gateway. It aims to support around €100 billion of investment by the end of 2027. EIB Global brings the EIB Group closer to people, companies and institutions through its offices across the world. Photos of EIB headquarters for media use are available here.

The EIB in Latin America and the Caribbean:

The European Investment Bank has been providing economic support for projects in Latin America and the Caribbean since 2022, facilitating long-term investment with favourable conditions and providing the technical support needed to ensure that these projects deliver positive social, economic and environmental results. Since the EIB began operating in Latin America in 1993 and the Caribbean in 1978, it has provided total financing of more than €17 billion to support over 350 projects in 30 countries in the region.

About the Global Gateway Investment Agenda:

EIB Global is a key partner in the implementation of the European Union’s Global Gateway Investment Agenda, supporting sound projects that improve global and regional connectivity in the digital, climate, transport, health, energy and education sectors. Investing in connectivity is at the very heart of what EIB Global does, building on the Bank’s 65 years of experience in this domain.

About Naturgy:

Naturgy is an energy multinational with a diversified international business portfolio. In addition to Spain, the group is also active in Latin America (Mexico, Brazil, Argentina, Chile and Panama), the United States, Australia and the rest of Europe. It supplies gas and electricity to over 18 million customers in the above countries, operating in both regulated and liberalised markets. It works in electricity generation, distribution and sale, as well as in gas infrastructure, distribution and sale. The group has electricity generation capacity of 18.4 GW across the world, with a diversified mix including 7.7 GW of renewable capacity.

Naturgy’s commitment to Panama:

Naturgy has made record investments of $500 million, committed in the income limit (IMP) tariff review 2022-2026. For 2026-2030 (ASEP approval pending), estimated investment of over $600 million will go to projects focused on improving quality, growing demand, cutting losses and modernising the grid. Since the end of 2024, the company has concluded 14 substation and distribution line projects totalling $46 million. Naturgy Panamá is also now implementing a further 24 strategic projects with associated investment of $215 million.

Naturgy’s efforts over the past year, with approval from the regulatory authority, have led to a major improvement in service quality, among other indicators. Since the implementation of the company’s quality plan, the unplanned system average interruption duration index (SAIDI) has been reduced by 23%, and the unplanned system average interruption frequency index (SAIFI) has fallen by 25% (September 2024 to September 2025).

About CESCE:

CESCE is Spain’s export credit agency. It has a wide range of insurance policies and guarantees to help make Spanish companies’ international activities more competitive and secure.