El Salvador Energy Situation

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El Salvador

Capital:

San Salvador

Region:

Latin America

Coordinates:

13.6667° N, 89.1667° W

Total Area (km²): It includes a country's total area, including areas under inland bodies of water and some coastal waterways.

21,040

Population: It is based on the de facto definition of population, which counts all residents regardless of legal status or citizenship--except for refugees not permanently settled in the country of asylum, who are generally considered part of the population of their country of origin.

6,364,943 (2023)

Rural Population (% of total population): It refers to people living in rural areas as defined by national statistical offices. It is calculated as the difference between total population and urban population.

25 (2023)

GDP (current US$): It is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products. It is calculated without making deductions for depreciation of fabricated assets or for depletion and degradation of natural resources.

340,156,200,002 (2023)

GDP Per Capita (current US$): It is gross domestic product divided by midyear population

5,344.21 (2023)

Access to Electricity (% of population): It is the percentage of population with access to electricity.

100.00 (2022)

Energy Imports Net (% of energy use): It is estimated as energy use less production, both measured in oil equivalents. A negative value indicates that the country is a net exporter. Energy use refers to use of primary energy before transformation to other end-use fuels, which is equal to indigenous production plus imports and stock changes, minus exports and fuels supplied to ships and aircraft engaged in international transport.

49.24 (2014)

Fossil Fuel Energy Consumption (% of total): It comprises coal, oil, petroleum, and natural gas products.

48.43 (2014)

Source: World Bank

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Introduction

El Salvador is a small country in Central America with a territory of only 21,040 km². In 2022, El Salvador's total population was 6.3 million, with 61.7 % of the population living in urban areas and 38.3 % in rural areas. Population density is 301 inhabitants per km²; El Salvador has by far the highest population density among all countries in Central and South America 64.2 % of the total poulation is concentrated in only five of the 14 departments (San Salvador, La Libertad, Santa Ana, San Miguel, and Sonsonate). In 2022, poverty was 26.6%, and extreme poverty (income of less than US$ 2.15 per day) was 8.6%. However, by 2022, extreme poverty had redoubled in comparison with the pre-pandemic levels of 2019). The reason for this observation is at least in part attributed to the rise in the cost of living fueled by high inflation rates of 6.1 % in 2021 and 7.3 % in 2022.

Between 2010 and 2022, El Salvador achieved a moderate rate of economic growth averaging 2.4 % per year. 1 In 2020, the gross domestic product (GDP) contracted by 7.9 % in the wake of the COVID-19 pandemic, but recovered in 2021 with growth of 11.2 %, and an additional 2.6 % in 2022. For 2023, the Central Reserve Bank of El Salvador (BCR) expects growth of between 2 % and 3 % and the inflation rate between 3.5 and 4.1 %.

Institutional Set up in the Energy Sector

Until the 1990s, the electric power sector in El Salvador maintained a vertically integrated structure. The Lempa River Hydroelectric Executive Commission (Comisión Ejecutiva Hidroeléctrica del Río Lempa, CEL) Was the only, state-owned electricity company. In 1996, the new General Law of Electricity (Ley General de Electricidad) took effect. It liberalized the electricity market, opened it to other public and private companies.besides the CEL, and introduced free competition in the wholesale and retail market segments.

The transmission system is operated by the Empresa Transmisora de El Salvador. This is a state-owned corporation that also owns the transmission infrastructure.

Electricity distribution  is concessioned to eight public and private distribution companies. A transactions unit manages  the  operation  of  the  transmission system  and  the wholesale electricity market.

The sector regulatory authority is the General Superintendency of Electricity and Telecommunications (Superintendencia General de Electricidad y Telecomunicaciones, SIGET). SIGET is responsible for the enforcement of the General Law of Electricity; among other functions it issues norms  and  technical  standards, determines the rates  and  charges  for  use  of  the  national transmission  system; and supervises  compliance  with  technical  standards  and service quality. 

Other Key Actors / Activities of Donors, Implementing Agencies, Civil Society Organisations

The Inter-American Development Bank (IDB) approved on 11 October 2023 a loan of US$ 93 million to the Lempa River Hydroelectric Executive Commission (Comisión Ejecutiva Hidroeléctrica del Río Lempa, CEL) for the purpose of the implementation of the Universal Energy Access Program in El Salvador. The general objective of the first individual operation is to contribute to the universalization of the electrical energy service in El Salvador, through the implementation of sustainable electrification modes that maximize the use of renewable energies. The specific objectives are: (i) to increase access to the electricity service in the country; (ii) to strengthen the technical capacity of the Lempa River Hydroelectric Executive Commission (CEL) group to plan and manage electrification projects; and (iii) to promote productive uses of energy in the beneficiary communities of electrification projects.

References

SIGET (2021): Mercado eléctrico de El Salvador 2020 (abril 2021). Superintendencia General de Electricidad y Telecomunicaciones (SIGET). San Salvador; available online at: https://www.siget.gob.sv/wp-content/uploads/2021/05/Mercado-Electrico-de-El-Salvador-2020-2.pdf .

SIGET: Boletín de Estadísticas eléctricas Año 2022 (No. 24). Superintendencia General de Electricidad y Telecomunicaciones (SIGET). San Salvador; available online at: https://www.transparencia.gob.sv/institutions/siget/documents/556832/download.