Q COSTA RICA — Two wind farms in Costa Rica have received approval to supply electricity to the regional grid, adding new renewable generation to a system that links six Central American countries.
The Regional Electricity Interconnection Commission authorized Eólico San Jorge and Vientos de la Montosa to connect their plants, each with a capacity of 20 megawatts, to the Central American Electrical Interconnection System, known as SIEPAC. Both projects are located in Guanacaste and had secured electricity-supply contracts from Costa Rica’s state-run electricity utility, ICE, in 2024.
The approvals arrive as a joint report by the OECD, CAF, the UN Economic Commission for Latin America and the Caribbean, and the European Union highlights regional electricity integration as a potential driver of investment and trade. The report describes SIEPAC as Latin America’s most advanced energy-integration initiative, with the capacity to help lower electricity costs, strengthen energy security and supply industries that need reliable, lower-carbon power.
A regional system with room to grow
SIEPAC has connected Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama since 1996 through a physical transmission line and a regional wholesale electricity market. Its purpose is broader than moving power from one country to another: integration can let countries share renewable resources and support industries that depend on a stable electricity supply.
That matters as electricity demand grows among sectors such as data centers, manufacturing, mineral processing and green-fertilizer production. The two Costa Rican plants add a combined 40 megawatts of wind capacity to the regional system. Their approval is a practical step, though it does not by itself establish how much power they will export or how often the regional market will call on their output.
The EU has identified deeper regional electricity integration as a priority under its Global Gateway investment agenda. European and German-backed programs, including GET.transform and GET.invest, are also providing technical support for efforts to link the Central American system with the Andean electricity-interconnection system, Infobae reports.
Connection is only the first test
The new approvals show why transmission links matter to renewable energy. Wind and solar output can vary with weather and time of day; a larger interconnected system can give utilities more options for balancing supply and demand across borders. In principle, that can make renewable generation more useful beyond the country where it is produced.
But new generating capacity is only one part of the equation. The benefits will depend on whether transmission infrastructure can carry the electricity where it is needed, whether regional market rules allow it to be traded efficiently, and whether the system can manage changes in supply.
The available report establishes the plants’ authorization to connect, not the scale of their future cross-border sales.
The broader economic case also faces obstacles beyond the power sector. A CEPAL study finds that moving a tonne of cargo one kilometer in Central America can cost up to eight times more than in the United States. Border delays can exceed 20 hours, while trucks on some corridors average 17 kilometers per hour. Those constraints could limit the trade and investment gains that better energy links are meant to support.
The regional outlook therefore depends on more than building interconnections. The OECD report also points to transport corridors, customs improvements, digital logistics and cross-border energy infrastructure as priorities. Energy integration can help attract industries that need dependable power, but its economic payoff will be shaped by whether goods, services and investment can move through the region just as reliably.