Panama debates Bill 705 to reform electricity service laws

The Trade Commission in Panama is beginning the first debate on Bill 705, a government proposal aimed at reforming the regulatory framework for public electricity services. Following a consultative period that yielded over 115 modification proposals from users, energy generators, distributors, and state regulators, the debate now focuses on integrating these suggestions.

A key component of the bill is the authority to cancel concessions for distributors that fail to meet service quality standards. This includes five specific grounds for contract termination related to performance indicators, rural electrification obligations, and approved investments. Zelmar Rodríguez, administrator of the National Authority of Public Services (ASEP), noted that the reform seeks to penalize poor service quality.

National Energy Secretary Rodrigo Rodríguez highlighted that approximately 5% of Panamanian households currently lack electricity because they reside in areas deemed unprofitable by distributors. The proposed legislation would mandate that companies extend service to roughly 58,000 families currently without power. Some stakeholders and deputies have proposed that certain termination clauses only take effect after current concessions are renewed in October 2028, while the government emphasizes the need for immediate economic consequences for poor service.