Bolivia Opens Solar Door for Private Energy Producers

Bolivia is rolling out the welcome mat for private solar energy producers with a new law that makes it simpler and more profitable to connect renewable projects to the national grid.

The government approved Supreme Decree 5549 in early 2025, creating a brand new category for medium-scale clean energy projects between 1 MW and 6 MW. These producers can now plug directly into distribution networks without jumping through the old bureaucratic hoops of obtaining a generation concession.

The decree introduces two payment systems depending on project size. Small generators will use net metering, where they get credit for any extra electricity they send back to the grid. Medium projects will receive a price set by regulators, with payment coming from wholesale market participants.

Hydrocarbons Minister Mauricio Medinaceli says the goal is straightforward: encourage people and companies to generate their own clean power, use what they need, and sell the surplus. Distribution companies will pay system owners directly, with solar installations leading the way.

Bolivia is betting big on geography. The high-altitude Altiplano region gets intense sunlight perfect for solar panels. Eastern areas have abundant biomass resources. The new framework lets each region tap into whatever renewable resource works best locally.

The country currently has just 177 MW of installed solar capacity, according to the International Renewable Energy Agency. That number could grow quickly as the simplified approval process attracts new investors who were previously discouraged by complex regulations.

The Ripple Effect

This policy shift does more than add megawatts to the grid. It decentralizes power generation, meaning communities become less dependent on large centralized plants and long transmission lines. When storms or technical failures strike one area, locally generated power keeps lights on elsewhere.

The government plans to release detailed technical regulations in coming weeks, along with a proposed Green Law designed to mobilize both public and private investment in renewable energy. Implementation starts with private sector projects before expanding to commercial buildings and homes.

Bolivia joins a growing list of developing nations discovering that distributed renewable energy can leapfrog traditional power infrastructure, much like mobile phones bypassed landlines. The financial incentives combined with reduced paperwork create a pathway for farmers, businesses, and eventually homeowners to become energy producers rather than just consumers.

The future looks brighter for Bolivia's energy independence.