Wasting Renewable Energy Comes at a High Cost for the Dominican Republic

• The Dominican Republic lost approximately USD 5.17 million in renewable energy between January and June 2025 due to "curtailment," the practice of intentionally limiting renewable energy production.
• State-owned distributors (EDES) incurred USD 6.5 million in excess costs by prioritizing more expensive fossil fuels over available, cheaper renewable energy.
• Frequent grid congestion and the "forced dispatch" of inflexible thermal power plants prevent renewable sources from reaching their full potential.

Economic Impact

• Renewable energy companies face reduced profit margins as production is limited and average energy purchase prices drop, affecting those with fixed-price Power Purchase Agreements (PPAs).
• Fossil fuel plants benefit from increased marginal costs in the spot market, rising from 9.75 to 12.65 US cents/kWh between January and July 2025.
• The state provided USD 737.3 million in subsidies to cover deficits of the distribution companies as of July 2025, with an accumulated deficit of USD 936.7 million.

Operational Challenges

• Thermoelectric plants frequently ignore the Technical Minimum Power (PMT) standard, which is intended to limit fossil fuel use and favor renewables.
• "Forced dispatch" payments—where inflexible plants are paid to stay online despite not being cost-competitive—rose to USD 11.33 million in the first half of 2025.
• Lack of grid modernization and insufficient energy storage capacity are primary drivers of grid instability and the need for curtailment.

Future Outlook

• IRENA reports suggest the country could reach 44 percent renewable generation by 2030 if it addresses institutional and technical flexibility gaps.
• Experts advocate for immediate investment in energy storage to regulate frequency and safely integrate more solar and wind power into the national grid.