Mapping Electricity Market Reform Pathways for Latin America and the Caribbean
Rather than treating the region as a single market, the study starts from the reality that electricity systems in Latin America and the Caribbean are at different stages of institutional and market development. It highlights the co-existence of cost-based and price-based (free-offer) market models, with Colombia identified as a regional example of the latter. The analysis notes that while cost-based approaches suit markets with limited competition or price transparency, they may impose significant constraints on the integration of new technologies, particularly battery storage, where regulatory frameworks may not fully reflect opportunity costs.
Mapping Electricity Market Reform Pathways for Latin America and the Caribbean
Rather than treating the region as a single market, the study starts from the reality that electricity systems in Latin America and the Caribbean are at different stages of institutional and market development. It highlights the co-existence of cost-based and price-based (free-offer) market models, with Colombia identified as a regional example of the latter. The analysis notes that while cost-based approaches suit markets with limited competition or price transparency, they may impose significant constraints on the integration of new technologies, particularly battery storage, where regulatory frameworks may not fully reflect opportunity costs.

